Multiple Observations On Celgene's Latest Licensing Deals, And Its Valuation
DoctoRx • 75 Comments
DoctoRx • 75 Comments
Celgene: A Pre-Earnings Discussion Based On Recent News
DoctoRx • 39 Comments
DoctoRx • 39 Comments
Apr. 29, 2015, 5:30 PM
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Apr. 29, 2015, 3:34 PM
- Before the open (consensus views):
- Sanofi (SNY -1%), Revenues of $39B.
- Celgene (CELG -0.1%), EPS of $1.06 on revenues of $2.1B.
- AmerisourceBergen (ABC -1.2%), EPS of $1.19 on revenues of $32.3B.
- Teva Pharmaceutical Ind. (TEVA +1.1%), EPS of $1.25 on revenues of $4.8B.
- Shire plc (SHPG -0.6%), EPS of $2.59 on revenues of $1.5B.
- After the close:
- Gilead Sciences (GILD -1.3%), EPS of $2.32 on revenues of $6.9B.
- Biomarin Pharmaceuticals (BMRN -0.2%), loss per share of ($0.53) on revenues of $203M.
Apr. 27, 2015, 8:17 AM
- Celgene (NASDAQ:CELG) acquires privately-held San Francisco, CA-based Quanticel Pharmaceuticals for $100M in cash and up to $385M in various R&D and regulatory milestones. Celgene expects the transaction to be neutral to 2015 non-GAAP EPS guidance.
- Quanticel, which as been a strategic alliance partner to Celgene since 2011, is a cancer-focused drug discovery firm based on a proprietary single-cell genomic analysis platform.
Apr. 24, 2015, 10:27 AM
Apr. 24, 2015, 8:15 AM
- Celgene (NASDAQ:CELG) subsidiary Celgene International II Sarl and AstraZeneca (NYSE:AZN) subsidiary MedImmune enter into a strategic collaboration to develop and commercialize MEDI4736, MedImmune's human monoclonal antibody against programmed cell death ligand 1 (PD-L1), for hematologic malignancies. PD-L1 is a protein found on the surface of cancer cells that enable them to avoid detection by the immune system. Binding to PD-L1 enables T cells to recognize and kill cancer cells.
- The partnership will explore the potential for combination therapies of MED4736 and Celgene's pipeline product candidates in blood cancers.
- Under the terms of the agreement, Celgene will make an upfront payment of $450M. It will lead clinical development for all clinical trials and pay all costs associated with the trials through 2016. Afterward, it will be responsible for 75% of the costs. Celgene has global commercialization rights to MEDI4736 for hematology indications and will receive royalty rates starting at 70% of worldwide sales in hematology, gradually decreasing to 50% over time.
- Yesterday, MedImmune announced a collaboration with Juno Therapeutics to develop MEDI4736 with a CAR-T therapy for non-Hodgkin lymphoma.
- Previously: Juno and AstraZeneca team up in combo treatment for blood cancer (April 23)
Apr. 16, 2015, 12:19 PM
- A Phase 2 clinical trial, published today in the New England Journal of Medicine, showed that Celgene's (CELG -1.4%) Otezla (apremilast) was effective in reducing the mean number of oral ulcers in patients with Behcet's disease, a rare, chronic inflammatory disorder characterized by recurrent oral and genital ulcers. Joint inflammation and recurrent skin and eye lesions may also occur.
- In patients treated with apremilast for 24 weeks, the decrease in the mean number of oral ulcers was evident by Week 2 (0.3 vs. 2.7 at baseline) and sustained through Week 24 (0.6). In the placebo arm, the numbers were 1.7 at Week 2 vs. 2.9 at baseline. After 12 weeks, these patients were crossed over to apremilast for 12 weeks. The mean number of oral ulcers in this cohort at Week 24 was 0.4.
- Behcet's disease is believed to be caused by abnormalities in the immune system and inflammation in the blood vessels. It is most prevalent in the Middle East, Asia and Japan. It is most common in Turkey, affecting one in 250 people. It is classified as an orphan disease in the U.S. The company has begun a Phase 3 for this indication.
- Otelzla is currently approved for the treatment of moderate-to-severe plaque psoriasis and active psoriatic arthritis. It generated $70M in sales in 2014.
Apr. 14, 2015, 7:15 PM
- Goldman Sachs offers three criteria on how to pick stocks to short: Look for individual stocks with high valuations that have a tendency to underperform; take hints from mutual funds as they do a good job of selecting shorts; and look for stocks that are likely to move on company-specific factors and are less prone to moving with general market and sector trends.
- Among the overvalued stocks Goldman thinks could drop are CELG, ORLY and RHT; stocks underweight by mutual funds that could fall are HST, CTL and EQR; and likely to deviate from the broad market and their sectors are KLAC, JEC and COH.
- Rounding out Goldman's 19 stock recommendations that could reward short sellers: ARG, DO, DISCA, FLS, KSS, MOS, NDAQ, NVDA, TDC, WU.
