March 22, 2017
By Alex Keown, BioSpace.com Breaking News Staff
NEW YORK – With biotech stocks struggling to gain a foothold, investors are always looking for a bit of information that hints at potential gains in marketshare. Biotech analyst Edward Nash selected five stocks that are expecting major catalysts over the next six to nine months that could have major impacts on stock prices, 24/7 Wall Street reported this morning.
Shares of Sage are up slightly this morning, trading at $54.05 as of 9:49 a.m. New York-based Sage saw its marketshare plunge last year after a hedge fund announced it was shorting the stock based on the assumption that experimental drug, SAGE-547 will fail. The drug is currently in Phase III testing for treatment of patients with Super-Refractory Status Epilepticus (SRSE). SAGE-547 is an intravenous treatment and has been granted both Fast Track and orphan drug designations by the U.S. Food and Drug Administration for the treatment of SRSE. Phase III data is expected to be announced later this year and Nash speculated the “the probability of a positive outcome of 60 percent if released in the first half for treatment of SRSE and 50 percent in the second half of 2017 for PPD treatment.” The analysts speculate the stock could jump to $95 if the data reads out positively.
Shares of California-based Versartis are down this morning, trading at $19.52 as of 9:55 a.m. The company is developing VRS-317 (Somavaratan), a long-acting recombinant human growth hormone that is currently in Phase III clinical trials for the treatment of growth hormone deficiency. Data is expected to be announced in the third quarter of this year. Nash speculated the probability of a positive outcome of the trial is 70 percent. The analyst pegged share prices to climb to $25, but 24/7 Wall Street said the consensus price is higher at $27.13.
San Diego-based Otonomy Inc. is developing OTO-104 for the treatment of Ménière’s disease and other inner ear conditions. The drug, a formulation of dexamethasone, is in Phase III trials. Nash said the data is expected in the second half of the year. He gives the company a 60 percent probability of positive trial results. As a result, Nash estimated share prices can jump to $45, well above the consensus price of $28.60, 24/7 Wall Street said. Shares of Otonomy are currently trading at $12.25.
Shares of TetraPhase are down more than 4 percent this morning, trading at $7.62. The company is expected to announce Phase III data of its lead drug eravacycline, an antibiotic for use as a first-line empiric monotherapy to treat resistant and multidrug-resistant infections, in the fourth quarter of the year. The analyst predicted a 60 percent probability for a positive outcome. If it hits, Nash said the stock could jump to $14 per share, well above the consensus price of $8.75 per share, 24/7 Wall Street said.
Florida-based Catalyst Pharmaceuticals is expecting data from its lead candidate Firdapse in the later part of 2017. Firdapse is being developed for the treatment of Lambert-Eaton myasthenic syndrome. Catalyst has had a tough road with Firdapse. Last year, the U.S. Food and Drug Administration issued Catalyst a “Refusal to File” letter for its New Drug Application for Firdapse. The FDA found that Catalyst’s application, which was submitted in December 2015, was not sufficiently complete and requested additional supporting information. In April 2016, the FDA said Catalyst must run an additional Phase III trial, as well as additional toxicology studies for Firdapse. Nash anticipates a 40 percent probability of success for Catalyst. If the drug hits, he said the stock could trade for as much as $5 per share. Share prices are down more than 5 percent this morning to $1.61 per share as of 10:19 a.m.
