4:40 PM
Jul 07, 2017
 |  BioCentury  |  Finance

Onward and upward

Biotech winners, losers in 2Q17

The top three market cap tiers continued to outperform smaller caps in 2Q17, led by companies valued between $1 billion and $9.9 billion. Companies valued below $1 billion failed to carry over their momentum from the first quarter, with the bottom two market cap tiers both losing ground.

Large cap biotechs valued at $10 billion and up posted a median increase of 4.2% and gained nearly $47 billion in aggregate equity value (see “Results by Market Cap”).

Regeneron Pharmaceuticals Inc. led the charge with a 27% gain after U.S. and EU approval of Kevzara sarilumab to treat rheumatoid arthritis and FDA approval of a new once-monthly dosing schedule for hypercholesterolemia drug Praluent alirocumab. Both Kevzara, a mAb against IL-6 receptor, and Praluent, a mAb against PCSK9, are partnered with Sanofi.

Regeneron also got a bump late in the quarter on data from a Phase III trial comparing its wet age-related macular degeneration (AMD) drug Eylea aflibercept to brolucizumab from Novartis AG. While the trial found brolucizumab non-inferior to Eylea, multiple analysts and investors noted that putting the milestone in the rearview mirror removed an overhang on Regeneron’s stock.

UCB S.A. posted the only double-digit loss among large caps, with shares off 17% on the quarter on a cardiovascular safety signal in the Phase III ARCH trial of Evenity romosozumab to treat postmenopausal osteoporosis. Evenity has a PDUFA date of July 19, but UCB and partner Amgen Inc. have said they no longer expect FDA to approve the mAb against sclerostin.

The $5-$9.9 billion band performed best among the five tiers, surging to a 10.2% median gain and adding $6.7 billion in total market value. Ipsen Group shares gained 28%, which combined with a 7% gain in the euro pushed the company’s market cap to $11.1 billion. Ipsen said 1Q17 sales increased 19.1% over 1Q16 and raised 2020 sales targets to over €2.5 billion ($2.8 billion) based on expected 2016-20 annual growth over 14% in specialty pharmaceuticals and 4-6% in consumer healthcare.

Seattle Genetics Inc. dropped 18% in 2Q to bring up the rear in the $5-$9.9 billion group. In late June, the company discontinued the Phase III CASCADE trial of vadastuximab talirine to treat acute myelogenous leukemia (AML) after finding a higher rate of deaths, including deaths from infections, in patients receiving the mAb than in controls. Vadastuximab is a mAb against CD33 conjugated to 2 pyrrolobenzodiazepine (PBD) dimer moieties.

Puma Biotechnology Inc. led the $1-$4.9 billion tier, which was up a median of 9.2% and added $31 billion in total market value. Puma shares skyrocketed 135% after FDA’s Oncologic Drugs Advisory Committee (ODAC) voted that the overall risk-benefit profile of neratinib favored approval to treat HER2-positive breast cancer in the extended adjuvant setting despite high rates of diarrhea. The oral inhibitor of HER1, HER2 and HER4 kinases has a July 21 PDUFA date.

Shares of Idorsia Ltd. also surged after it spun out from Actelion Ltd. following the bellwether’s acquisition by Johnson & Johnson. Idorsia, which has four programs in Phase II testing in indications including hypertension, insomnia and aneurysmal subarachnoid hemorrhage, closed the quarter up 81% from its June 16...

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