With apologies to Charles Dickens, this week saw the best of times, and the worst of times, for Wall Street’s respective leaders and laggards, as investor appetite for publicly-traded biotech stocks continued to shrink.
Below are just six examples of market volatility. 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.
Bluebird Bio (BLUE)
Bluebird Bio’s plan to eliminate 30% of its workforce, announced Tuesday, touched off yet another decline in the company’s stock price, which has plunged more than 60% since November when the company spun off its oncology programs. Shares fell 9% between Monday and Thursday, two days after Bluebird announced a restructuring plan designed to save the company $160 million over two years—in part by axing an estimated 155 employees (based on the 518-person staff it employed as of January 31, according to the company’s Form 10-K annual report for 2021).
Bluebird said the restructuring is expected to extend its cash runway into the first half of 2023 by slowing down its cash burn to under $340 million through a 35% to 40% percent reduction in operating costs that the company expects to realize by year’s end.
Imara shares slumped 22% on Tuesday after the company said it would halt development of its lead candidate tovinontrine (IMR-687) in sickle cell disease (SCD) and beta-thalassemia, after acknowledging that the small molecule inhibitor of phosphodiesterase-9 (PDE9) failed a pair of Phase IIb trials—Ardent (NCT04474314) for SCD; and Forte (NCT04411082) for beta-thalassemia. Interim data from Ardent showed no significant difference in the median annualized rate of vaso-occlusive crises between high-dose tovinontrine patients and placebo. Worse, interim data from Forte showed “no meaningful benefit” in transfusion burden or improvement in most disease-related biomarkers.
“We plan to discontinue both studies during the second quarter,” Rahul Ballal, PhD, Imara’s President and CEO said. “Moving forward, we plan to consider our strategic options, including development of tovinontrine in heart failure with preserved ejection fraction (HFpEF)” as well as the company’s other pipeline candidate, IMR-261, for red blood cell diseases. Both programs are in preclinical phases.
Inozyme shares rose 14% on Monday, followed by a 39% jump on Tuesday, after the company trumpeted positive preliminary biomarker, safety, and pharmacokinetic (PK) data for its lead candidate INZ-701, an ectonucleotide pyrophosphatase / phosphodiesterase 1 (ENPP1) recombinant fusion protein.
Among the first three patients treated in the Phase I portion of its ongoing first-in-human Phase I/II trial (NCT05030831) assessing INZ-701 in adults with ENPP1 Deficiency, the range of PPi levels measured at six hours after the first dose was 581-1239 nM, an approximately four-fold mean increase from screening across the three patients. The mean PPi level during the 32-day dose evaluation period across the three patients was 1356 nM, an approximately five-fold mean increase from screening across the three patients.
Kaleido Biosciences (KLDO)
Kaleido Biosciences shares cratered, falling 80% in trading Friday as of 2:55 p.m. ET, after the company disclosed in a regulatory filing that its board agreed to wind down and cease all operations—as part of which Kaleido will de-list its shares from The Nasdaq Stock Market. Kaleido immediately terminated its top three executives: President and CEO Daniel Menichella, CFO William Duke, and Chief Scientific Officer Johan van Hykckama Vlieg—and all of its workforce, which stood at 76 employees at year end, according to its Form 10-K annual report for 2021, filed April 1.
Kaleido is a developer of novel Microbiome Metabolic Therapies (MMT™) based on its own platform. On April 4, its researchers posted a preprint in bioRxiv about a Kaleido-developed synthetic glycan supporting a high propionate-producing microbiome, KB39, which they reported can reduce cardiometabolic risk factors and disease in mice: “This approach could be of benefit for the prevention or treatment of cardiometabolic diseases in humans.”
Kaleido said it engaged professional advisors, including an investment banker, to assess strategic options: “Unfortunately the strategic process did not result in the identification of any viable transactions, and given its limited remaining resources, the Company cannot continue operations and believes that the best alternative is an orderly wind-down process.”
The company ended 2021 with cash and cash equivalents totaling $38.5 million, a net loss of $90.3 million (compared with an $81.6 million net loss in 2020), and an accumulated deficit of $364.5 million.
NeoGenomics shares surged 22% on Thursday, capping a turbulent 10 days touched off by the March 29 resignation of Mark Mallon as CEO, sending shares tumbling 30% that day—after the company acknowledged that its first quarter results would likely fall short of its investor guidance issued February 23. The provider of cancer-focused genetic testing services and global oncology contract research services has since withdrawn that guidance, which forecasted consolidated revenue of $530 million to $550 million, and a net loss of between $118 million and $133 million. Soon after Mallon resigned after just 11 months in office, Activist Insight speculated that an activist could demand influence in NeoGenomics’ CEO search or a sale of the company.
NeoGenomics said Mallon’s resignation was mutually agreed upon by him and the company’s board, “This mutual agreement was not the result of any disagreements about strategy with management or the Board, inappropriate action by CEO, or any violation of company policy or any accounting irregularity. The Board has retained Russell Reynolds to conduct a search for the company’s next CEO.
Sunshine Biopharma (SBFM)
Investors basked in the glow of Sunshine’s positive preclinical results, and mRNA more broadly, as the company’s small cap shares more than doubled this week, zooming 148% on Tuesday alone and leaping another 22% on Wednesday. Sunshine said two of its newly designed mRNA molecules were effective at destroying a variety of cancer cells grown in culture, while showing “little or no” cytotoxic effects—though the company did not share data in its announcement.
The cancer cells tested included multi-drug resistant breast cancer cells (MCF-7/MDR), ovarian adenocarcinoma cells (OVCAR-3), and pancreatic cancer cells (SUIT-2). Sunshine said it anticipated filing a patent application “soon” for the new mRNA molecules, which it asserted were readily adaptable for delivery into patients using mRNA vaccine technology.