Navidea Biopharmaceuticals (NAVB), a leader in precision diagnostics, is a biopharmaceutical company developing novel radiopharmaceutical imaging agents to help identify the presence and status of disease and enable better diagnostic accuracy, clinical decision-making and ultimately patient care. Navidea Biopharmaceuticals's strategy is to deliver superior growth and shareholder return by bringing to market novel radiopharmaceutical agents and advancing the company's pipeline through selective acquisitions, global partnering and commercialization efforts. The company, founded in 1983, maintains headquarters in Dublin, Ohio and recently changed its name from Neoprobe following the sale of its medical device business.
I see at least 5 reasons to buy the stock currently
1. Promising pipeline
Navidea's pipeline includes clinical stage radiopharmaceutical imaging agents used to identify the presence and status of disease to improve diagnostic accuracy, clinical decision-making and patient care.
Lymphoseek (Kit for the Preparation of Technetium Tc 99m Tilmanocept for Injection) is a lymph node targeting agent intended for use in intraoperative lymphatic mapping (ILM). Lymphoseek has the potential to provide oncology surgeons with information to help avoid the unnecessary removal of non-cancerous lymph nodes and the surrounding tissue in patients with breast, melanoma and head and neck squamous cell cancers.
ILM has become the cancer-staging procedure of choice for oncology surgeons as it helps them focus on high-risk nodes and reduce patient exposure to unnecessary surgical complications. Navidea believes there is a need for agents with a faster injection site clearance and less pass through from the sentinel node to distal nodes. Lymphoseek is being developed in an attempt to address these needs.
AZD4694 is a Fluorine-18 labeled precision radiopharmaceutical candidate for use in the imaging and evaluation of patients with signs or symptoms of cognitive impairment such as Alzheimer's Disease (AD). It binds to Beta-amyloid deposits in the brain that can then be imaged in positron emission tomography (PET) scans. Amyloid plaque pathology is a required feature of an Alzheimer's Disease diagnosis and the presence of amyloid pathology is a supportive feature for diagnosis of probable AD. Patients who are negative for amyloid pathology do not have AD.
Based on the data accumulated to date, AZD4694 appears to have very high sensitivity for detecting deposits of amyloid plaque in the brain. Due to its higher affinity for amyloid, markedly improved contrast has been observed displayed by an enhanced uptake in the amyloid-target regions of interest in the brain compared to background. The uptake in background tissue, referred to as white matter, is essentially negligible, providing optimized signal-to-noise ratios. Greater sensitivity and contrast may allow detection of smaller amounts of amyloid and may enable earlier identification of disease pathology.
RIGScan is an investigational, tumor-specific, radio-labeled monoclonal antibody targeting agent. It may be used during surgery to identify cancerous tissue undetectable by traditional diagnostic and intraoperative techniques. The RIGScan agent may enable more effective colorectal cancer surgeries leading to improved patient survival.
Before surgery, a cancer patient is injected with one of the RIGScan targeting agents which circulates throughout the patient's body and binds specifically to cancer cell antigens or receptors. Concentrations of the RIGS within affected tissue are then detected using a gamma probe and direct the surgeon to targeted tissue for removal.
2. PDUFA date for Lymphoseek set for September 10th 2012
On April 3, 2012 Navidea announced that it received notification from the United States Food and Drug Administration (FDA) that the Prescription Drug User Fee Act (PDUFA) date for 99m-Tc-Tilmanocept (Lymphoseek), has been modified to September 10, 2012, a 90-day extension from the initial PDUFA date of June 10th.
As part of its ongoing support of the Lymphoseek NDA review, on March 30, 2012, the company provided as requested by the Agency, updated chemistry, manufacturing and control information related to one of several drug analytical assays. As this information was submitted within the 90-day period prior to the PDUFA date, on April 2nd, FDA at its option elected to extend the review period by 90 days to complete a first-cycle evaluation. Neither this FDA decision nor the NDA review-to-date has raised questions on Lymphoseek's safety or efficacy.
