Seattle Genetics – Positive read-through from Roche’s investor day

Roche’s investor day, held last week, gave Seattle Genetics’ (SGEN) investors reasons for optimism. Roche has 9 antibody drug conjugates (ADC) in clinical testing: T-DM1, powered by Immunogen’s (IMGN) technology and 8 additional ADCs (in phase I) that are based on Seattle-Genetics’ technology. These ADC programs are expected to have data readouts in the coming year, making them Seattle Genetics’ major near-term growth opportunity. Following last week’s event, it is now clear that at least 5 of the 8 ADCs are active in cancer patients.

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Biotech Portfolio Updates – Immunogen, Array and Seattle Genetics

Immunogen becomes a $1B company

Immunogen (IMGN) concluded the week with a market cap of ~$1B, up 200% in less than a year. This valuation is quite unusual for a company that ascribes the vast majority of its value from a 3-5% royalty stake in a single drug – Roche’s T-DM1. T-DM1, which utilizes Immunogen’s antibody-drug conjugate (ADC) technology, comprises of Herceptin conjugated to a drug payload. It is in two phase III trials and multiple phase II studies in breast cancer. If proven effective, many believe T-DM1 will eventually replace Herceptin, at least in certain treatment lines.

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