Despite the recent surge in general and biotech indices I still believe we are in the beginning of a significant correction after a 10-year bull market. If a major correction occurs in 2019, I intend to use it and increase exposure to small cap biotechs as I still believe in their long term value proposition.
With respect to stock picking, the thriving biotech IPO market created a dichotomy. On the one hand, investors have a lot to choose from as the IPO class of 2017-18 includes so many high quality biotech companies. On the other, valuations for many companies (especially the ones without clinical validation) appear to be overblown, driven by hype rather than data. Continue reading →
This year’s ASCO marks a second year in a row of relatively uneventful meetings, with very few groundbreaking or practice-changing data. Just like last year’s meeting, there were too many “me too” drugs targeting the same validated targets while results for truly novel MOAs were mostly underwhelming or immature. This stagnation is particularly troubling in light of the huge budgets the industry is pouring into oncology drug development, which used to be a highly capital-efficient sector.
Looking at the different vertical segments, stagnation is apparent across the board with some exception with few kinase inhibitors and BCMA CARs. Continue reading →
After a two-month break here is a recap of key highlights from the September/October time frame. On the menu today: PD-1 controversies at ESMO 2016, Exelixis’ (EXEL) launch in renal cancer, gene therapy data from Abeona (ABEO), long awaited update from Esperion (ESPR) and a positive surprise from Seattle Genetics (SGEN).
ESMO 2016 – Merck wins by a landslide (for now…)
While ESMO is typically secondary in importance to ASCO, this year’s meeting overshadowed its US counterpart (which was relatively quiet to begin with…), generating big headlines in the PD-1 arena. Continue reading →
Although this year’s ASCO contained a limited amount of groundbreaking data, it provided some interesting take-aways and signaled important trends in oncology drug development. Below is my take on a quiet but important meeting.
Immuno-oncology – PD-1 combinations at their infancy
As in previous years, the meeting was dominated by PD-1/PD-L1 antibodies. Now that PD-1 blockers have been tested on every tumor known to mankind (see below a great figure from Merck), focus is shifting to combination regimens with PD-1 as a backbone. Combination partners range from other immune checkpoints to chemotherapy, targeted therapy and radiation. Continue reading →
The biotech sector is having a brutal summer, with major indices (IBB, FBT, XBI) down 15-20% from their July highs. Even after this decline, valuations for most biotech stocks are still rich and need to come down by an additional ~25% in order to become reasonably priced. As my working hypothesis includes a correction (with significant fluctuations) going into 2016, I still plan to have a significant cash position and complement it with leveraged short bio ETFs. Continue reading →
Back in 2010, ADCs were the hottest theme in oncology with the potential to revolutionize cancer treatment. The excitement was based on promising results for Adcetris (Seattle Genetics [SGEN]) and Kadcyla (Immunogen [IMGN]), both of which utilized new and improved ADC technologies. Adcteris and Kadcyla were perceived as the ultimate cancer drugs: They had strong single agent activity and provided meaningful benefit to patients with limited toxicity. All that was left to do was replicating their success with additional antibodies to cover every tumor type. Continue reading →
Below is my traditional end of the year summary and a recap of catalysts for 2015. As always, I did my best to cover the most important events, let me know if I missed anything… I would like to use this opportunity and wish the readers of this blog a happy and prosperous new year.
There was a lot of activity in my coverage universe in the last two weeks, including positive data readouts for three companies and an acquisition announcement. However, of the four cases, only two resulted in share appreciation.
Ambit – To keep or not to keep (the CVR)
Two weeks ago, Ambit (AMBI) agreed to be acquired by Daiichi Sankyo in a deal that included a $15 upfront payment and $4.5 in Contingent Value Right (CVR) per share. The CVR represents a milestone-like mechanism in which Ambit’s shareholders may eventually get additional payments equal to 30% of the initial purchase price. Continue reading →
AML (Acute myeloid leukemia) remains one of the few blood cancers in which no progress has been made for decades. This is in contrast to other blood cancers where novel treatments have turned fatal conditions into chronic diseases with long term remissions. Prominent examples are CML, which today has a low mortality rate and multiple myeloma where median survival is approaching 8 years and counting. The recent launch of Imbruvica and Gazyva followed by the anticipated approval of ABT-199 is expected to have a similar impact on CLL as well as on certain subtypes of B cell lymphoma. Continue reading →
Below is my ASCO 2014 preview (better late than never…). I tried to make this recap as comprehensive as possible but it is practically impossible to cover all the interesting stuff (let me know if I missed anything dramatic). Unlike last year, I decided to group interesting abstracts based on mechanism of action rather than companies in order to provide a more holistic perspective. On top of attending the conference itself, I will try to attend as many analyst events as possible (this year I have Clovis, Roche, BMS and Incyte on my list) and include them in my post-ASCO write-up. Continue reading →