Pharmaceutical companies with a set Phase III data release date very often have a run-up leading into the release date. I usually try to buy the stocks 3-9 months before the catalyst date to make profit from the run-up. I screened for companies that have a Phase III data release date set during the next 4-12 months. Here is a look at 5 companies that I found.
1. Oncothyreon (ONTY) is a biotechnology company specializing in the development of innovative therapeutic products for the treatment of cancer. Oncothyreon's goal is to develop and commercialize novel synthetic vaccines and targeted small molecules that have the potential to improve the lives and outcomes of cancer patients.
Upcoming Phase III catalysts
The company's lead product candidate, Stimuvax, is a cancer vaccine being evaluated in two Phase 3 clinical trials for the treatment of non-small cell lung cancer, or NSCLC. The company has granted an exclusive, worldwide license to Merck KGaA of Darmstadt, Germany, for the development, manufacture and commercialization of Stimuvax. Merck KGaA has completed enrollment of 1,514 patients in the Phase 3 START trial of Stimuvax in NSCLC and is currently expected to report the primary efficacy data in early 2013.
The company reported the second-quarter financial results on August 9 with the following highlights:
|Net loss||$8.7 million|
Expenses in 2012 are expected to be higher when compared to 2011, primarily as a result of the more advanced clinical development of PX-866 and the ongoing Phase 1 clinical trial of ONT-10. Oncothyreon currently expects cash used in operations in 2012 to be between approximately $30.0 million and approximately $33.0 million. This guidance excludes $4.1 million cash used to repay the GECC term loan on June 30, 2012. As a result, Oncothyreon estimates that its existing cash, cash equivalents and investments will be sufficient to fund operations for at least the next 12 months.
The stock is currently trading above its 50 day moving average which I am expecting to act like support for the stock. The 200 day moving average is currently at $5.5 which could act like resistance for the stock before the Phase III data release in early 2013.
2. Trius Therapeutics (TSRX) is a biopharmaceutical company focused on the discovery, development and commercialization of innovative antibiotics for life-threatening infections. The company's lead investigational drug, tedizolid phosphate, is a once daily, IV and orally administered second generation oxazolidinone in Phase 3 clinical development for the treatment of ABSSSI. Trius has two Special Protocol Assessments with the FDA for its two Phase 3 ABSSSI trials and has partnered with Bayer HealthCare for the development and commercialization of tedizolid phosphate outside of the U.S., Canada and the European Union. In addition to the company's tedizolid phosphate clinical program, Trius has initiated IND-enabling studies for its Gyrase-B development candidate with potent activity against Gram-negative bacterial pathogens including multi-drug resistant strains of E. coli, Klebsiella, Acinetobacter and Pseudomonas. The Gyrase-B program is one of the two preclinical programs supported by federal contracts.
Upcoming Phase III catalysts
Trius continued enrollment in the second Phase 3 clinical trial of tedizolid phosphate in acute bacterial skin and skin structure infections, or ABSSSI, (the 113 IV to oral transition study) and the study remains on track to report top line data in early 2013.
Acute bacterial skin and skin structure infections (ABSSSI), a new FDA classification for complicated skin and skin structure infections (cSSSI), are a significant and growing problem throughout the world.
ABSSSI are infections that involve deeper tissue or require surgical intervention (e.g. cellulitis, major cutaneous abscesses, and infected wounds) or are associated with a significant underlying disease (e.g., diabetes or systemic immunosuppression) that complicates response to therapy. A variety of pathogens may be identified in ABSSSI but the two most common Gram-positive pathogens are Staphylococcus aureus and Streptococcus pyogenes. The significant increase in the incidence of MRSA in community as well as hospital acquired infections has resulted in a need for therapy of ABSSSI that is effective against MRSA.
The company reported the second-quarter financial results on August 6 with the following highlights:
|Net loss||$14.4 million|
The stock has seen steady insider selling since February 2011. The stock could reach $7-$8 after positive Phase III data in early 2013. If the data is negative the stock would most likely dip below $4.
3. Alkermes (ALKS) is a fully integrated, global biopharmaceutical company that applies its scientific expertise and proprietary technologies to develop innovative medicines that improve patient outcomes. The company has a diversified portfolio of more than 20 commercial drug products and a substantial clinical pipeline of product candidates that address central nervous system [CNS] disorders such as addiction, schizophrenia and depression. Headquartered in Dublin, Ireland, Alkermes plc has an R&D center in Waltham, Massachusetts; a research and manufacturing facility in Athlone, Ireland; and manufacturing facilities in Gainesville, Georgia and Wilmington, Ohio.
