12:00 AM
Apr 04, 2011
 |  BioCentury  |  Finance

ASCO and Beyond

Buyside stock picks for 2Q11: ASCO plays, Phase III data, product launches

The second quarter docket is full of clinical and regulatory milestones, as well as early reports of sales for a number of newly launched products.

Foremost among the events this quarter is the American Society of Clinical Oncology meeting June 3-7 in Chicago. The meeting abstracts are due to be posted on May 18, but Kurt von Emster of venBio expects investors will start looking at ASCO plays relatively early in the quarter.

He expects Aveo Pharmaceuticals Inc. to have Phase III data for tivozanib (AV-951) to treat advanced renal cell carcinoma (RCC). The company is hoping the pan-VEGF receptor tyrosine kinase inhibitor's potency and selectivity could make it the front-line choice in the indication (see BioCentury, Feb. 21).

Harald Schwarz of Medical Strategy also is looking for the Aveo data at ASCO. "It could be the new market leader," he suggested.

von Emster is also looking for Phase II data on ganetespib, an Hsp90 inhibitor from Synta Pharmaceuticals Corp. to teat non-small cell lung cancer (NSCLC). In addition, he and several other investors said they would be looking at progression-free survival data for Celgene Corp.'s Abraxane nab-paclitaxel in the same indication.

YM BioSciences Inc., which attracted attention at last year's American Society of Hematology (ASH), is expected to present additional data at ASCO on its CYT387 for myelofibrosis (see BioCentury, Jan. 17).

Investors will be looking for more comparisons to INCB18424 from Incyte Corp. Both compounds are Janus kinase-1 (JAK-1) and JAK-2 inhibitors.

"CYT387 looks like it could have comparable efficacy to the Incyte compound INCB18424. We don't have much data to go on but it looks very interesting," said David Pinniger of International Biotechnology Trust.

"There will be fuller Phase II data at ASCO," he said. "If these are supportive of what's been released to date, I would expect them to do a high value partnership or get taken out. Without the issues that have afflicted some competitor compounds, with CYT387 YM could rapidly join Incyte as a frontrunner."

INCB18424 had positive Phase III data for the indication last month. Incyte plans to submit an NDA this quarter.

"We're getting ready to harvest a new crop of oncology drugs," said Selena Chaisson of Bailard, who focuses on investment in small caps and microcaps. She expects "a lot of Phase I, Phase II data, where those drugs are the key to valuations on those stocks."

In addition to YM and Aveo, Chaisson is watching ArQule Inc. and Sunesis Pharmaceuticals Inc. In January, ArQule started Phase III testing of ARQ 197 to treat NSCLC, and Sunesis did the same for vosaroxin to treat acute myelogenous leukemia (AML).

Full of Phase III

Also this quarter, Phase III data are expected for oral treprostinil to treat pulmonary arterial hypertension (PAH). United Therapeutics Corp. will disclose monotherapy data in June, with combination therapy data following in September.

Schwarz thinks treprostinil has a good chance of success, even though it missed the primary endpoint in a previous Phase III trial. The company attributed that failure to a suboptimal dose-titration regimen.

This time around, the expectation is that more gradual titration will mitigate side effects. This should keep more patients in the trial and allow them to get a higher dose, several buysiders told BioCentury.

A darling from the fourth quarter, Amarin Corp. plc, will have Phase III data in mixed dyslipidemia for its AMR101. In December, the company reported positive Phase III results for the ethyl ester of eicosapentaenoic acid (ethyl-EPA) to treat hypertriglyceridemia.

Investors are also watching Regeneron Pharmaceuticals Inc., which von Emster noted has "a lot of additional value points in front of it."

The biotech is expected to submit by quarter end an MAA for VEGF Trap-Eye to treat wet age-related macular degeneration (AMD). Also this quarter, Regeneron will have Phase III data for VEGF Trap-Eye to treat central retinal vein occlusion (CRVO), as well as Phase III data for aflibercept (VEGF Trap) as a second-line treatment for metastatic colorectal cancer.

VEGF Trap-Eye is partnered with Bayer AG, and aflibercept is partnered with sanofi-aventis Group.

Among the big caps, Biogen Idec Inc. will have data from two Phase III trials of BG-12 to treat multiple sclerosis (MS), with the first coming this quarter.

A healthcare buysider, who did not want to be named, has low expectations for BG-12. "If it's three times a day and has major side effects like diarrhea, it won't be that helpful," he said.

Both of the Phase III...

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