Mar. 31, 2015, 12:37 PM
- Former Nomura analyst Amit Roy says the market for cancer immunotherapies called PD-1 inhibitors will only be ~$10B, far below the $20B - 30B forecasts being circulated today. He cites two main factors that could hamper growth: they only work for certain groups of cancer patients plus several layers of selection will be required for some cancers such as breast and colorectal, and there is a growing evidence that shorter therapy, cutting the treatment period to eight from 16 weeks, may be sufficient. If this comes to fruition, it would shrink the market by almost half (although a price increase could mitigate some of the shrinkage).
- PD-1 (programmed cell death protein 1) is found on the surface of cancer cells. It is used by tumors to evade the immune system so blocking its action enables the body to attack and kill cancer.
- Current FDA-approved PD-1 inhibitors are Bristol-Myers Squibb's (BMY -1.2%) Opdivo (nivolumab) and Merck's (MRK -0.7%) Keytruda (pembrolizumab).
- PD-1-related tickers: (MDVN -2.4%)(FPRX -1.2%)(CELG -3.1%)(OTCQX:RHHBY +0.6%)(AZN -1.7%)(SRNE +3.4%)
Mar. 26, 2015, 1:04 PM
- Celgene (CELG +0.8%) and Martinsried, Germany-based MorphoSys AG mutually agree to terminate their co-development and co-promotion agreement for MOR202, a fully human monoclonal antibody being investigated, in combination with Velcade (bortezomib) and Revlimid (lenalidomide), for the treatment of blood cancers. MorphoSys will continue the development of MOR202 on its own, including sponsoring a planned Phase 1/2a study in relapsed/refractory myeloma that will include combination cohorts with lenalidomide and pomalidomide (Pomalyst/Imnovid) provided by Celgene.
- MorphoSys plans to release first clinical data from the trial at a medical conference this year. The Revlimid and Pomalyst cohorts will be added by mid-year.
- Financial details are not disclosed, although MorphoSys has increased its 2015 revenue guidance to €101M - 106M from €58M - 63M to reflect the realization of deferred revenues from the original Celgene agreement and a one-time payment from Celgene for development costs.
Mar. 23, 2015, 3:24 PM
- The Barron's 400 has regularly beaten the S&P 500 (NYSEARCA:SPY) since its 2007 launch, writes Chris Dieterich, and also powers the Barron's 400 ETF (NYSEARCA:BFOR), which has topped the S&P 500 by nearly 500 basis points since starting in June 2013. BFOR is up 6% YTD, more than double that of the S&P 500.
- Among those added to the index during last week's twice-yearly rebalancing were Celgene (NASDAQ:CELG), American Airlines (NASDAQ:AAL), Starbucks (NASDAQ:SBUX), and Ameriprise Financial (NYSE:AMP).
- Among those dropped were McDonald's (NYSE:MCD), Wells Fargo (NYSE:WFC), Verizon (NYSE:VZ), and IBM.
- A "ruthless" quantitative security-selection method screens for growth, value, and cash flow, and filters further with other factors such as diversification.
Mar. 19, 2015, 8:27 AM
- In a study published in the New England Journal of Medicine, a Phase 2 study evaluating Celgene's (NASDAQ:CELG) investigational oral antisense therapy, GED-0301, in patients with Crohn's disease demonstrated statistically significant efficacy compared to placebo at certain doses.
- The 166-subject trial enrolled patients with moderate-to-severe Crohn's disease, defined as Crohn's Disease Activity Index ((CDAI)) scores of 220 to 400 (scores <150 indicate remission, >450 severe disease). Patients were randomly assigned to receive treatment for two weeks with one of three daily doses of GED-0301 (10 mg, 40 mg, 160 mg tablets) or placebo and then evaluated for responses at Days 15, 28 and 84. The primary efficacy endpoint was the percentage of patients achieving clinical remission (CDAI score <150) at Day 15, maintained at Day 28.
- 65% of patients receiving GED-0301 160 mg and 55% of those receiving 40 mg met the primary endpoint compared to 12% for the 10 mg cohort and 10% for placebo (p < 0.001).
- The proportion of patients in the 160 mg cohort achieving clinical remission (CDAI score < 150) on Day 15, Day 28 and Day 84 was 67%, 72% and 67%, respectively, versus 21%, 14% and 21%, respectively, for placebo (p < 0.0001). The proportions for the 40 mg and 10 mg cohorts were 58%, 70% and 63% and 15%, 29% and 29%, respectively. The results for the 10 mg group did not reach statistical significance compared to placebo.
- On Day 28, 37%, 58% and 72% of patients treated with 10 mg, 40 mg or 160 mg once daily achieved a clinical response (a 100-point reduction in CDAI score, a secondary endpoint) compared to 17% for placebo (p = 0.04, p < 0.001, p < 0.001, respectively).
- Celgene intends to advance GED-0301, which it licensed from Dublin, Ireland-based Nogra Pharma about a year ago, to Phase 3 development.
Mar. 2, 2015, 10:47 AM
- The European Commission approves the use of Celgene's (CELG -0.5%) Abraxane (nab-paclitaxel) for the first-line treatment, in combination with carboplatin, of non-small cell lung cancer in adult patients who are not candidates for potentially curative surgery and/or radiation therapy. This adds to the product's currently-cleared indications in Europe for metastatic pancreatic and breast cancers.
