For better or worse, “investing” in biotech stocks has largely become a matter of looking for catalysts and placing your bet on the outcome.
With that as the backdrop, the fourth quarter of 2015 is slated to supply plenty of these decisions and updates on some of the market’s most watched drugs.
To help investors navigate the biggest and best biotech trading opportunities, here’s a closer look at the top 10 industry events that could really move their respective stocks in Q4 … one direction or the other.
Biotech Stocks to Watch: Merck (MRK)
It’s more often classified as a pharmaceutical company than lumped in with true biotech stocks, but Merck (MRK) still has biotech news in the queue that could prove to be a big deal for MRK shares.
On Oct. 2, the U.S. Food and Drug Administration will make an approval/no-approval decision on pembrolizumab, or Keytruda, as a treatment for non-small cell lung cancer.
Keytruda is already approved as a therapy for melanoma, and although skin cancer is a relatively crowded field and NSCLC isn’t exactly competition-free either, Keytruda is a drug worth keeping an eye on simply because it was the country’s first approved anti-PD1 (programmed cell death) treatment … a category of drugs that has becoming quite promising.
At stake for Merck is a piece of the U.S. portion of the NSCLC market that was worth nearly $7 billion last year.
Biotech Stocks to Watch: Spectrum Pharmaceuticals (SPPI)
That’s when the FDA is going to make a decision on Captisol-Enabled Melphalan … a drug co-developed by LGND and SPPI.
Melphalan, in simplest terms, “primes” a multiple myeloma patient about to undergo a stem cell transplant. This particular version of the therapy (which is not only captisol-enabled but also propylene glycol-free) reduces common renal and heart problems associated with typical Melphalan, which in turn means infusion rates can be slowed down to make them more effective.
Biotech Stocks to Watch: Macrocure (MCUR)
Whereas Spectrum and Ligand are off-the-radar biotech stocks, Macrocure (MCUR) is downright obscure, perhaps to the point of being unknown to most.
But the more obscure the company, the bigger the impact of news can be.
That’s why biotech speculators will want to keep an eye on MCUR over the course of October. Sometime this month, the company is expected to post an update on its phase 3 trial of CureXcell as a treatment for venous leg ulcers.
Just so there’s no misunderstanding, the company reported in August it doesn’t believe CureXcell will reach the trial’s desired endpoint. But Macrocure does believe there were some encouraging results observed during the trial, and it may be possible to salvage the drug yet.
If there is, a big piece of August’s 75% plunge could be undone.
Biotech Stocks to Watch: Merrimack Pharmaceuticals (MACK)
Abraxane and gemcitabine are the current standard of frontline treatment for pancreatic cancer, and it’s unlikely MM-398 from Merrimack Pharmaceuticals (MACK) will dethrone that option anytime soon.
But the drug could make some waves within the world of second-line pancreatic cancer treatments. We’ll know more to that end on Oct. 24 when the FDA lets investors know what it thinks of the drug’s phase 3 results.
Though not quite as telling as the FDA’s “orphan drug” designation that seems to give so many biotech stocks a little extra bullish zing, MM-398 has been given priority review. This suggests the FDA saw enough in the results thus far to at least make an effort to get it to the market as quickly as possible, if it likes what it sees upon the deeper review of the drug.
Biotech Stocks to Watch: Repros Therapeutics (RPRX)
November is going to be a doubly exciting month for Repros Therapeutics (RPRX).
On Nov. 3, the FDA’s advisory panel will make a recommendation to the agency on whether to approve Androxal as a treatment for secondary hypogonadism. Then on Nov. 30, the FDA will officially take or ignore that advice.
Either or both could push the stock around.
Hypogonadism is two-dollar word for low testosterone, and is generally associated linked with obesity. Where Androxal differs from other drugs — and where RPRX differs from other biotech stocks working on similar treatments — is its delivery. Androxal is an orally administered therapy.
Biotech Stocks to Watch: Gilead Sciences (GILD)
There are several companies with sizable stakes in the business of HIV treatments, but none sell more HIV drugs than Gilead Sciences (GILD). And GILD may be on the verge of taking it up a notch.