3. Navidea intends to file MAA in the EU for Lymphoseek by year-end 2012
On February 1st 2012 Navidea announced that it intends to file a Marketing Authorization Application (MAA) in the EU for Lymphoseek (Kit for the Preparation of Technetium Tc 99m Tilmanocept for Injection) based on clinical data accumulated from completed pivotal studies and supporting clinical literature.
Navidea has been advised by the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) that the Committee has adopted the advice of the Scientific Advice Working Party (SAWP) regarding the Lymphoseek development program and has determined that Lymphoseek is eligible for an MAA submission.
Accordingly, Navidea has initiated regulatory activities to submit an MAA to the EMA for Lymphoseek by year-end 2012. Preparation of an MAA is typically an extensive undertaking and in the case of Lymphoseek will be similar in scope to Navidea's New Drug Application (NDA) submission with the U.S. FDA. Navidea will seek clearance to market Lymphoseek for use in Intraoperative Lymphatic Mapping (ILM) and will also seek to include the use of Lymphoseek in Lymphoscintigraphy imaging procedures.
"We are pleased to receive the advice and feedback from the SAWP and CHMP as it provides Navidea with confirmation that our Phase 3 studies were well-designed and, with additional supportive information, provide a strong clinical basis for clearance to market Lymphoseek in the EU," commented Rodger Brown, Navidea Vice President of Regulatory Affairs and Quality Assurance. "This milestone provides us with a clear pathway for the MAA submission."
4. JMP Securities has a $8 price target and market outperform rating
JMP Securities wrote:
"New radiodiagnostic product candidate extends reach beyond cancer; reiterate Market Outperform rating and $8 price target on Neoprobe. Navidea announced a licensing deal with AstraZeneca for its Phase III-ready radiopharmaceutical imaging candidate AZD4694 for aiding diagnosis of Alzheimer's disease (AD). We believe this late stage asset acquisition with worldwide exclusive rights could expand the commercial opportunity for Navidea beyond the oncology platform of Lymphoseek and RIGScan while leveraging the company's experience in radiopharmaceutical space. Additionally, this partnership wit "big Pharma" provides validation of Navidea's development capabilities in this space, in our view. Our $8 price target is derived from a sum-of-the-parts DCF analysis including Lymphoseek and RIGScan."
On December 12, 2011 Navidea announced that it has in-licensed the worldwide exclusive rights from AstraZeneca (AZN) to the late-stage radiopharmaceutical imaging candidate, AZD4694, for aiding the diagnosis of Alzheimer's disease.
Clinical studies in more than 70 patients suggest that AZD4694 has the ability to image patients quickly and safely with high sensitivity. Importantly, AZD4694 exhibits low background and white matter uptake, thereby providing clear images of Beta-amyloid deposits. Neoprobe intends to initiate a Phase III clinical program in early 2013, while simultaneously building the requisite safety and training database. Patents and patent applications filed around the world related to AZD4694 are effective until 2028.
"To gain the recognition of AstraZeneca through a rigorous licensing process and secure such a promising late-stage imaging asset is a strong endorsement of our development capability and focus," commented Neoprobe's Executive Vice President and Chief Business Officer, Thomas Tulip, Ph.D. "We believe AZD4694 has a compelling global commercial outlook and should beneficially facilitate development of more effective disease-modifying therapies for Alzheimer´s disease. This potentially powerful second-generation agent with apparent best-in-class properties has demonstrated strong performance attributes. We believe AZD4694 imaging may be quite useful as an adjunct measure in the diagnosis of this large, growing disease and may allow patients to seek earlier, and therefore potentially more effective, treatment options."
5. LifeTech Capital has $5.75 price target
Summary: We believe Navidea shares continue to represent a significant investment opportunity and we are maintaining Navidea with a Strong Speculative Buy rating and a 12-18 month price target of $5.75. Our valuation is based on a 35x multiple on projected fiscal year 2016 EPS and discounted 35% for cumulative risk.
The price target was reiterated on May 14th 2012.
I believe Navidea is a good runup candidate for the September 10th PDUFA date. I believe the stock could trade at $5 if Lymphoseek were to be approved.
Disclosure: I am long NAVB.