3 Biotechs Bouncing Back After a Tough 2016

3 Biotechs Bouncing Back After a Tough 2016 May 22, 2017
By Mark Terry, BioSpace.com Breaking News Staff

The stock market may have taken a hit recently, but iShares Nasdaq Biotechnology Index notes that the biotech market is doing better this year than last. And specifically, three companies that took hard hits in 2016 have bounced back and hit yearly highs recently. Corey Renauer, writing for The Motley Fool, takes a look.

1. Regeneron Pharmaceuticals

Renauer notes that despite being battered last year, Regeneron Pharmaceuticals has gained about 24.6 percent so far this year. A lot of it has to do with better-than-expected earnings for Eylea for wet age-related macular degeneration, diabetic macular edema and retinal vein occlusion. In the company’s first quarter, Eylea sales rose about 12 percent compared to the first quarter of 2016, which puts it on track to hit $5.4 billion this year.

Renauer writes, “Eylea’s continued success isn’t the only thing pushing up this stock. The biotech recently launched one of the most anticipated drugs of 2017. Dupixent earned an FDA approval for treatment of eczema at the end of March and is expected to generate annual sales of around $5 billion at its peak for Regeneron and its partner, Sanofi .”

That sounds good, and it is, but there’s competition. Pfizer recently launched Eucrisa, and Amgen (AMGN) is filing patent infringement lawsuits against Regeneron over Dupixent.

Regeneron is currently trading for $458.23.

2. Geron Corporation

There were concerns that Geron Corporation , withJohnson & Johnson ’s Janssen Research & Development, were going to scrap its imetelstat program. But in April, Geron announced they had completed a second internal data review of IMerge and IMbark, the two programs evaluating imetelstat in lower risk myelodysplastic syndromes (MDS) and relapsed or refractory myelofibrosis (MF), respectively. The IMbark evaluation found there was clinical benefit and a potential overall survival benefit and would continue unchanged. The IMerge trial found the safety profile with consistent with previous clinical trials, and the benefit/risk profile supported continued development. Part 1 of the trail will continue unmodified.

Renauer noted that this news caused the stock to jump. “Geron’s shares have surged 46.4 percent higher already this year,” he writes, “but continued success for imetelstat could swell its recent $482.3 [million] market cap much further. Johnson & Johnson has a solid track record when it comes to sniffing out successful drugs while they’re still in clinical-stage development. If eventually approved, imetelstat could generate more than $400 million in peak annual sales.”

The risk for Geron is that imetelstart’s the only drug it has in clinical trials, and if this doesn’t pan out or J&J pulls out, the whole party could end.

Geron is currently trading for $3.01.

3. Portola Pharmaceuticals

Johnson & Johnson’s Xarelto, and other drugs that are factor Xa inhibitors used to thin blood, are desirable alternatives to warfarin. But Xa inhibitors are sometimes too good at their jobs and cause uncontrolled bleeding. But Portola Pharmaceuticals ’s AndexXa can quickly neutralize the Xa inhibitors.

Renauer writes, “Last year, the FDA sent AndexXa’s new drug application back for more info regarding its manufacturing site, not the drug itself. Although AndexXa has been delayed, the agency is widely expected to give the thumbs-up eventually. The company also has a factor Xa inhibitor of its own under FDA review, with a decision expected in June. If approved, betrixaban might not surpass the entrenched competition, but $1 billion or more in annual sales isn’t a far-fetched notion.”

Portola is currently trading for $38.88.

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