Nasdaq Biotech Index Gains As Diversa Jumps On High Volume
The NBI gained almost 1.5% on the day as biotechnology stocks generally fared very well.
Diversa Corporation (DVSA) gained almost 20% at the end of regular hours trading with over one million shares trading hands, with an especially big trade just before the bell rang. The average daily volume is just over 150,000 shares.
It would be interesting to see if the company is on the verge of a press release. Diversa is on our watch list for tomorrow’s openining bell.
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Transition And Elan To Develop Alzheimer’s Drug
Transition Therapeutics (TSX: TTH.TO) entered into an agreement with Elan Corporation (ELN) to co-develop and commercialize Alzheimer’s drug AZD-103.
Transition will recieve $15 million U.S. in upfront payments, and future milestone payments of up to $185 million U.S. depending on regulatory approvals.
AZD-103 is a small molecule compound that inhibits beta-amyloid buildup shown to be a key pathological sign of Alzheimer’s. The drug is currently in phase 1 clinical trials.
Transition is the second Canadian biotech firm to announce big news in just two days, as AnorMED (ANOR) agreed to a cash buyout offer from Millenium (MLNM) and rejecting an offer from Genzyme (GENZ).
Canada boasts world class research facilities, easier to collaborate with than distant over seas nations, and might be seen as relatively cheap for U.S. firms.
Look for Transition shares to skyrocket on the Toronto Stock Exchange (TSX)
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EpiCept Announces Positive Results for AZIXA In Brain Cancer
EpiCept Corporation (EPCT) announced that its drug AZIXA showed positive results in a phase 1 clinical trial in brain cancer patients. The study was conducted by EpiCept’s partner Myriad Genetics (MYGN).
Myriad was able to achieve the drug’s maximum tolerable dosage in patients with cancer that has metastasized to the brain. Results also showed a reduction in tumor size, suggesting that AZIXA exhibits some activity. Myriad plans to bring the drug to phase 2 trials soon after it finalizes the therapeutic dosage.
EpiCept gained more than 20% to end trading at $2.04 a share, while Myriad gained 1.90% to $24.18.
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Millenium Beats Genzyme To AnorMED’s Stem Cell Drug
Management of Canadian biotech darling AnorMED, Inc (ANOR) agreed to a cash buyout offer from Millenium Pharmaceuticals (MLNM) for $12 U.S. a share totaling $515 million. That represents a premium of 21% over Monday’s closing price, and a whopping 40% premium to a hostile $8.55 bid by Genzyme (GENZ) that AnorMED and its investors declined.
The battle, which Millenium seems to have won, was for AnorMED’s MOZOBIL, a small molecule chemokine antagonist that has been shown to mobilize stem cells from bone marrow. MOZOBIL is currently in phase 3 clinical trials.
But the attraction for AnorMED was fueled by the company’s earlier success with FOSRENOL, a treatment for high phosphate levels in the blood of patients undergoing dialysis for chronic kidney failure.
World wide rights to FOSRENOL was sold in 2004 to Shire Pharmaceuticals Group. AnorMED has since gained $19 million U.S. in milestone payments from Shire as the drug has since been approved in the U.S., Germany, and the United Kingdom.
Millenium is banking on the little company’s past experience with taking a drug from early research and through clinical trials, and eventual approval. MOBOZIL fits perfectly with Millenium’s oncology and hematology sales unit.
But Millenium currently has just over $600 million in cash, and could possibly register a stock offering to fund the acquisition. Millenium has yet to become the biotech giant that many predicted during the roaring 90s.
Genzyme is a $17 billion biotech behemoth that posted a profit of more than $400 million last year. So why did Genzyme offer such a small bid for AnorMED? Some believe Millenium offered too much, especially since MOBOZIL has yet to be approved. Millenium is taking on a gamble that could potentially cost the company more in market cap than the cash it is offering.
There might be a sound financial reason for Genzyme’s offer that Millenium is not aware of.
Time will tell.
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Today’s Top Stocks in Biotech and Healthcare
Biotechnology
ACORDA THERAPEUTICS [ACOR] +29.41%
ANORMED INC [ANOR] +28.04%
HESKA CORPORATION [HSKA] +12.59%
BIOCRYST PHARM INC [BCRX] +10.62%
SANGAMO BIOSCIENCE [SGMO] +10.11%
Diagnostic Substances
EPICEPT CORPORATION [EPCT] +20.00%
AVALON PHARMACEUTIC [AVRX] +4.56%
NEOGEN CP [NEOG] +4.48%
GENE LOGIC INC [GLGC] +4.00%
PALATIN TECH INC [PTN] +4.00%
Drug Delivery
ALKERMES INC [ALKS] +4.58%
GENEREX BIOTECH CORP [GNBT] +4.58%
BENTLEY PHARMACEUTIC [BNT] +1.98%
NOVADEL PHARMA INC [NVD] +1.69%
MATRIXX INITIATVS [MTXX] +0.85%
Drug Manufacturers
SIGA TECH INC [SIGA] +53.79%
MARSHALL EDWARDS [MSHL] +15.66%
ALEXZA PHARMACEUTICA [ALXA] +9.65%
UNIGENE LABS INC [UGNE.OB] +6.30%
MGI PHARMA INC [MOGN] +6.02%
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Genentech’s Cancer Drug Avastin Recieves New Label Warning
The FDA noted on its website late Monday that it has included new warnings on Avastin, the blockbuster cancer drug developed and marketed by biotech giant Genentech (DNA).
The new warnings include nasal septum bleeding and brain-capillary leakage as about 7 patients have been afflicted by this side effect.
