Your Daily Pharma Scoop: Regeneron's Appeal, Good News For Amgen, Bristol-Myers' Sprycel

Summary

Regeneron looks attractive at current levels.

Amgen sees positive opinion on two of its drugs from EMA’s CHMP.

Bristol-Myers’ Sprycel gets FDA’s nod in Ph+ CML.

This abridged “Daily Scoop” is published by Avisol Capital Partners, which runs the physician-managed Total Pharma Tracker healthcare investment research service on Seeking Alpha Marketplace.

Analysis of top Seeking Alpha coverage: Regeneron

Today we will discuss an article on Regeneron (REGN) by DoctoRx, titled “Regeneron Falls On Q3 Report: Weighing The Pros And Cons.

Regeneron has had a decent run this year, gaining more than 10%. More recently though the stock has seen a sharp pullback. REGN had climbed to above $500 in July this year. But then a spate of bad news pushed the stock lower. DoctoRx begins the article by talking about the negative news flow over the summer that pushed REGN lower. The author notes that he was expecting REGN to hold at around $450, but the stock fell through this level.

DoctoRx notes that he did not buy on previous dip but with the stock now hovering around $400, it looks “more of a value play.” In fact, this is something we had noted when we covered REGN last month. DoctoRx notes that based on the present value of its marketed products, REGN has a market capitalization of $50 billion. The company’s current market capitalization is around $44 billion so it is trading roughly at a 10% discount to its intrinsic value, taking into account just the marketed products.

In our article last month, we had also noted the potential of Regeneron’s marketed products. Of course, Eylea remains the most important product in REGN’s portfolio. In Q3, the company registered a 12% increase in U.S. net sales of Eylea. But we had noted the potential of dupilumab in both indications; eczema and asthma. Our article also focused on Regeneron’s focus on developing new partnerships, including the one with Teva Pharmaceutical (TEVA).

While Eylea remains a key growth driver in the near-term, the uptake of dupilumab and the potential of Regeneron’s pipeline will be the key drivers of valuation in the long term. The company currently has 15 candidates in its pipeline. Five of these pipeline candidates are in Phase 3.

DoctoRx also briefly discusses REGN’s pipeline. Overall though the author is cautiously optimistic about the company’s future. Having said that, he does note that he has initiated a small position at current levels. We believe that this is a good entry level for REGN as there could be at least 10%-15% near-term upside. As we had noted in our article last month that based on forward earnings guidance of $18 per share, REGN looks reasonably valued. This was when the stock had been around 20% above current levels. Based on the fundamentals then, we believe that this is a good entry level for REGN unless the sentiment on biotech sector as a whole remains negative heading into the year end. With no major news flow, we believe that sentiment on the biotech sector has a whole will remain neutral and do not see any further downside in big biotech names, including Regeneron.

Stocks in the news: Analysis of PETX, AMGN, AGN, AZN, BMY

European advisory group backs Amgen's Avastin biosimilar ABP 215

Company: Amgen (NASDAQ:AMGN) and Allergan (NYSE:AGN)

Co Name

Amgen, Inc.

Ticker

AMGN

Focus area

Oncology

Today's Price

$172.35

52-week high

$191.10

52-week low

$138.83

%diff--52w-low

24.14

Mkt cap

125B

Volume

2,800,010.00

Cash Balance

3B

Therapy: ABP 215, a biosimilar to Roche's (OTCQX:RHHBY) Avastin (bevacizumab).

News: The European Medicines Agency's Committee for Medicinal Products for Human Use (CHMP) adopts a positive opinion recommending approval for Amgen's ABP 215, a biosimilar to Roche's Avastin (bevacizumab).

The product is being co-developed and co-commercialized with Allergan.

Analysis: Avastin had sales of $6.96 billion in 2016. In 2020, the is forecasted to register sales of $6.36 billion. This, however, does not take into account competition from biosimilars, which could take a significant portion of Avastin market share if approved.

European advisory group backs expanded use of Amgen's Nplate

Company Amgen

Co Name

Amgen, Inc.

