Post by tomsylver on Jun 28, 2017 7:10:03 GMT
2 More Small Biotechs For The Rest Of 2017
Jun. 27, 2017 3:26 PM ET|17 comments| About: Dynavax Technologies Corporation (DVAX), PTLA
Bret Jensen
Specializing in biotech stocks, Small Caps, managing optimized portfolios
MARKETPLACEThe Biotech Forum
(33,050 followers)
Summary
The biotech sector after meandering in a tight trading range throughout most of 2017, has recently broken out on the upside.
This rally could have some legs given the sector has vastly underperformed the overall market over the past two years.
Here are two small biotech stocks that have upcoming catalysts this summer and could reward shareholders through year end 2017.
Any fool can know. The point is to understand.
—Albert Einstein
After two years of vastly underperforming the overall market, last week the biotech sector rose some 10% in its best weekly performance in several years. In so doing, the major biotech indices crashed through upward resistance levels that had been firmly in place since the very end of 2015. Even after the rally, biotech is some 20% below its previous peak in July of 2015.
Back in February, I posted an article entitled "2 Must Have Biotechs For The Rest Of 2017" about two small biotechs I thought were undervalued and had upcoming catalysts. One of these, Aratana Therapeutics (PETX) is down some 10% since then. The other, Omeros (OMER) is up some 80%, so overall it has been a good call to this point.
Today we look at two more small biotechs that have catalysts coming up this summer and could have good runs through year end 2017.
Let’s start with Portola Pharmaceuticals (PTLA),which already has had a nice year. In fact, the stock has tripled since we gave it a big ‘Thumbs Up’ in December of last year. The shares surged again last week as the FDA granted approval to its compound BEVYXXA (betrixaban) which is an extended-duration anticoagulant, for the prevention of venous thromboembolism {VTE} in hospitalized at-risk adult patients.
Another huge potential catalyst is coming up. The company intends to file a Biologic License Application {BLA} for a compound called Andexxa by end of this month. This is an important drug for the company and the industry. It is geared to be the first universal antidote to the new anticoagulants that are displacing old school drugs like warfarin. These included Eliquis and Xarelto. About one to four percent of individuals that use these drugs end up in the emergency room or hospital, or some 80,000 ER visits a year. Having a universal antidote will ease concerns about using these sorts of anticoagulants and will have to be stocked by every hospital and ER, a potentially lucrative market.
Given anticoagulants are widely prescribed, I could see Portola becoming a logical buyout target by a larger player with an established sales force. This may be one reason that Oppenheimer, Morgan Stanly, Cowen & Co. and Citigroup all reissued Buy ratings yesterday with price targets proffered between $66 and $78 a share. Cowen raised their price target from $45 to $70 and Citigroup went from $51 to $78 while mentioning Portola as a potential takeover candidate.
Moving considerably out on the risk/reward scale, Dynavax Technologies (DVAX) is going to be a big mover this summer. The question is whether the move will be up or down. The stock (above) has behaved much better since Dynavax disclosed early staged trial results from its oncology compound 'SD-101' at the big ASCO conference in Chicago earlier this month. That study showed that SD-101 combined with Merck's (MRK) blockbuster Keytruda showed much better outcomes treating advance melanoma than Keytruda did alone. Eventually SD-101 might be worth more than the current market capitalization of Dynavax currently (~$500 million) and that compound will move into mid-stage trials this year.
However, the near term asset investors will be watching is the company's hepatitis B vaccine 'Heplisav-B'. This biologic has had a long running saga with the FDA trying to garner approval. Given new leadership at the FDA, I think the third time will be the charm for this important vaccine.
In a 14,000 subject trial the vaccine showed better protective qualities (~95% versus ~81%) than the current standard of care. It can also be effective in two doses over a month rather than the current regimen of three doses over six months. This should radically improve what has been a dismal (~55%) compliance rate with the current standard hepatitis B vaccine.
The hepatitis B vaccine space is an over $500 million market just in the United States. If approved, I expect the stock to trade up into the mid-teens. Heplisav-B has an Ad Comm Panel on July 28th and a PDUFA date of August 10th.
Both names are worth owning and watching as we head into the long hot summer.
A friend is someone who knows all about you and still loves you.
—Elbert Hubbard
Author's note: To get these types of articles and Instablogs on attractive biotech and pharma stocks as soon as they are published, just click on my profile, hit the big, orange "Follow" button, and choose the real-time alerts option.
Thank you and happy hunting.