The company explains that such a side effect is quite rare, only 0.1% of the 60,000 patients using Avastin have reported these symptoms, which are reversible.
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Biolase Granted New Patent for Its Dental and Medical Laser
BIOLASE Technology (BLTI) today announced the the U.S. Patent and Trademark Office has granted the company a new patent covering its proprietary pulse laser technology, including diode excitation, pulse structures and additional soft tissue usage.
U.S. patent no. 7.108.693 B2 includes 78 claims all related to Biolase’s laser pulse technology.
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Acorda Proves It Is Not Smart To Invest In Small Biotech
Shares of Acorda Therapeutics (ACOR) absolutely skyrocketed today, by more than 280% by day’s end, after the company announced that its Multiple Sclerosis drug Fampridine-SR significantly increased walking speed in MS patients compared to those taking placebo.
MS is a debilitating neural condition where the protective myelin sheath surrounding neurons, the cells of the nervous system, degenerates and limits the neural network responsible for control of movement.
While the science is exciting and full of potential, it is the financial surprise that has taken center stage. How could a stock almost quadruple in price in just one day’s trading? Wouldn’t it suggest that Wallstreet tremendously missed the boat on this one? And if so, how could a whole bunch of industry analysts who follow clinical trials like teenagers pumping up a penny stock get caught by surprise?
There are a lot of questions that need answers, but let us start with this question; why has Acorda’s share price been sliding over the last year? In fact, it was at an all-time low on Friday, the very last day of trading before the big news hit?
It seems Acorda has left a bad taste in the hungry mouths of investors from a couple of earlier setbacks. An earlier MS phase 2 trial showed poor results, while another phase 3 trial for spinal cord injuries had failed. Poor results and disappointments do not sit well with biotech investors. They are a sensitive bunch, quick to find another biotech stock du jour.
In addition, Pantheon International had begun selling off a large chunk of shares in Acorda over the last week of August. It seemed that the company’s stock was headed to the land of no return. This land is currently being occupied by such former biotech stars as Alteon (ALT), Advanced Tissue Sciences (ATISZ), and Genta (GNTA). Although Genta has had some good news lately as a group of institutional investors placed $16 million in company stock, no doubt expecting a positive review by an FDA panel in October.
Looking at the former stars mentioned above one can see a pattern. Great hype, coupled with decent early clinical trials, and eventually fizzled down as late stage results disappointed and the ever restless biotech investors jumped over board.
So what was so different with Acorda that the trend was broken on Monday? Data re-analyzation of course! Acorda took another look at its clinical trial data, sliced and diced and came up with a surprising conclusion; the data looks good! It was a conclusion that surprised not only analysts and institutional investors, but also the company itself!
If the company’s own scientists cannot accurately predict the outcome of trial results, or at least have some sort of idea as to whether the numbers would look positive or grim, then how can any investor justify placing hard earned money into the venture?
I pick on Acorda of course, but this is a common theme in biotechnology investing. It is a rarity to hit upon a diamond stock, the one which grows from a few scientists to a multi-billion dollar behemoth, even with sound and diligent research.
The very fact that shares of Acorda skyrocketed today proves investing in biotech is a volatile, unpredictable, and dangerous game. Why invest in phase 1 trials, when you can invest in phase 2? Why phase 2 when you can be only one step away in phase 3? And why invest in phase 3 when the final approval and marketing of a drug can still significanly bring great riches to a company and its investors?
What if the FDA calls for one further trial for Acorda’s Fampridine-SR, or worse still, does not like the data, then what? I would hate to even imagine the result of such news.
Why not wait till the FDA gives its blessing, and the company ships its first boxes of Fampridine-SR before placing your hard earned money on the table?
Or how about an even more outrageous idea; try to invest in a company that has made a profit!
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Today’s Top Stocks in Biotech and Healthcare
Biotechnology
ACORDA THERAPEUTICS [ACOR] +282.88%
LIPIDVIRO TECH INC [LPVT.OB] +56.00%
GPC BIOTECH AG [GPCB] +34.07%
IDERA PHARMACEUTICAL [IDP] +7.94%
INSMED INC [INSM] +7.52%
Diagnostic Substances
NYMOX PHARM CORP [NYMX] +19.40%
AVALON PHARMACEUTIC [AVRX] +5.62%
ORCHID CELLMARK INC [ORCH] +5.56%
IMMUCELL CP [ICCC] +3.96%
AKORN INC [AKN] +3.68%
Drug Delivery
MATRIXX INITIATVS [MTXX] +7.67%
COLUMBIA LABS INC [CBRX] +4.69%
SYMBOLLON PHARM CL A [SYMBA.OB] +4.55%
NOVEN PHARMACEUTIC [NOVN] +3.78%
ALKERMES INC [ALKS] +2.81%
Drug Manufacturers
SPECTRUM PHARMA INC [SPPI] +45.56%
PHARMION CORP [PHRM] +19.99%
ADVANCIS PHARMA CP [AVNC] +6.94%
DURECT CORP [DRRX] +6.70%
DEPOMED INC [DEPO] +6.11%
YM BIOSCIENCES INC [YMI] +5.08%
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Acorda Therapeutics Soars Over 280% On Multiple Sclerosis Results
Shares of Acorda Therapeutics (ACOR) gained more than 280% at end of regular hours trading, and is up more than 5% in the after-hours session, as the company announced earlier in the day that its phase 3 MS clinical trial met primary endpoint.
The 3 months average daily volume is almost 30,000 shares a day, while today’s action saw almost 25 million shares trade hands!
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