Stay at the forefront of the week’s champions and runners-up among publicly traded biotech companies and the reasons behind the ups or downs of their stock price fluctuations.
Y-mAbs Therapeutics (YMAB) saw its shares plummet 60% from $8.98 to $3.61 on Monday, the first trading day after an FDA advisory panel held off recommending approval of the company’s cancer antibody therapy 131I-omburtamab.
Omburtamab is an iodine-131 radiolabeled murine monoclonal antibody indicated for treatment of CNS/leptomeningeal metastasis (LM) from neuroblastoma. Omburtamab is designed to work by binding to the B7-H3 (also known as cluster of differentiation 276, CD276) antigen, which is expressed on the surface of neuroblastoma tumor cells. Y-mAbs licenses the antibody from Memorial Sloan Kettering Cancer Center.
The FDA’s Oncologic Drugs Advisory Committee (ODAC) voted 16-0 that Y-mAbs had not provided sufficient evidence to conclude that omburtamab improved overall survival despite positive results from two studies, the single-arm, Phase I Study 03-133 trial, and the single-arm Study 101, which assessed the safety and efficacy of omburtamab in children with neuroblastoma with relapse in the CNS including parenchymal or LM metastases. Results from study 03-133 were compared with an external control constructed from data from the Central German Childhood Cancer Registry (CGCCR).
ODAC sided with FDA staffers, who raised numerous concerns in the briefing document provided to advisory panel members. Among them:
- Substantive differences between study and control populations that limited the ability to attribute survival differences to the effect of omburtamab.
- A substantial shrinkage of differences in survival between the Study 03-133 and CGCCR populations after adjusting for the number of post-CNS/LM relapse CNS-directed therapy modalities,
choice of index date, and the era of therapy.
- No patient in Study 101 demonstrated a response that could be unequivocally attributed to omburtamab.
“We are disappointed by the outcome of today’s meeting, as patients with CNS/leptomeningeal metastasis from neuroblastoma are in need of effective and safe treatment options,” Y-mAbs Interim president and CEO Thomas Gad said in a statement. “Y-mAbs is committed to working closely with the FDA on their review of the Biologic License Application (BLA) for omburtamab ahead of their decision.”
Three analysts responded to the FDA setback and Y-mAbs’ statement by throwing some proverbial shade at the company.
Guggenheim analyst Ezter Darout, PhD, noted that ODAC’s recommendation made it unlikely that the FDA would approve a priority review voucher for omburtamab that he projected would be valued about $70 million in net proceeds, according to a research note reported by Benzinga. Darout cut the firm’s price target on Y-mAbs 31%, from $26 to $18, but maintained its “buy” rating.
At HC Wainwright, Robert Burns, a managing director and Senior Healthcare Analyst slashed that firm’s price target for Y-mAbs by 70%, from $63 to $19, concluding in a research note reported by several Wall Street news outlets that his firm could not be assured that Y-mAbs could, or would be able to, address concerns raised by ODAC. Burns predicted that the FDA would issue a Complete Response Letter rebuffing Y-mAbs’ BLA within coming weeks.
Wedbush analyst David Nierengarten, PhD, downgraded Y–mAbs from Outperform to Neutral and cut its price target on the company’s shares by 71%, from $21 to $6. Nierengarten is a senior analyst covering small-mid cap biotech stocks with a heavy focus on oncology, rare disease and gene therapy
Y-mAbs shares fell further on Tuesday, declining 7% to $3.35, and dipped another 2% to $3.28 at the close of trading Wednesday.
CanSino royale: shares zoom 170% on inhaled COVID vaccine
CanSino Biologics (6185.HK and CASBF) shares rebounded from recent months’ lows—indeed surging by the largest amount since the company went public in 2019—after announcing Wednesday on its official social media feed that 13 cities in China’s Jiangsu province were gearing up to start using the company’s inhaled COVID-19 vaccine.
The inhaled vaccine, called Convidecia Air, is an aerosol version of CanSino’s single-shot vaccine based on an adeno-associated virus serotype 5 (AAV5) vector. CanSino asserts that Convidecia Air is the world’s first inhaled vaccine to be indicated for COVID-19, which originated in China. COVID-19 continues to trigger regional lockdowns as authorities scramble to enforce the country’s “Zero-COVID” policies carried out by Communist Party leader Xi Jinping, who has defended the measures as essential to saving lives.
The 13 cities would be following the lead of Shanghai, whose booster vaccination program includes Convidecia Air following approval by authorities, specifically the Joint Prevention and Control Mechanism of the State Council of China. Earlier this year, China’s National Medical Products granted CanSino an Emergency Use Authorization for the inhaled vaccine as a booster dose.
CanSino’s shares on the Hong Kong Stock Exchange rocketed 61% on Wednesday, from HK$ 86.30 ($10.99) to HK$ 141 ($17.96), capping an eight-day rally that has seen those shares nearly triple in price, surging more than 170%. The company’s U.S. shares, traded over-the-counter, leaped 67% on Wednesday, rising from $9.26 to $15.49.
