Dyax’s (DYAX) share price Wednesday morning no doubt reflected the jumping for joy that must have been going on at the company’s headquarters earlier this week when news of FDA approval for Kalbitor (ecallantide or DX-88) arrived.

The company has been struggling to win approval for several years now and once thought the drug could be on the market in 2007. Requests for further trials delayed progress and the company lost a partner in the shape of Genzyme (GENZ) along the way. However, Kalbitor will still be the first small molecule drug approved to treat acute attacks of hereditary angiodema (HAE) in the US, and, as such, the 22% leap in Dyax’s share price, to a 14-month high, certainly looks justified.

It was the kind of news that Merck KGaA (MKGAY.PK) could have done without following its failure last week to get European approval for Erbitux in lung cancer. As such, the bombshell that the FDA had issued a refuse to file letter in response to the marketing application for oral MS drug, Movectro (cladribine), predictably caused shares in the German group to head southward yesterday, aided by a slew of analyst downgrades.

The FDA’s decision appears to point to a problem with the data that Merck has submitted to the US watchdog. At the moment, it is unclear whether the group had not supplied enough data or if the data it had used were not acceptable for whatever reason. What it also means is that Merck has now fallen behind in the race to launch the first oral MS pill, potentially leaving the door wide open for Novartis’ (NVS) FTY720 (fingolimod) to get to market ahead of cladribine (Novartis' FTY720 fights back in race for first oral MS pill, September 30, 2009).

As only the second JAK inhibitor to enter phase III trials, Incyte’s (INCY) INCB18424 has already attracted a fair amount of attention. This attention turned into hard cash Wednesday with a chunky licensing deal struck with Novartis (NVS), which has bought ex-US rights to the compound and another earlier stage product for $210 million upfront, with future milestones potentially worth another $1.1 billion.

Interestingly, this deal has been forged only a couple of weeks ahead of the release of a tranche of phase II data on the drug, due to be presented at the American Society of Hematology (ASH) meeting. Abstracts already released suggest that the studies are going to point to much bigger potential for ‘424 beyond its lead indication myelofibrosis, which is already viewed as a blockbuster opportunity. Still, the less than effusive reaction seen on the stock market to today’s news, with Incyte shares up 7% in early trade, suggests that many have already bought into the optimism around this product.

Even before the FDA’s ominous announcement last week that it had found things that really should not be there in vials of Genzyme’s (GENZ) enzyme replacement products, the US biotech was certainly having a personal annus horribilis.

With calls for heads to roll growing louder from the investment community and commentators alike, the company is heading into 2010 in a bruised and battered state. Manufacturing problems are still not sorted to the regulator’s liking at Genzyme’s now infamous Allston facility and niggling negatives are cropping up elsewhere, and concerns are mounting that things could get a lot worse before they get start getting better.

The final piece of the puzzle fell into place for NeurogesX (NGSX) earlier this week when the FDA granted approval for its pain patch, Qutenza, to treat postherpetic neuralgia (PHN). The company and its investors’ attention will now turn to commercialisation, a process that throws up a whole new set of challenges for the company.

With approval also in place in Europe and its marketing partner for the region, Astellas Pharma (ALPMF.PK), already preparing for launch, all eyes will be on initial sales figures as they start to roll in the next year. The company is still mulling over finding a partner in the US, but comments made on a conference call this week suggest this is unlikely to happen in the near future. News that could materialise soon is a fund raising. Although NeurogesX has enough money in the bank to launch the product in the first quarter of next year, further funds will be required at some point, and with the share price at a two-year high the time looks ripe for a share sale.

Poniard Pharmaceuticals (PARD) on Monday stared into the abyss of disappointment. Shares in the US company lost three quarters of their value on news that its platinum-based chemotherapy agent, picoplatin, failed to improve overall survival in patients with lung cancer in a phase III trial, dashing hopes of an imminent and lucrative licensing deal and strewing the path to market with obstacles.

Clearly this was a pivotal event, However, strategic choices made by the company exacerbated the importance of this study; in particular waiting for the data before partnering and, perhaps more importantly, deciding against raising money to provide a cushion should the worst happen. Now the worst has happened, and Poniard could be out of cash in six months. No wonder investors fled as fast as they could.

Arbiter 6-Halts, a study that pitted Abbott Laboratories’ (ABT) Niaspan against Merck & Co’s (MRK) Zetia, has attracted a lot of attention for such a small trial, the reasons being it has touched on two huge areas of debate in the cardiovascular field.

