Snippet roundup: Medivation talks up as Xbiotech crashes

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Welcome to your weekly roundup of EP Vantage's snippets – short takes on smaller news items.

This week, 4-8 July 2016, we had thoughts on the following: Will Medivation assertions and niraparib news prompt a bigger bid from Sanofi or others?; Mind the gap – Xbiotech crashes on phase III disappointment; Abbott Absorb approval in brief.

Will Medivation assertions and niraparib news prompt a bigger bid from Sanofi or others?

7 July 2106

Analysts at Leerink say Medivation's latest assertions and the niraparib news could triple their value per share for talazoparib – from $6 to $18 – upping the full value of Medivation from $64 to $76 per share. This is caveated as a best-case scenario, and assumes equal value to niraparib, which analyst Geoffrey Porges concedes is generous at this stage.

If any bidder now manages to get to a valuation north of $70 per share, Medivation can consider its two-hour long presentation yesterday as time well spent. However, the $30bn opportunity it reiterated for talazoparib still sounds far-fetched, given the lack of phase III data and, as Sanofi has pointed out, the mere $570m that Medivation committed to get its hands on the asset last year. While the French pharma giant could maybe find reason to up its CVR offer from the $3 currently on the table, a number in double figures seems unlikely.

Mind the gap – Xbiotech crashes on phase III disappointment

6 July 2016

Xbiotech’s 33% share price crash yesterday was a delayed reaction to a weekend presentation of European phase III data for colorectal cancer project Xilonix. The ostensibly positive results, however, exposed gaps in the data, including the use of clinical response endpoints of pain and fatigue, rather than the gold-standard overall survival demanded by the FDA in Xilonix’s US trial. The group’s share price now stands 36% below its April 2015 IPO, but it is still valued at over $600m, despite having virtually no institutional holders.

Abbott Absorb approval in brief

6 July 2016

The FDA approval of Abbott’s bioresorbable scaffold Absorb puts the company comfortably ahead of rival products. But expectations for the device have dimmed over the years and compared with Abbott’s older permanently implanted drug-eluting stent, Xience V, which had peak sales of nearly $1.6bn in 2012, it is a commercial disappointment. Back in September Abbott told EP Vantage that Absorb would be “a revolution” – if so, it is an unusually slow one.

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