Two Small Biotechs That May Have a Big 2016

January 27, 2016
By Alex Keown, BioSpace.com Breaking News Staff

CHICAGO -- Following a 28 percent stock drop for Inovio Pharmaceuticals , analysts at the Motley Fool have pinpointed two small-cap biotech stocks that might deliver more bang for investors’ bucks in 2016.

Writing in the Motley Fool, Keith Speights picked Idera Pharmaceuticals and Cara Therapeutics as companies to watch this year.

Idera Pharmaceuticals

Speight’s analysis of Cambridge, Mass.-based Idera Pharmaceuticals began with a caveat that the company saw its own stock decline of 35 percent in 2015, but said Idera should see a boost this year after results from a Phase I/II study of toll-like receptor (TLR) 7, 8, and 9 antagonist IMO-8400 in treating Waldenstrom's Macroglobulinemia becomes available later this year. The company also has another Phase I/II trial in progress. In December, Idera announced enrollment in the trial, which will see escalating doses of IMO-2125 ranging from 4 mg/kg through 32 mg/kg, will be administered intra-tumorally into one of two selected tumor lesions. Preclinical evidence shows that IMO-2125 delivered intra-tumorally in combination with anti-CTLA-4 mAb demonstrates improved inhibition of tumor growth, regression of metastases and infiltration of the number and nature of tumor specific immune cells in injected and non-injected tumor lesions versus monotherapy with either agent, the company said. Data from this study is expected later this year.

Idera stock is currently up this morning, trading at $1.78 per share, but it still has a long way to go to get back to the $5.14 per share it was trading at in February 2015.

Cara Therapeutics

Shelton, Conn.-based Cara Therapeutics enjoyed a good year in 2015 and Speights said that should continue through this year, largely thanks to the company's lead product, CR845, which is currently in a phase III study for treating acute post-operative pain. In its latest quarterly report, Cara announced positive top-line results from a Phase IIa trial of an oral form of CR845 in patients with osteoarthritis of the knee or hip.

Cara also benefitted from $2.5 million in milestone payments under its development and licensing agreements with Maruishi Pharmaceutical Company, Ltd. of Japan and Chong Kun Dang Pharmaceutical Corp. of South Korea for development of CR845 .n uremic pruritus.

“Like Idera, Cara seems well-positioned to move forward until it can commercialize its lead drug candidate,” Speights wrote.

While Inovio did see a decline in its stock value over 2015, Speights said it was still a stock worth watching as it has several programs coming up this year that could spark a sharp increase in value. In August 2015, AstraZeneca announced a deal between MedImmune , AstraZeneca’s research and development arm, with Plymouth Meeting, Penn.-based Inovio Pharmaceuticals (INO). Under this new deal, MedImmune acquired exclusive rights to Inovio’s INO-3112 immunotherapy against cancers caused by human papillomavirus (HPV) types 16 and 18. Inovio is also expecting to begin a Phase III trial of its cervical dysplasia drug VGX-3100, an immunotherapy treatment. In its earlier clinical trials, the company said VGX-3100 induced regression of precancerous cervical disease and cleared HPV infection with robust T cell responses.