Firstly, it is down to the presence of Zetia, a component of Merck’s Vytorin which is already the subject of much controversy. Observers from both the medical and financial worlds are keen to scrutinise any incremental evidence to determine whether current concerns about its efficacy are warranted. Secondly, the study speaks to a broader debate about the relative benefits of boosting “good” and lowering “bad” cholesterol levels. Despite important limitations, this trial seems to add support to the former approach, no doubt to the satisfaction of Abbott, which has spent a lot of money in the last few years adding therapies that do just this.

In what has definitely not been its finest week, Hemispherx Biopharma (HEB) has seen its shares fall heavily after being forced to admit that there were still several issues outstanding with its NDA filing for lead drug, Ampligen, that would mean essential paper work for getting approval in chronic fatigue syndrome (CFS) would not be completed until December.

While delays are a normal part of the long and difficult process of getting a drug approved, what the market is punishing Hemispherx for, and rightly so, is the fact that the company had previously made statements that appeared to support the idea that the drug would win a marketing license in May, rather than the truth that its NDA filing was incomplete. What has added insult to injury is that Hemispherx took the opportunity to raise money not once but twice in May, bagging $34.4 million after the shares more than doubled as investors became increasingly excited as the ‘PDUFA decision’ approached (Event - Hemispherx shares liven up ahead of chronic fatigue drug PDUFA date May 19, 2009).

As Merck & Co (MRK) starts a new chapter Wednesday following its $41 billion acquisition, sorry, reverse merger, of Schering-Plough (SGP), the elephant in the room remains the ongoing arbitration with Johnson & Johnson (JNJ) over two of Schering’s most valuable products: the anti-rheumatic antibodies Remicade and Simponi (J&J ups the ante in battle for Remicade and Simponi, May 28, 2009).

The arbitration was never going to stop the Merck-Schering deal from completing, but the fact that a settlement has not yet been reached suggests the legal process will now have to run its course, with a verdict not expected until the first quarter of next year. While the distraction and uncertainty caused by the arbitration is far from ideal for Merck as it sets about integrating the two businesses, the high stakes at risk make the battle inevitable and worth fighting tooth and nail for.

The high hopes that both the market and sufferers from lupus hold for Human Genome Sciences' (HGSI) lead drug, Benlysta, showed no signs of being dashed Monday after the group and partner GlaxoSmithKline (GSK) released the hotly awaited 52-week data from their Bliss-76 trial.

While the data was not as strong as the original Bliss-52 trial, it still leaves Benlysta as the only drug in almost 50 years to show a statistical benefit in this hard to treat disorder in not one but two phase III trials. HGS’s Bliss studies have been the biggest clinical trials ever conducted in lupus and the 819 patient Bliss-76 trial showed that the drug improved symptoms at the highest 10mg/kg dose.

What should have been a dream approval for Transcept Pharmaceuticals (TSPT) has turned into a nightmare for the Californian company, which now faces a significant delay to the launch of its middle of the night waking insomnia drug Intermezzo. Wednesday, the FDA issued the group with a complete response letter, not because of doubts over Intermezzo’s efficacy, but because of concerns over a safe dosing strategy that would avoid users taking the drug with less than four hours of bedtime remaining, or inadvertently taking a double dose in one night.

Transcept now faces the expense and headache of conducting at least one or more additional safety studies, including next day driving tests, to show if there are any residual after-effects. The news, which has caused Transcept's shares to fall 55% since Tuesday, could also cause a few sleepless nights for Somaxon Pharmaceuticals (SOMX), NovaDel Pharma (NVD) and Alexza Pharmaceuticals (ALXA), who are also developing drugs in this niche indication.

With sales of its lead drug losing headway to rival Celgene’s (CELG) Vidaza, striking a deal with GlaxoSmithKline (GSK) to collaborate on cancer drug discovery was just the tonic that SuperGen's (SUPG) shares needed. Monday, the California group announced that it had inked a deal worth up over $375 million to utilize its novel drug discovery technique, Climb, causing a 13% jump in its stock to $2.70.

Under an early stage, and therefore heavily back-end loaded, deal, Glaxo agreed to buy shares worth $3 million and pay $2 million in cash in return for SuperGen pushing a range of cancer compounds through to proof of concept. The total development milestones could eventually reach $375 million, and the group will be entitled to double digit royalties on any products produced by the collaboration.

News that the European advisory committee will adopt a negative opinion next month on Antigenics’ (AGEN) kidney cancer vaccine candidate, Oncophage, not only hurt their shares by 42% Wednesday, but raised questions over where the biotech company can go from here.

