Analysis Focus: ADRO
Aduro Biotech Inc. (ADRO) is a smallcap with a market capitalization of $533.397M. The company develops immunotherapy drugs, focuses on development of therapies that treat challenging diseases. The Berkeley, CA based company was founded as Oncologic, Inc. in 2000 and renamed to Aduro BioTech, Inc. in June 2008.
Janssen Biotech (NYSE:JNJ), a licensee of Aduro Biotech (NASDAQ:ADRO) recently announced commencement of Phase 1b clinical trial of ADU-214, combined with Bristol-Myers Squibb's (NYSE:BMY) Opdivo (nivolumab) on patients with advanced/metastatic non-small cell lung cancer (‘NSCLC). Apart from Janssen Biotech, the company has existing collaboration agreements with Novartis Pharmaceuticals Corporation and Merck. In particular, the ADU-214 candidate will target mesothelin-positive relapsed/refractory Stage IIIB or Stage IV adenocarcinoma of the lung. Because Mesothelin expresses on the surface of almost 83% lung adenocarcinoma cells, the mesothelin-positive condition is the most prevalent type of metastatic NSCLC. Mucous-secreting glands throughout the body can be affected by the Adenocarcinoma type of cancer. This type of cancer may occur in different places in the body. However, it is more usual in cancers of the lung, prostate, pancreas and esophagus. Worldwide, lung cancer accounts for 13% of all diagnosed cancers. Apart from non-melanoma skin cancer, lung cancer is the most widely occuring malignancy. Recent data estimates currently 415,000 living Americans have been diagnosed with lung cancer at some point in their lives. It is further estimated that 224,390 new cases of lung cancer were expected to be diagnosed in 2016 alone. Because in recent past 83% of those living with lung cancer were 60+ years of age, it is apprehended that with an aging population the incidence rate will only increase in future.
The primary endpoint of the Phase 1b clinical trial of ADU-214 included 170 subjects. It measured objective response rate (ORR) as primary endpoint at every eight-week interval during 1st year and at every 12 weeks in 2nd year. Primary completion date is October 2020. Stock prices moved +1% at the news. Apart from the present candidate, the company has a has a strong pipeline of three major Program groups: STING Pathway Activator Programs (ADU-S100 being the lead candidate), B-Select Program (BION-1301 is the lead candidate) and personalized neoantigen-based immunotherapy (‘pLADD) Programs. All three have multiple candidates in various stages of clinical trial. The company periodically presents results of various stages of trial data and progress update in major meetings of specialist associations. For example, in recent past data read out and posters were presented at American Association for Cancer Research (‘AACR) and European Neoantigen Summit.
Due to the recent news regarding Phase 1b clinical trial, the stock had a marginal upward movement in the last few days. The stock opened at $8.25 on Monday and since then moved in a series of ups and downs. It closed at $6.50 on Thursday and has since then recovered a little to hover around $6.775. Present price change is around the median of the 52Wk range of $5.825 - $14.050. The stock is estimated to show quite volatility with a 2.05 Beta. Due to its narrower than expected loss and rising revenue data in Q1 result the stock had a month long rally to gain 18.6% and reached its recent peak price of $8.85 on June 1. Apparently this means that right now the investors and market sentiment is not really favorable for ADRO. However, this downward trend can be certainly seen as a reversal for the positive around the time when positive headline data for other or similar candidates are released. Existing investors should hold on to the data keeping in mind non-negative reports published so far and the improving financial component of the recent Q1 results. New investors may buy into the stock at an attractively low price point to derive the benefit of a slow maturing stock over the longer term.
