Health and Healthcare
9 Companies Bracing for Big ASCO Reactions
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This year marks the 54th annual meeting of the American Society of Clinical Oncology (ASCO). Biotech and pharmaceutical companies will descend on Chicago for a five-day all-out conference (June 1 to 5) on the development of cancer treatments. This is known as the world’s largest clinical cancer conference, and it always delivers new results on clinical trials and updated treatments in the field. Not to mention, this conference has the potential to make or break companies in the space, depending on their results.
The theme for this year’s conference is “Delivering Discoveries: Expanding The Reach of Precision Medicine,” which focus on making precision medicine a reality by driving progress and expanding its reach so that every patient can have the opportunity to benefit. This year is expected to see over 39,000 attendees, counting among them the world’s best oncologists, researchers and scientists.
Many of the abstracts for ASCO already have been released and stocks have moved in anticipation. However, still more abstracts will be released the day of the presentation.
24/7 Wall St. takes a look at the ASCO annual meeting each year and picks out the companies that could have the biggest boom or bust at the conference.
Merck & Co. Inc. (NYSE: MRK) will be presenting results of the Keynote-042 trial for Keytruda monotherapy in front-line non-small cell lung cancer (1L NSCLC). This abstract has not been released, but the data is expected to be very impressive and practice-changing, given it was selected to be presented in the main Plenary Session of the meeting. According to Credit Suisse:
We continue to believe this data will help drive upside to Keytruda estimates for 2H 2018 and into 2019. Initial details from KEYNOTE407 in squamous lung cancer abstract show a solid ORR benefit for Keytruda + chemo vs. chemo alone, but we believe survival data (as well as an indirect comparison to Roche’s IMpower131 data) are needed to fully assess the study’s impact. Additional Keytruda data in other tumor types should also support our view that Merck’s I-O opportunity is much broader than just lung cancer, something that we expect to become clearer to investors as we go through ASCO. New Phase 2 data for Lynparza (with AstraZeneca) in combination with Zytiga in prostate cancer and data for Keytruda plus Lenvima (with Eisai) in multiple tumor types should also help investors assign value to recent collaborations that MRK has pursued to broaden out their oncology franchise.
Shares of Merck closed Friday at $59.14 apiece, with a consensus analyst price target of $68.40 and a 52-week trading range of $52.83 to $66.41.
Bristol-Myers Squibb Co. (NYSE: BMY) is looking to present new data from its CheckMate-227 study, which will provide a first assessment of Opdivo plus chemotherapy in 1L NSCLC. Analysts are expecting data for the Opdivo plus Yervoy plus chemo arm at ASCO, but a descriptive analysis in the abstract suggests a progression-free survival (PFS) benefit for Opdivo plus chemo vs. chemo alone. Credit Suisse believes that this should help ease concerns around Opdivo being an inferior drug to Keytruda (at least in this population), but the firm still sees Bristol-Myers being very challenged in gaining traction commercially in 1L NSCLC for the next one to two years.
Shares of Bristol-Myers closed the week at $52.71, with a consensus price target of $59.20 and a 52-week range of $49.96 to $70.05.
Johnson & Johnson (NYSE: JNJ) published impressive data for its FGFR inhibitor erdafitinib in bladder cancer, showing a 70% confirmed overall response rate (ORR) in patients who had received prior immune checkpoint inhibitors. The company already has started a Phase 3 trial in this indication, and the drug has been granted Breakthrough Therapy Designation from the FDA. Based on the data in the abstract, this could be another pharma asset for the company that could drive underappreciated upside.
The stock was last seen at $124.24 per share. It has a 52-week range of $121.28 to $148.32 and a consensus price target of $145.10.
Pfizer Inc. (NYSE: PFE) posted interesting data regarding the combination for Bavencio and crizotinib or lorlatinib, especially in light of an Opdivo plus crizotinib study (CheckMate-370) recently being stopped due to significant liver toxicity. Pfizer also released positive data for Dacomitinib in EGFR plus NSCLC ahead of its September Prescription Drug User Fee Act (PDUFA) date, but analysts see that as a challenging area for Pfizer to gain traction commercially given progress by companies such as AstraZeneca.
Shares of Pfizer closed Friday at $35.64, in a 52-week range of $31.67 to $39.43 and with a consensus analyst target of $39.95.
The abstract from Portola Pharmaceuticals, Inc. (NASDAQ: PTLA) gave a detailed look at data from cerdulatinib, a potentially underappreciated pipeline asset for the company. The efficacy does appear promising, particularly in peripheral T-cell lymphoma and maybe in other indications as well. Analysts would like to see more details on the drug’s safety profile, however, given five patients had Grade 5 infections that were considered related to the study drug. Analysts are waiting for the full data at ASCO before potentially assigning some value to this drug.
Shares of Portola closed out the week at $41.36, with a consensus price target of $60.67 and a 52-week range of $30.10 to $67.10.
Endocyte Inc. (NASDAQ: ECYT) will present data from an additional 20 patients in its Phase 2 study of PSMA-617. The abstract showed results that were in line and better than that seen in first 30 patients in the study. Results from the first 30 patients were recently published in Lancet Oncology, showing a median overall survival (OS) of 13.5 months and median prostate-specific antigen (PSA) PFS of 7.6 months (with latter correlating to survival). Full safety data shows PSMA-617 was well tolerated, with low rates of adverse effects observed. Updated ORR, PSA PFS and OS data will be presented at the meeting.
Shares of Endocyte were last seen at $14.45, with a consensus price target of $17.33 and a 52-week range of $1.17 to $14.86.
24/7 Wall St.Idera Pharmaceuticals Inc. (NASDAQ: IDRA) released updated data from its ongoing Phase 2 study of IMO-2125 plus ipilumumab study in PD-1 refractory melanoma patients, which it will be presenting. The data show a 48% ORR in 10/15 patients (previous update was 50% from 5/10 patients).
Shares of Idera closed Friday at $2.00, with a consensus price target of $4.50 and a 52-week range of $1.32 to $2.87.
MacroGenics Inc. (NASDAQ: MGNX) will present updated data from a combo study of margetuximab with pembro in gastric cancer. Abstract data were consistent with results presented earlier this year at ASCO GI. The latest update shows the best ORR was 16% and disease control rate (DCR) was 54% in 57 evaluable patients, with ERBB2 amplification and PD-L1 positivity predicting response (ORR was 57% and DCR 86% in subset that were ERBB2 and PD-L1 positive). Updated clinical and biomarker data from study are expected at meeting.
Shares of MacroGenics closed out the week at $21.75, with a consensus price target of $33.00 and a 52-week range of $14.36 to $32.74.
Eli Lilly and Co. (NYSE: LLY) released additional data from its Monarch 2 trial for Verzenio, focused on data from women in the pre/peri-menopausal population. The PFS and ORR data appear more impressive in this group, which was about 17% of the total study population. REACH-2 data are positive for Cyramza in patients with advanced liver cancer and also high levels of alpha-fetoprotein.
Shares of Eli Lilly were last seen at $82.07, with a consensus price target of $90.45 and a 52-week range of $81.49 to $89.09.
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