- Abraxane is a nanotechnology agent contains albumin-bound paclitaxel nanoparticles. It is the company's second best seller after Revlimid. Sales were $624.5M last year.
- Previously: European Ad Comm supports expanded label for Abraxane (Jan. 23)
Feb. 20, 2015, 7:02 AM
- The European Commission approves the use of Celgene's (NASDAQ:CELG) Revlimid (lenalidomide) for the treatment of adult patients with previously untreated multiple myeloma who are not eligible for transplant. This adds to Revlimid's current marketing authorization for the treatment, in combination with dexamethasone, of multiple myeloma in adult patients who have received at least one prior therapy.
- Multiple myeloma strikes ~39K Europeans each year. The mortality rate within the first year of diagnosis is over 60%.
- In a 1,623-patient Phase 3 trial, patients treated with Revlimid plus dexamethasone showed a median overall survival of 58.9 months compared to 48.5 months for those receiving melphalan-prednisone-thalidomide therapy.
Feb. 19, 2015, 10:10 AM
- Facing ever-increasing pushback from payers over the high price of new treatments, some biotech firms are working on a new payment model that rewards them for the long-term performance of their drugs. Gene therapy developers, including BioMarin Pharmaceuticals (BMRN +0.4%) and Sangamo BioSciences (SGMO -0.1%), are leading the effort.
- The industry says that a one-time cure, even if priced greater than $1M, saves money over the long term but acknowledges that payers will balk at paying the cost upfront. The general consensus is that an upfront payment over $1M will be unacceptable.
- Under a pay-for-performance scheme, the annuity-like payments would cease if medical testing showed that the therapy was not working. Much work remains to be done, though, before this approach could be implemented. For example, legislation may be required to force insurers to pick up the tab for patients that switch coverage.
- Some proponents of the new scheme say that the payment streams could be securitized and sold to investors, like consumer debt.
- Gene therapies represent the highest priced treatments. Only one has cleared the regulatory hurdle to date, UniQure's (QURE +1.5%) Glybera, which costs 850K euros ($1M) in Germany. It will be sold for a one-time payment because it is too difficult to measure how well it works (this reasoning will undoubtedly pop up again).
- Previously: UniQure sets price record with Glybera (Nov. 26, 2014)
- Related tickers: (CELG +1.3%)(AMGN -0.2%)(BIIB +0.5%)(GILD +0.1%)(MRK -0.3%)(GSK -0.2%)(AZN +0.9%)(LLY +0.3%)(NVS +0.1%)(PFE -0.5%)(JNJ -0.3%)(OTCQX:RHHBY +1.4%)(BMY -0.4%)(ABT)(BAX -1.1%)
Feb. 18, 2015, 10:54 AM
- The FDA approves a label expansion for Celgene's (CELG +1.3%) Revlimid (lenalidomide) to now include the treatment, in combination with dexamethasone, of patients with newly diagnosed multiple myeloma (NDMM).
- Revlimid's other indications are for the treatment of previously treated multiple myeloma, relapsed/refractory mantle cell lymphoma and transfusion-dependent anemia due to low-or intermediate-1-risk myelodysplastic syndromes.
- Revlimid is the company's top selling product, generating $1.3B in sales in Q4.
Jan. 29, 2015, 7:57 AM
- Celgene (NASDAQ:CELG) Q4 results ($M): Total Revenues: 2,085.5 (+18.8%); Net Product Sales: 2,054.9 (+19.1%); U.S.: 1,232,5 (+21.2%); Intl: 822.4 (+16.2%).
- Key Product Sales: Revlimid: 1,322.5 (+16.4%); Abraxane: 235.9 (+16.9%); Pomalyst/Imnovid: 202.1 (+66.7%); Vidaza: 153.7 (-8.2%).
- COGS: 103.2 (+11.2%); R&D Expense: 584.9 (-20.0%); SG&A Expense: 544.4 (+21.3%); Net Income: 613.9 (+186.3%); EPS: 0.74 (+196.0%); CF Ops: 832.0 (+51.0%); Quick Assets: 7,546.7 (+32.7%).
- Gross Profit: 1,982.3 (+19.2%); COGS: 4.9% (-6.4%); Gross Margin: 95.1% (+0.4%); Operating Earnings: 853.0 (+76.5%); Operating Earnings Yield: 40.9% (+48.6%); Net Earnings Yield: 29.4% (+141.1%).
- 2015 Guidance: Net Product Sales: $9.0B - 9.5B; Revlimid: $5.6B - 5.7B; Abraxane: $1.00B - 1.25B; Non-GAAP Operating Margin: ~52%; Non-GAAP EPS: $4.60 - 4.75; GAAP EPS: $3.68 - 3.92.
Celgene Corp. is an integrated global biopharmaceutical company engaged primarily in the discovery, development and commercialization of therapies for the treatment of cancer and inflammatory diseases through gene and protein regulation. Its targeting areas include intracellular signaling... More
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