April 13, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Biotech stocks are more volatile than ever, but some life science stocks seem to be on a massive upswing. Let’s take a look at three life science stocks going into orbit or have the potential to.
Ewing, N.J.-based Celator Pharmaceuticals , which also has offices in Vancouver, B.C., focuses on combination therapies for cancer. Its proprietary platform, CombiPlex, supports design and rapid evaluation of optimized combinations of cancer medications.
On Mar. 14, Celator announced positive results for a Phase III trial of Vixeos (cytarabine: daunorubicin) Liposome for Injection in patients with high-risk (secondary) acute myeloid leukemia (AML). Its primary endpoint was met, which was statistically significant improvement in overall survival.
The company’s has gone through the roof with a 650 percent increase this year. Shares traded on Mar. 11 for $1.53, rocketed to $9.38 on Mar. 16, and spiked to $13.75 on April 7. Shares are currently trading for $13.51.
Todd Campbell, writing for The Motley Fool, says, “Enthusiasm for this optimized therapy, Vyxeos, may not be misplaced. The 7+3 regimen has been commonly used in this tough-to-treat indication for decades, and up until now, there have been few advancements in treatment in this indication.”
He goes on to point out that the company’s continued strength is going to depend on regulatory approval, which won’t happen until next year. It plans to file with the U.S. Food and Drug Administration (FDA) in the third quarter, and in Europe in 2017. “Because those filings haven’t happened yet,” Campbell writes, “investors should undeniably approach this company cautiously.”
TransEnterix , headquartered in Morrisville, N.C. focuses on surgical robots. Company stock has been on the rise since January. Shares traded on Jan. 5 for $1.66, rose to $4.40 on Feb. 9, dropped back to $2.81 on Mar. 1, then leapt to $5.69 on April 6. Shares are currently trading for $5.35.
It hopes to go head-to-head with Intuitive Surgical’s da Vinci surgical robots for about a third of the price and some expanded features and portability. The company picked up the ALF-X system from SOFAR S.p.A in 2015, although it hasn’t proven to be terribly competitive in Europe yet. A new sales team led by former Intuitive Surgical people is hoped to do better.
Better, cheaper and more portable would seemingly be a slam dunk, but when it comes to hospital-related capital acquisitions, it might take time to break into this notoriously conservative market. As Campbell writes, “First, Intuitive Surgical’s tightly tied in with its large installed customer base, and therefore it may be hard to dislodge it from its customers’ sites. Second, small hospitals that may like SurgiBot’s price point may still struggle to find the money in their budget to buy it. Third, there’s no guarantee the FDA will green light SurgiBot. Finally, the company’s a bit tight on cash, and that could present struggles if its launch doesn’t go smoothly.”
Cambridge, Mass.-based Genocea Biosciences uses its ATLAS platform to quickly identify T cell antigens associated with specific immune responses in people who have been exposed to pathogens. This allows the company to more quickly and efficiently develop vaccines and help identify potential cancer immunotherapies.
On Mar. 31, the company announced positive efficacy data from a Phase II dose optimization trial of GEN-003 to treat genital herpes.
“We are very pleased with these data, which show that GEN-003 has strong and durable effects on both HSV-2 viral activity and genital herpes clinical disease, supporting our belief that GEN-003 could become a cornerstone treatment for patients affected by this serious disease,” said Chip Clark, president and chief executive officer of Genocea, in a statement. “Specifically, a single course of treatment of GEN-003 may offer benefits similar to a full year of daily administration of oral antiviral—but with greatly improved convenience.”
Over the last year, Genocea hasn’t really been all that dazzling. Shares traded on July 17, 2015 for $16.06, dropped to $4.31 on Oct. 26, then further to $2.64 on Feb. 8, 2016. They rose slightly on Mar. 24 to $3.96, but recently spiked to $7.74 on Mar. 31. Shares are currently trading for $5.56.
Much will depend on results from the Phase III confirmatory study scheduled in 2017. If the drug lives up to its promise and gets approved, it could be worth billions.
Campbell writes, “Nevertheless, there’s still a lot that could derail this drug from here, and the company’s cash stockpile is small enough for me to think a dilutive offering could be on the horizon. Therefore, this remains a risky bet suited only for those who could endure a complete failure in its late-stage trial.”
So it’s always worthwhile to remember basic stock advice: buy low, sell high.