“We believe the recent stock reaction was unwarranted gauging the current market potential of the inhalable vaccine,” Jefferies analyst Christopher Lui wrote Wednesday in a research note. He downgraded the firm’s rating on CanSino’s Hong Kong shares from Hold to Underperform, with a price target of HK$ 106 ($13.50).
Lui based his pessimism on Jefferies’ projection that the inhaled vaccine’s average selling price will be RMB 40 ($5.47) per dose, with Cansino taking 50% market share of a 75% booster penetration rate within the eligible population of 538.5 million people who have yet to have a booster (of which 400 million are fully vaccinated). According to the firm, that implies sales for CanSino of RMB 8 billion ($1.093 billion).
However, Lui also noted that CanSino revenue during the third quarter fell 92% year-over-year, to RMB 77.6 million ($10.6 million) due to weak demand for COVID vaccines. The company booked an asset impairment charge of RMB 526 million (about $71.9 million) on its COVID vaccine inventory.
Voluntary enrollment pause trips Instil Bio
Instil Bio (TIL) shares tumbled 37% from $5.25 to $3.30 on Monday, the day the company announced it was voluntarily pausing enrollment of ongoing clinical trials for its two clinical-phase pipeline candidates, ITIL-168 and ITIL-306. The company said the enrollment pauses followed a decrease in the rate of successful manufacturing of ITIL-168, resulting in the inability to dose some patients whose individual product of the drug was not successfully manufactured.
Instil said it has begun an “end-to-end” analysis of its manufacturing processes, after which it “plans to take corrective actions to improve the rate of manufacturing success and resume the study.” As part of that analysis, Instil added, it also voluntarily paused enrollment in an ongoing Phase I trial of ITIL-306, even though no manufacturing failures had been seen to date.
“We think the stock will likely be under pressure in short term and recover once we get certainty on the timing of trial restart,” Jefferies analyst Kelly Shi, PhD, wrote Monday in a research note. Shi and colleagues lowered the firm’s price target on Instil shares from $29 to $22.
Also souring on Instil Bio was Baird, where Senior Research Analyst Jack K. Allen, CFA, lowered the firm’s price target from $31 to $24, reasoning that the voluntary pause will push back Instil’s timeframe for launching ITIL-168.
“While this is clearly disappointing news given the fact that Instil is already playing catch-up in the TIL space, we do see reason to believe that Instil management feels they can rapidly correct the issue given their guidance of an early 1Q23 manufacturing update (which only allows for ~8 weeks of investigation).” Allen wrote in a research note. “Based on our preliminary conversations with management it does not appear the manufacturing issues are related to unique aspects of Instil’s manufacturing approach which include upfront cellular digestion and cryopreservation of the tumor tissue.”
“Should it be the case that Instil is able to rapidly reinitiate enrollment in these studies, and see subsequent manufacturing success, we see room for shares to rebound in the coming quarters,” Allen added.
Instil focuses on developing tumor infiltrating lymphocyte (TIL) therapies for cancer. The company trades its shares on the Nasdaq Global Select Market under the symbol “TIL.”
“This pause in enrollment provides us an opportunity to refine our processes and enable us to manufacture and deliver TIL therapies to patients with no other treatment options,” Instil Bio CEO Bronson Crouch said in a statement. We have assembled a world-class technical operations organization and leadership team to address the challenges associated with manufacturing these therapies.”
Shi reported that according to management, the manufacturing issue happened in a row to several patients “and so far only to one tumor type, which we speculate is in melanoma.
“Based on this info, we do not think it is a tumor biopsy accessibility issue and should not affect more tumor types,” Shi wrote. “Mgmt [Management] believes this is not tumor specific and narrowed down the issue likely to one step of the manuf[acturing] process.”
Instil said it intends to provide an update on the manufacturing analysis by early Q1 2023. The Company confirms its previously disclosed cash runway into 2025 upon the successful completion of a potential sale-leaseback transaction of its Tarzana manufacturing facility.
A pre-specified safety analysis conducted as part of the Phase II/III DELTA-1 trial (NCT05050006) assessing ITIL-168 in melanoma has been conducted on patients who received the drug. The analysis did not identify any unexpected safety issues, according to the company.
ITIL-168 is also under study in DELTA-2 (NCT05393635), a Phase I trial assessing the drug in combination with Merck & Co.’s cancer immunotherapy blockbuster Keytruda® (pembrolizumab) in non-small cell lung cancer (NSCLC), head and neck squamous cell carcinoma (HNSCC), and cervical cancer.
Instil said it had notified the FDA and regulators in Canada and the UK of the enrollment pauses: “No regulatory agencies, including the FDA, have notified the Company of a clinical hold in any of its clinical trials.”
Lead product’s phase III triumph lifts Actinium
Actinium Pharmaceuticals (ATNM) shares jumped 39% on Monday, from $9.73 to $13.54, after the company announced positive topline results from its Phase III SIERRA trial (Study of Iomab-B in Elderly Relapsed or Refractory AML; NCT02665065) for its lead product candidate Iomab-B. Iomab-B met the pivotal study’s primary endpoint of statistically significant and durable complete remission (dCR) of 6 months post initial remission after a bone marrow transplant in patients treated with Iomab-B compared to patients treated with conventional care.