Disclosure: I am/we are long DVAX, OMER, PETX, PTLA.
Jun. 27, 2017 3:26 PM ET|17 comments| About: Dynavax Technologies Corporation (DVAX), PTLA
Bret Jensen
Specializing in biotech stocks, Small Caps, managing optimized portfolios
MARKETPLACEThe Biotech Forum
(33,050 followers)
Summary
The biotech sector after meandering in a tight trading range throughout most of 2017, has recently broken out on the upside.
This rally could have some legs given the sector has vastly underperformed the overall market over the past two years.
Here are two small biotech stocks that have upcoming catalysts this summer and could reward shareholders through year end 2017.
Any fool can know. The point is to understand.
—Albert Einstein
After two years of vastly underperforming the overall market, last week the biotech sector rose some 10% in its best weekly performance in several years. In so doing, the major biotech indices crashed through upward resistance levels that had been firmly in place since the very end of 2015. Even after the rally, biotech is some 20% below its previous peak in July of 2015.
Back in February, I posted an article entitled "2 Must Have Biotechs For The Rest Of 2017" about two small biotechs I thought were undervalued and had upcoming catalysts. One of these, Aratana Therapeutics (PETX) is down some 10% since then. The other, Omeros (OMER) is up some 80%, so overall it has been a good call to this point.
Today we look at two more small biotechs that have catalysts coming up this summer and could have good runs through year end 2017.
Let’s start with Portola Pharmaceuticals (PTLA),which already has had a nice year. In fact, the stock has tripled since we gave it a big ‘Thumbs Up’ in December of last year. The shares surged again last week as the FDA granted approval to its compound BEVYXXA (betrixaban) which is an extended-duration anticoagulant, for the prevention of venous thromboembolism {VTE} in hospitalized at-risk adult patients.
Another huge potential catalyst is coming up. The company intends to file a Biologic License Application {BLA} for a compound called Andexxa by end of this month. This is an important drug for the company and the industry. It is geared to be the first universal antidote to the new anticoagulants that are displacing old school drugs like warfarin. These included Eliquis and Xarelto. About one to four percent of individuals that use these drugs end up in the emergency room or hospital, or some 80,000 ER visits a year. Having a universal antidote will ease concerns about using these sorts of anticoagulants and will have to be stocked by every hospital and ER, a potentially lucrative market.
Given anticoagulants are widely prescribed, I could see Portola becoming a logical buyout target by a larger player with an established sales force. This may be one reason that Oppenheimer, Morgan Stanly, Cowen & Co. and Citigroup all reissued Buy ratings yesterday with price targets proffered between $66 and $78 a share. Cowen raised their price target from $45 to $70 and Citigroup went from $51 to $78 while mentioning Portola as a potential takeover candidate.
Moving considerably out on the risk/reward scale, Dynavax Technologies (DVAX) is going to be a big mover this summer. The question is whether the move will be up or down. The stock (above) has behaved much better since Dynavax disclosed early staged trial results from its oncology compound 'SD-101' at the big ASCO conference in Chicago earlier this month. That study showed that SD-101 combined with Merck's (MRK) blockbuster Keytruda showed much better outcomes treating advance melanoma than Keytruda did alone. Eventually SD-101 might be worth more than the current market capitalization of Dynavax currently (~$500 million) and that compound will move into mid-stage trials this year.
However, the near term asset investors will be watching is the company's hepatitis B vaccine 'Heplisav-B'. This biologic has had a long running saga with the FDA trying to garner approval. Given new leadership at the FDA, I think the third time will be the charm for this important vaccine.
In a 14,000 subject trial the vaccine showed better protective qualities (~95% versus ~81%) than the current standard of care. It can also be effective in two doses over a month rather than the current regimen of three doses over six months. This should radically improve what has been a dismal (~55%) compliance rate with the current standard hepatitis B vaccine.
The hepatitis B vaccine space is an over $500 million market just in the United States. If approved, I expect the stock to trade up into the mid-teens. Heplisav-B has an Ad Comm Panel on July 28th and a PDUFA date of August 10th.
Both names are worth owning and watching as we head into the long hot summer.
A friend is someone who knows all about you and still loves you.
—Elbert Hubbard
Author's note: To get these types of articles and Instablogs on attractive biotech and pharma stocks as soon as they are published, just click on my profile, hit the big, orange "Follow" button, and choose the real-time alerts option.
Thank you and happy hunting.
Disclosure: I am/we are long DVAX, OMER, PETX, PTLA.
