Ash abstract dump poorly timed for biotech investors
Ash may not have been the only reason for slumping biotech share prices yesterday, but it didn't help. With drug pricing front and centre in a volatile presidential campaign just three trading days away from its conclusion, and news that the US Justice Department might be investigating price fixing in generics drugs, it became a day to move to the sidelines at least until the election has been decided.
Nevertheless, a look at some of the big losers on the release of Ash abstracts reveals that investors had good reason. Trillium Therapeutics and Achillion Pharmaceuticals led the way after signs of toxicity with their phase I projects, although other investor darlings like Spark Therapeutics and Bluebird Bio also suffered.
As this perfect storm hit, the Nasdaq biotechnology index fell to just short of its lowest point of 2016. Depending on which candidate wins the White House and ends up controlling Congress, at least one analyst reckons that a rebound of up to 20% could be seen next week for biotech shares (Congressional control big biopharma risk in 2016 election, November 3, 2016).
The table below lists selected companies disclosing data at Ash whose shares fell yesterday. Many have bounced back today along with the Nasdaq biotech index, as the broader markets rise with positive US employment and wage news.
|Ash movers and the abstracts to watch
|Share price move Nov 3
|Global Blood Therapeutics
|2572 and 1397
|Sleeping Beauty transfer
Not every faller had unequivocally bad news in their Ash abstracts. However, those that had poor showings declined sharply.
Trillium fell 52% after its Ash abstract revealed cases of liver toxicity and thrombocytopenia in the highest dose of 0.3mg/kg in TTI-621’s phase I dose-escalation trial – one enrolee suffered liver enzyme elevations and low platelet counts, while a second suffered only the latter. The company is now exploring a 0.2mg/kg dose.
Achillion, shifting away from its ambitions in hepatitis C, also shared some disappointing news. Outside of the ASH abstracts, it said its phase I trial of ACH-4471 had resulted in liver enzyme elevations in two enrolees, driving shares down 28%.
Updated data for Bluebird Bio’s gene therapy Lentiglobin in severe sickle cell disease found fewer vector copies and lower therapeutic haemoglobin expression, which led to an 11% loss. Keeping to the gene therapy theme, Spark was down heavily after it revealed that its haemophilia B gene therapy SPK-9001 stimulated an immune response in one of seven patients.
Working in the shrinking space of PI3K inhibition means that TG Therapeutics has much to prove, and Ash abstracts are not likely to build confidence. A combination of TGR-1202 with Imbruvica resulted in haematological toxicities, including some grade 3 and 4 cases of neutropenia, along with atrial fibrillation, lipase elevation and adrenal insufficiency.
The fact that many shares bounced back today suggest that it was not just Ash weighing them down. The disappointment is out of the way for the companies that have released bad news, but the meeting will reveal additional surprises, both positive and negative.