Iomab-B is a first-in-class targeted radiotherapy intended to improve patient access to potentially curative bone marrow transplant by simultaneously and rapidly depleting blood cancer, immune and bone marrow stem cells that uniquely express CD45. SIERRA is a randomized, multi-center, controlled study designed to compare Iomab-B as a conditioning regimen prior to a bone marrow transplant versus a control arm which allowed all current means of conventional care, with the intent to transplant these patients.
“Our recently strengthened team is executing to enable our mission to disrupt the field of bone marrow conditioning with Iomab-B, first in r/r AML [relapsed or refractory acute myeloid leukemia] and then by building upon its robust prior clinical results in several hematological diseases,” Sandesh Seth, Actinium’s Chairman and CEO, said in a statement. “We look forward to sharing additional clinical data from the SIERRA trial by year end.”
Seth’s “recently strengthened team” remark refers to the company’s recent appointment of Caroline Yarbrough as Chief Commercial Officer. Yarbrough joined Actinium from Novartis, where she most recently served as Portfolio General Manager, US Oncology, with full profit-and-loss responsibility of a diverse portfolio of brands and development assets with revenues of over $1 billion.
Earlier, Yarbrough led the chronic myelogenous leukemia (CML) portfolio, a billion-dollar business comprising TASIGNA® and SCEMBLIX®. She also led strategic account management during the launch period for KYMRIAH®, the first approved CAR-T cell therapy.
Investors reacted well to Yarbough’s hiring, sending shares bouncing back 9% to a close of $14.41 on Wednesday—Actinium’s highest share price in more than two years—from a profit-taking 2% dip Tuesday, when shares fell to $13.25.
“In our view, Iomab-B has the potential to change the treatment paradigm for elderly AML patients who have active disease. These patients are currently unable to access a potentially curative bone marrow transplant as chemotherapy based conditioning regimens are either unsafe or ineffective,” Seth added. “The number of patients who fall into this category far outnumber those patients in remission who are currently transplanted and thus Iomab-B, if approved, has the potential to set a new standard of care and greatly expand the eligible patient pool.”
Peak Bio shares slide after SPAC merger
Following a special purpose acquisition company (SPAC) deal that merged Peak Bio Co. Ltd. with blank-check company Ignyte Acquisition Corp., the newly-combined Peak Bio Inc. (PKBO) marked the first day of trading Wednesday with a 41% plunge that sent its shares down from $13.05 to $7.70—a reflection of just how much the market for publicly-traded biotech stock continues to reel, a year into the bear market.
Those shares continued to shrivel in early trading Thursday, falling another 36% to $4.45 as of 10:28 a.m.
South Korea-based Peak Bio focuses on developing drugs to treat oncology and inflammatory diseases. The company’s pipeline is led by PHP-303, an oral QD, reversible and highly selective small molecule acquired from Bayer and ready to enter Phase II in Alpha-1 antitrypsin deficiency (AATD). PHP-303 is designed to work by inhibiting a bioactive form of neutrophil elastase (NE). As a fifth-generation NE inhibitor, PHP-303 addresses toxicity and efficacy shortfalls from previous generation NE inhibitors, according to Peak Bio.
The company’s pipeline also includes an antibody drug conjugate (ADC) platform focused on developing therapies for oncology indications. Peak Bio’s approach to ADCs engages the immune system to enhance tumoricidal activity, an approach designed to reduce the number of treatment cycles and improving toxicity with a proprietary approach towards generating novel toxins.
Peak Bio says its most advanced ADC candidate, which targets Trop2, has shown superior linker stability and in vivo activity compared to an unnamed FDA-approved competitor with superior specificity to cancer cells and a unique ability to generate neoepitopes and synergize with immuno-oncology therapies. The company plans to Fund toxin studies in the lead ADC program, with the goal of an IND submission in the second half of 2023 and the start of a Phase Ia trial in 2024
Other uses for proceeds from the SPAC deal, according to Peak Bio:
- Fund and begin a Phase II AATD Adaptive Design study in 2022, with data expected to be read out in the first half of 2024
- Apply for a Department of Defense grant to fund a Phase II study of PHP-303 in ARDS, with an IND submission set for the first half of 2023
- Conduct research and development to identify new ADC toxins
Investors consisting of existing Peak Bio stockholders and the firm Palo Alto Investors committed to the transaction by participating in a $25 million common stock private investment in public equity (PIPE) at a purchase price of $10 per share. Also among participating investors was Peak Bio’s CEO, Hoyoung Huh, MD, PhD, a serial entrepreneur/investor with board seats on several public and private biotech companies.
In addition to the $25 million from the PIPE, Peak Bio is expected to have approximately $57.5 million in cash held in Ignyte’s trust account (assuming no Ignyte stockholders exercise their redemption rights at closing), for a total of more than $82.5 million in gross proceeds. The SPAC transaction valued the combined company at a pro forma equity value of $278 million, based on a $10 share price and no shareholder redemptions.