Ticker

AMGN

Focus area

Oncology

Today's Price

$172.35

52-week high

$191.10

52-week low

$138.83

%diff -52w-low

24.14

Mkt cap

125B

Volume

2,800,010.00

Cash Balance

3B

Therapy: Nplate (romiplostim)

Disease: chronic immune (idiopathic) thrombocytopenic purpura (ITP)

News: The European Medicines Agency's Committee for Medicinal Products for Human Use (CHMP) adopts a positive opinion recommending approval for Amgen's Nplate (romiplostim) for the treatment of chronic immune (idiopathic) thrombocytopenic purpura (ITP) in patients as young as one year old who do not respond to other treatments (e.g., corticosteroids, immunoglobulins).

Previously Nplate was approved in the EU for adults with ITP.

A final decision from the European Commission usually takes ~60 days

Analysis: The positive recommendation from the CHMP was based on data from five studies that assessed the safety and efficacy of Nplate in children with ITP. ITP is a rare disease, with incidence of 4-5 per 100,000 per year in Europe.

European advisory group backs AstraZeneca's benralizumab for adults with eosinophilic asthma

Company: AstraZeneca (NYSE:AZN)

Co Name

AstraZeneca plc (ADR)

Ticker

AZN

Focus area

Oncology

Today's Price

$32.91

52-week high

$35.60

52-week low

$25.55

%diff--52w-low

28.81

Mkt cap

80B

Volume

3,665,628.00

Cash Balance

5.2B

Therapy: benralizumab

Disease: eosinophilic asthma

News: The European Medicines Agency's Committee for Medicinal Products for Human Use adopts a positive opinion recommending approval for AstraZeneca's benralizumab as add-on maintenance treatment in adult patients with severe eosinophilic asthma inadequately controlled despite high-dose inhaled corticosteroids plus long-acting beta agonists.

A final decision from the European Commission usually takes ~60 days.

Analysis: Benralizumab is an anti-interleukin-5 receptor alpha monoclonal antibody that depletes blood and sputum eosinophils, a type of white blood cell. Eosinophils are associated with the cause and severity of COPD attacks, as well as asthma. The positive opinion from the CHMP is based on results from the WINDWARD program, which includes the pivotal SIRROCO and CALIMA trials. A reduction of up to 51% in annual asthma exacerbations rate was observed in these trials.

FDA OKs expanded use for Bristol-Myers' Sprycel

Company: Bristol-Myers Squibb (NYSE:BMY)

Co Name

Bristol-Myers Squibb Co

Ticker

BMY

Focus area

Oncology & HIV

Today's Price

$60.86

52-week high

$66.10

52-week low

$46.01

%diff--52w-low

32.28

Mkt cap

99B

Volume

5,698,158.00

Cash Balance

4.6B

Therapy: Sprycel (dasatinib)

Disease: Philadelphia chromosome-positive (Ph+) chronic myeloid leukemia (CML) in chronic phase.

News: Under Priority Review status, the FDA approves Bristol-Myers Squibb's Sprycel (dasatinib) tablets for the treatment of pediatric patients with Philadelphia chromosome-positive (Ph+) chronic myeloid leukemia in chronic phase.

Previously it was approved for adults with Ph+ CML and adults with Ph+ acute lymphoblastic leukemia (ALL).

Analysis: The label expansion should help Bristol-Myers Squibb in reaching its targeted 2018 sales for Sprycel. In fact, the drug has been seen as a key revenue driver for BMS in the near-term.

In other news

The European Medicines Agency's Committee for Medicinal Products for Veterinary Use (CVMP) adopts a positive opinion recommending approval for Aratana Therapeutics' (PETX) GALLIPRANT (grapiprant tablets) for the treatment of pain associated with mild-to-moderate osteoarthritis in dogs. A final decision from the European Commission usually takes ~60 days.

Analyst Ratings

Axovant Sciences Ltd (AXON): Piper Jaffray Companies reiterates hold. See our articles on AXON here.

Endo International PLC (ENDP): BMO Capital Markets, Cantor Fitzgerald, Citigroup and Royal Bank Of Canada lower target to $10.00, $7.00, $7.00 and $8.00 respectively; Mizuho and Piper Jaffray Companies reiterate buy and hold respectively. See also Avisol's coverage.