Upcoming Phase III catalysts
The company is studying ALKS 9070 for the treatment of schizophrenia. ALKS 9070 is designed to provide once-monthly dosing of a medication that converts in vivo into aripiprazole, a molecule that is commercially available under the name ABILIFY. ALKS 9070 is the company's first product candidate to leverage the company's proprietary LinkeRx product platform. A phase 3 trial to assess the efficacy, safety and tolerability of ALKS 9070 in approximately 690 patients experiencing acute exacerbation of schizophrenia is currently on-going and the clinical data from this study, expected mid-calendar 2013, will form the basis of a New Drug Application (NDA) to the FDA for ALKS 9070 for the treatment of schizophrenia.
The company reported the first-quarter fiscal 2013 (ending June 30) financial results on July 26 with the following highlights:
|Net income||$22.4 million|
The stock has a $29 price target from the Point and Figure chart. The stock has seen steady insider selling since November 2011. I believe the stock could reach $25 after positive Phase III data in 2013. If the data is negative we could dip below $15.
4. GTx, Inc. (GTXI) is a biopharmaceutical company dedicated to the discovery, development, and commercialization of small molecules for the treatment of cancer, cancer supportive care, and other serious medical conditions.
Upcoming Phase III catalysts
Mitchell S. Steiner, MD, CEO of GTx commented on August 8:
We continue to make progress on our late stage clinical programs. We are enrolling our two pivotal Phase III clinical trials evaluating enobosarm for the prevention and treatment of muscle wasting in non-small cell lung cancer patients. We expect to receive topline data from these studies during the second quarter of 2013.
Muscle wasting is a common cancer related symptom which can begin early in the course of a patient's malignancy resulting in decline in physical function and other detrimental clinical consequences. Muscle wasting and muscle weakness are also side effects of many chemotherapy drugs. There are no drugs approved for the prevention and treatment of muscle wasting in patients with cancer.
The company reported the second-quarter financial results on August 8 with the following highlights:
|Net loss||$10.4 million|
The stock has seen some insider selling in April and July 2012, and insider buying in March 2012. I believe the stock could best the $6 level in 2013 after positive Phase III results. If the results are negative the stock would most likely dip below $2 level.
5. Insmed Incorporated (INSM) is a biopharmaceutical company dedicated to the development of innovative inhaled pharmaceuticals for the treatment of serious lung infections, with a particular focus on orphan diseases. Insmed's core expertise is the development of inhaled antibiotic therapy delivered via proprietary advanced liposomal pulmonary technology.
Timothy Whitten, President and CEO of Insmed commented on August 7:
We have successfully transitioned Insmed into a phase 3 development stage company, a significant milestone in our history. During the second quarter, Insmed made substantial progress in advancing ARIKACE in the clinic in our two priority orphan indications. We continue to expect top-line data from CLEAR-108 in mid-2013.
ARIKACE (Inhaled liposomal amikacin) is a potential new weapon in the treatment of serious chronic lung infections. Amikacin is an FDA approved drug with established efficacy. ARIKACE is a liposomal formulation of amikacin, which is an FDA-approved aminoglycoside antibiotic that is administered intravenously and has proven efficacy in the treatment of gram-negative infections. It is a member of the aminoglycoside class of antibiotics. Amikacin has been long recognized as one of the most potent and effective treatments for gram-negative infections including Pseudomonas, as well as non-tuberculosis mycobacterium [NTM]. The value of the systemic use of intravenous (IV) amikacin has been limited by issues of nephrotoxicity (damage to the kidney) and ototoxicity (damage to the ear).
ARIKACE may be desirable because it delivers high, sustained levels of drug to the lung while potentially minimizing systemic exposure well below known toxicity levels, such as nephrotoxicity and ototoxicity.
The company reported the second-quarter financial results on August 7 with the following highlights:
|Net loss||$9.7 million|
The stock has a $11.25 price target from the Point and Figure chart. The stock did see some insider buying in June 2012. I believe the stock could best the $5 level after positive Phase III results in mid-2013. If the data is negative we would most likely dip below $2 level.