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Global Blood Therapeutics Continues To Be An Attractive Run-Up Play

Jul. 06, 2017 9:43 AM ETPfizer Inc. (PFE)11 Comments


  • Shares have roughly doubled year to date, but have decreased around 15% since the secondary offering.
  • Speculation on a takeover in the near to medium term isn't dead, merely depressed. Expect interest to surge again.
  • GBT440 recently received PRIME designation from the EMA.
  • Data from IPF later this year is providing a compelling run-up opportunity, as the market potential in the condition is similar to SCD.
  • Company has a strong cash position, and key institutional healthcare investors are initiating new positions or adding to them.

Shares of Global Blood Therapeutics (GBT) are looking a bit depressed currently, down 15% from their secondary offering. Even so, the share price has essentially doubled since the beginning of the year.

ChartGBT data by YCharts

When I last brought the company to readers' attention, I mentioned that in the second half of the year we should be seeing data from three separate studies in IPF (oxygen independent patients, ZEPHYR, and phase 1 Basecamp), resulting in a potential run-up in share price. I also pointed out that after its secondary offering, the cash runway was extended into 2019, allowing it plenty of time to progress its promising pipeline. Keep in mind that early data involving asset GBT440 in sickle cell disease resulted in clinically meaningful increases in hemoglobin and durable reductions in hemolysis and peripheral blood sickle cells, along with being reasonably well tolerated. Such a drug could do in excess of $2 billion in sales should it make it across the finish line.

What's New

There's been quite a bit of speculation that Novo Nordisk (NVO) could be looking to make key acquisitions, with Global Blood Therapeutics making its short list of candidates. While unconfirmed, the story was that the larger firm was looking to shore up its blood products division but was unable to agree on a fair valuation with the smaller company.

A much more concrete piece of news was that GBT440 was determined to be eligible for the European Medicines Agency Priority Medicines (PRIME) program, which adds further credibility to the story management has been pushing that the drug could really benefit the SCD community. Accelerated development of the drug candidate was welcome news to investors and patients alike.

For the first quarter of 2017, the company reported a cash balance of $310.3 million, while net loss amounted to $23.3

This article was written by

Jonathan Faison profile picture
Community of Biotech Investors Focused on Value & Clinical Momentum

Founder of 500+ member ROTY Biotech Community (try the 2-week free trial to see if it adds value for you). Quality over quantity- enjoy connecting with readers.

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