Esperion Therapeutics (ESPR): Northland Securities reiterates buy with target of $72.00. ESPR is in our watch list with entry price of $40.00 and price target of $52.00. ESPR last closed at $48.53 and consensus price target is $60.85.

Heron Therapeutics (HRTX): Oppenheimer Holdings reiterates buy with target of $27.00. HRTX is in our watch list with entry price of $14.00 and target of $20.00. Last close price of the stock was $16.35 and consensus target is $31.55. See our HRTX coverage here.

Jazz Pharmaceuticals PLC (JAZZ): HC Wainwright reiterates neutral rating and raises target from $144.00 to $150.00. See also Avisol's coverage of JAZZ.

Pfizer (PFE): BMO Capital Markets reiterates buy with target of $39.00. The stock is in our watch list waiting for pullback. See also our articles on PFE.

TESARO (TSRO): Robert W. Baird reiterates hold with target of $120.00 and SunTrust Banks reiterates buy with target of $160.00. See also our coverage of TSRO.

Valeant Pharmaceuticals International (VRX): Piper Jaffray Companies reiterates sell with target of $12.00. See Avisol's coverage.

More analyst ratings in appendix.

Earnings

National Healthcare Corporation (NHC) reported its third quarter net income at $11.35 million, up from $11.11 million for the quarter ended September 30, 2016, an increase of 2.2%. Its net operating revenues for the three months ended September 30, 2017 totaled $241.98 million compared to $231.28 million for the same three months of 2016, an increase of 4.6%.

Pro-Dex (PDEX) announced its net sales for the three months ended September 30, 2017 totaled $5.2 million, an increase of $33,000, or 1%, from $5.1 million for the three months ended September 30, 2016. Its net income was $628,000, or $.15 per share, compared to $286,000 for the quarter ended September 30, 2016, or $0.07 per share.

Reliv’ International Inc. (RELV) announced net sales of $9.1 million for the third quarter of 2017 compared with net sales of $10.8 million in the third quarter of 2016. The company reported a net loss for the third quarter of 2017 at $319,000 and loss per diluted share at $0.17 compared to net income at $134,000 and income per diluted share at $0.07 in the third quarter of the previous year.

Sangamo Therapeutics (NASDAQ:SGMO) reported a consolidated net loss of $12.4 million, or $0.15 per share, compared to a net loss of $19.0 million, or $0.27 per share, for the same period in 2016. Its revenue for the third quarter of 2017 were $11.8 million, compared to $2.8 million for the same period in 2016. The Company had cash, cash equivalents, marketable securities and interest receivable of $253.5 million as of September 30, 2017.

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Appendix/Tables:

Analyst Ratings

Company

Ticker

Analyst

Action

Rating

Target

Adaptimmune Therapeutics PLC

ADAP

SunTrust Banks

Reiterates

Buy

$10.00

Amphastar Pharmaceuticals

AMPH

BMO Capital Markets

Raises Target

Market Perform

$16.00 -> $17.00

AveXis

AVXS

Bank of America Corporation

Lowers Target

Buy

$115.00 -> $112.00

AveXis

AVXS

Royal Bank Of Canada

Raises Target

Sector Perform -> Sector Perform

$92.00 -> $97.00

BioLife Solutions

BLFS

Maxim Group

Raises Target

Buy -> Buy

$7.00 -> $8.00

Blueprint Medicines Corporation

BPMC

Cowen and Company

Reiterates

Buy

Caladrius Biosciences

CLBS

HC Wainwright

Reiterates

Buy

$7.00

Concert Pharmaceuticals

CNCE

HC Wainwright

Reiterates

Buy

$21.00

Catalyst Pharmaceuticals

CPRX

HC Wainwright

Reiterates

Buy

$6.00

CRISPR THERAPTC

CRSP

SunTrust Banks

Reiterates

Hold

$16.00

Depomed

DEPO

Piper Jaffray Companies

Reiterates

Hold

$5.00

Fate Therapeutics

FATE

HC Wainwright

Reiterates

Buy

$7.00

Flexion Therapeutics

FLXN

Northland Securities

Reiterates

Buy

$40.00

Galmed Pharmaceuticals

GLMD

HC Wainwright

Reiterates

Buy

$18.00

Globus Medical

GMED

Bank of America Corporation

Upgrades

Underperform -> Neutral

Impax Laboratories

IPXL

Cantor Fitzgerald

Raises Target

Overweight

$25.00 -> $35.00

Impax Laboratories

IPXL

Cowen and Company

Reiterates

Hold

$16.00

Invacare Corporation

IVC

KeyCorp

Reiterates

Buy

$18.00

Jounce Therapeutics

JNCE

Robert W. Baird

Reiterates

Buy

$30.00

K2M Group Holdings

KTWO

Oppenheimer Holdings

Reiterates

Buy

$24.00

MacroGenics

MGNX

Citigroup

Raises Target

Neutral

$18.00 -> $22.00

Myovant Sciences Ltd

MYOV

Robert W. Baird

Reiterates

Buy

$20.00

NuVasive

NUVA

Royal Bank Of Canada

Lowers Target

Outperform -> Outperform

$75.00 -> $70.00

Novelion Therapeutics

NVLN

Royal Bank Of Canada

Lowers Target

Sector Perform

$9.00 -> $8.00

Otonomy

OTIC

Piper Jaffray Companies

Reiterates

Hold

$8.00

Puma Biotechnology

PBYI

Barclays PLC

Reiterates

Buy

$103.00 -> $122.00

Puma Biotechnology

PBYI

Citigroup

Raises Target

Buy -> Buy

$156.00 -> $164.00

Puma Biotechnology

PBYI

Credit Suisse Group

Raises Target

Outperform

$136.00 -> $142.00

Puma Biotechnology

PBYI

Royal Bank Of Canada

Lowers Target

Sector Perform

$108.00 -> $92.00

Pieris Pharmaceuticals

PIRS

HC Wainwright

Reiterates

Buy

$9.00

Proteon Therapeutics

PRTO

Robert W. Baird

Reiterates

Hold

$2.00

RA PHARMCTL INC

RARX

Credit Suisse Group

Raises Target

Outperform

$19.00 -> $23.00

Sage Therapeutics

SAGE

Chardan Capital

Upgrades

Neutral -> Buy

$60.00 -> $140.00

Sage Therapeutics

SAGE

Needham & Company LLC

Raises Target

Buy -> Buy

$86.00 -> $100.00

Scotts Miracle-Gro Company

SMG

SunTrust Banks

Reiterates

Hold

$95.00

Sonoma Pharmaceuticals

SNOA

Maxim Group

Raises Target

Buy

$10.00 -> $11.00

Sophiris Bio

SPHS

HC Wainwright

Reiterates

Buy

$6.00

Stemline Therapeutics

STML

HC Wainwright

Reiterates

Buy

$38.00

Viking Therapeutics

VKTX

HC Wainwright

Reiterates

Buy -> Buy

$7.00

VAREX IMAGING

VREX

Jefferies Group LLC

Raises Target

Buy

$39.00

Intrexon Corporation

XON

Bank of America Corporation

Lowers Target

Neutral

$25.00 -> $21.00

Intrexon Corporation

XON

Northland Securities

Reiterates

Buy

$21.00

Intrexon Corporation

XON

Stifel Nicolaus

Raises Target

Buy

$39.00 -> $57.00

Zoetis

ZTS

Jefferies Group LLC

Reiterates

Buy


Secondary Offerings

Company Name

Ticker

Price

Stock Offered

Assembly Biosciences Inc.

ASMB

$27.25/Share

$60 Million

Eleven Biotherapeutics Inc.

EBIO

$0.80/Share

$4.4 Million

Nanovibronix Inc.

NAOV

$4.90/Share

$6 Million


Earnings Calendar

Company Name

Ticker

Date of Earnings Announcement

ImmuCell Corporation

ICCC

November 13

Orexigen Therapeutics Inc.

OREX

November 13

Marrone Bio Innovation

MBII

November 13

Celsion Corporation

CLSN

November 14

Ampliphi Biosciences

APHB

November 14

Foamix Pharmaceuticals Ltd

FOMX

November 15

Ascendis Pharma

ASND

November 16


Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.

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