Although Oncophage has been approved in Russia, that was 18 months ago and the vaccine has yet to be released onto the market. In addition, the FDA has requested additional clinical trials be conducted before they would consider approving the vaccine. Established in 1994 and having spent $293 million on R&D since the company went public in 2000, and with 17 pipeline candidates already on the scrap heap, Antigenics is clearly experiencing desperate times, which may call for desperate measures.

The termination of a licensing agreement between a big pharma company and small partner is often spun as an opportunity for the latter party, whilst a plummeting share price tells a completely different story.

This could well have been the situation for Progenics (PGNX) Wednesday, which announced that it had “regained the rights” to opioid-induced constipation drug Relistor from Wyeth (WYE), spelling the end to a four-year relationship.

OncoGenex Pharmaceuticals (OGXI) is certainly shaping up to be one of this year’s success stories, on the stock market at least. And, by all accounts, the company’s stratospheric journey is not over yet.

Startling results from a phase II trial of its lead product, OGX-011 for advanced prostate cancer, have prompted the stock to surge from $3 to $37 this year, marking one of the best returns seen across the sector. The company has promised a licensing deal by the end of the year so the drug can move swiftly into pivotal trials, and investors are clearly betting on big bucks, possibly even a take out. With a market value of $220 million, OncoGenex could still have some way to run.

Immunomedics (IMMU) has had an outstanding year. The small New-Jersey based company has produced some of the biggest growth in the microcap sector and has seen its shares more than double since January (Human Genome, OncoGenex Standout Smallcaps So Far in 2009, October 1,).

What Immunomedics appears to have got right is the multiple targets it has for hard-to-treat disorders using its proprietary monoclonal antibody technology. However, the shares, which peaked in August on the back of positive phase IIb lupus data for epratuzumab, have in recent weeks lost a little ground as investors, pleased with the so far spectacular results, have hastened to take profits.

The slew of new data released at a European cancer conference over the last few days on the competing EGFR cancer antibodies, Erbitux and Vectibix, contained a few surprises. However, it seems that analyst forecasts for the two drugs, and predictions about the future landscape for metastatic colon cancer therapy, will largely remain intact.

Strong data from Amgen for Vectibix supports the theory that the antibody could leapfrog its rival in the important US market and beat it to a more favourable front line label, driving sales; this expectation is already reflected in forecasts (see tables below). In Europe the picture is slightly more complicated but it seems Vectibix should be able to take some share, although strong new data for Erbitux means this will not be won without a fight.

It was only a matter of time before speculation about GlaxoSmithKline’s intentions towards Dr. Reddy’s Laboratories reared its head, after a strategic alliance was forged between the two groups three months ago. Rumours are currently abounding that the British pharma giant is set to buy a 5% stake in the Indian generics firm.

The deal between the two groups does feel a lot like the collaboration set up with Aspen Pharmacare in 2008; a year later this was extended and a 16% stake in the South African firm acquired. Given Glaxo’s (GSK) stated aim to expand in emerging markets and the fact that Dr. Reddy’s (RDY) is arguably one of the strongest Indian generics players, it is not unreasonable that this partnership should progress in a similar vein.

XenoPort (XNPT) received a big boost yesterday from positive data on its lead drug, GSK1838262/XP13512 (gabapentin enacarbil), in a neuropathic pain trial, the second attempt by the company and its partner GlaxoSmithKline (GSK) to prove that this product has much larger potential than currently forecast.

The results were from a trial in neuropathic pain associated with post-herpetic neuralgia (PHN); a previous trial in diabetic neuropathic pain failed to establish efficacy (Xenoport's bubble has burst but there is hope on the horizon, May 5, 2009). Whereas the first trip up caused the stock to drop to a two year low of $14, today’s results prompted the stock to surge almost 30% in early trade, to a seven-month high of $25.23. Should Glaxo chose to move into phase III in this indication, XenoPort shares should be able to at least maintain this level.

After getting caught trying to do a sneaky back door agreement with Johnson & Johnson (JNJ) over the US giant financing a possible buyout of Biogen Idec’s (BIIB) stake in MS drug Tysabri, Elan (ELN) was left looking suitably contrite Tuesday after it announced that it had revised the terms of its agreement with J&J.

In July, Elan unveiled a deal with J&J that looked to be the answer to all of its debt problems, as J&J promised to invest $1bn in the group in return for early stage Alzheimer’s products and a stake in Elan. J&J also agreed to contribute to the development of its experimental Alzheimer’s drug bapineuzumab (J&J comes riding to Elan’s rescue, July 2, 2009).