Stocks in News: MNKD, CMRX
Discussion: MannKind announced the completion of a Phase 1 clinical trial that assessed safety, tolerability and pharmacokinetics of Treprostinil Technosphere (‘TreT) in patients with pulmonary arterial hypertension (‘PAH). PAH refers to a condition of unusually high blood pressure inside the arteries of heart. Test results indicate TreT’s possibility of inducing plasma concentrations higher than presently commercially available inhaled TYVASO (treprostinil). Results also showed the quick response rate of less than 10 seconds in which TreT could deliver its results within 1-2 inhalations. The company announced its plan to forward the candidate into the next phase to pursue a shortened 505(b)(2) regulatory process that will allow the inclusion of data generated by others. The company expects applying for a marketing application in the U.S. in the 2H of 2020.
PAH is a serious condition that is also progressive in nature. The disease is characterised by high pulmonary arterial pressure (‘PAP) and pulmonary vascular resistance (‘PVR). This may lead to right ventricular failure, and even death. PAH is a rare disease with an estimated prevalence from 10-25/ 1M.
Discussion: Chimerix’s (NASDAQ:CMRX) brincidofovir for the treatment of smallpox received Orphan Drug status from the FDA. Once approved this will allow the drug to enjoy an exclusive status for seven years in the U.S. Brincidofovir is an antivirus that targets all five families of DNA viruses affecting humans. Two of the deadly DNA viruses are adenoviruses and variola virus. Among many types of adenoviruses are those that cause gastroenteritis and respiratory disease in humans. Then we have varicella-zoster virus, which causes chickenpox in children and shingles in adults. The final large variola DNA virus that can infect humans is smallpox. Due to successful vaccination programs smallpox eradication took place in 1970. However, research on smallpox virus as well as that on smallpox antivirus is continuing for a specific reason. Even other pox-like viruses like monkeypox is capable of affecting both animals and humans, variola virus causes diseases only in human beings. This makes it a unique example to understand and study the virus infection of the cell and the response produced by human immune system to the virus infection. Therefore, the importance of reaching Phase 3 trial stage and the prospect of the receipt of FDA ODD status is not related to a direct market prospect. Rather the research and development on variola virus will contribute to several areas related to public health. Research in this area will lead to better antiviral drugs and vaccines and improving tests to detect variola and similar virus. Research and storage of variola virus is supervised by WHO.
In pipeline Chimerix has three more treatment targets for its brincidofovir (BCV, CMX001). These are in treatment for adenovirus (reached mid-Phase II), treatment of viral infection (Phase II) and Norovirus (reached Phase 1b phase).
In other News
Senseonics (NYSEMKT:SENS) and Beta Bionics agreed to integrate glucose data from the implantable Eversense Continuous Glucose Monitoring (CGM) system into Beta's iLet Bionic Pancreas system.
Biotherapeutics' (NASDAQ:IOVA) lead candidate LN-144 (lifileucel) began dosing its first patient in Phase 2 clinical trial in metastatic melanoma patients. Estimated completion date is March 2019.
Lipocine (NASDAQ:LPCN) announced first patient dosing in a clinical trial of TLANDO (testosterone undecanoate) on ambulatory blood pressure in adult males with hypogonadism. Topline data is expected in year-end.
Cellectar Biosciences (NASDAQ:CLRB) announced the receipt of a USPTO Notice of Allowance for a new patent covering PET imaging agent CLR 131 for treatment of various types of cancers.
Pfizer (NYSE:PFE) announced FDA acceptance under Priority Review company’s marketing application for PARP inhibitor talazoparib for the treatment of BRCA-mutated HER2-negative metastatic breast cancer. PDUFA is in December. Earlier, EMA accepted the marketing application for the same patient group.
Ophthotech Corporation (NASDAQ:OPHT) entered into a global license agreement with the University of Florida Research Foundation and the University of Pennsylvania to develop and commercialize a novel adeno-associated virus gene therapy for the treatment of rhodopsin-mediated autosomal dominant retinitis pigmentosa (RP).
FibroGen (NASDAQ:FGEN) concludes enrollment in Phase 3 clinical trials to support a U.S. marketing application for roxadustat in anemia associated with chronic kidney disease (‘CKD). The studies will assess the use of roxadustat in both dialysis-dependent and non-dialysis-dependent CKD patients.
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.
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