How so? On Nov. 5, the FDA is expected to make a decision on a once-daily single tablet regimen that combines Gilead’s emtricitabine, tenofovir alafenamide, and rilpivirine. Tenofovir alafenamide (or TAF) is the game-changer in the mix. It’s a prodrug of tenofovir, which is the active part of Gilead’s Viread, although TAF requires only about a 10th of the dose, and boasts an attractive renal and bone safety profile.
Norbert Bischofberger, executive vice president of research and development for Gilead Sciences, noted of the drug:
“This TAF-based regimen has the potential to provide a range of HIV patients with a highly effective and well-tolerated new treatment option with a favorable safety profile. Gilead remains focused on advancing next-generation therapies that have the potential to improve HIV treatment over the long-term and TAF will be the cornerstone of future Gilead single tablet regimens.”
Biotech Stocks to Watch: Cerulean Pharma (CERU)
Add Cerulean Pharma (CERU) to a list of biotech stocks to watch closely in December (or maybe sooner) for an update on one of its key trials, though unfortunately, there’s no specific date yet for that update — it could happen anytime that month.
The drug in question is cancer-fighting therapy CRLX-101. CRLX-101 is a less toxic topoisomerase 1 inhibitor in the camptothecin family. The drug also increases effectiveness of such drugs by increasing the so-called “payload” delivered to tumorous cells. CLRX-101 is also an HIF-1a inhibitor, which is (in very rudimentary terms) a tumor’s way of resisting traditional cancer treatments.
To date, Cerulean Pharma has three trials of the drug underway … a phase 2 trial for renal cell carcinoma, a phase 2 trial for non-metastic rectal cancer, and a phase 2 trial as a therapy for ovarian cancer (administered with Avastin).
CERU has reported it intends to post an official update of the ovarian cancer and rectal cancer studies before the end of the year.
Biotech Stocks to Watch: Achillion Pharmaceuticals (ACHN)
As was the case with Cerulean Pharma (and the case with several other biotech stocks through the end of the year), it’s not clear when we’ll get a couple of key updates on ACH-3102 from Achillion Pharmaceuticals (ACHN).
We do know, however, the company has said it aims to unveil those updates before the end of the year. If it hasn’t happened in October or November, December will almost assuredly be the month.
ACH-3102 takes aim at hepatitis C. Two different studies of the drug in that capacity are underway. One of them is a look at how it performs with ACH-3422 and sovaprevir. The other is a review of how it does in conjunction with just sovaprevir.
In light of the stunningly high price of relatively new — but very effective — hepatitis C drugs Harvoni and Sovaldi from Gilead, a lot of eyes are looking at alternatives that could put some new competition on the field.
Biotech Stocks to Watch: GW Pharmaceuticals (GWPH)
A whole slew of companies rose to prominence a couple of years ago when marijuana legalization (medical and recreational) became a hot button. One of the few in that group that’s actually a legitimate, serious company, however, is GW Pharmaceuticals (GWPH).
And December should be a very busy month for the company.
GW Pharmaceuticals has several things in the pipeline, with updates due for many of them before the end of the year. That means it’s going to be happening in December, assuming the company isn’t able to squeeze them in before then.
Among the news in the queue is an update on GWP-42003 as a therapy for schizophrenia, an update on phase 3 drug Epidiolex as a treatment for Dravet Syndro as well as for Lennox-Gastaut syndrome, and a look at more data from the phase 3 Sativex trial as a therapy for cancer pain.
Biotech Stocks to Watch: Clovis Oncology (CLVS)
Last but not least, put Clovis Oncology (CLVS) on your Q4 watch list of biotech stocks. It has a fairly big update and a big milestone in its lineup as well.
Lucitanib is currently in phase 2 trials as therapy for breast cancer. The company plans on giving investors some to-date results for those trials before the end of the year, though it could possibly happen before December.
The proverbial big Kahuna in the queue for Clovis Oncology, however, is the launch of Rociletinib as a treatment for EGFR-mutated non-small cell lung cancer. Though the most recent report says the FDA could make the final decision as late as March 30, it could possibly come before then … maybe even before the end of the year.
That’s right — the drug has not even been approved yet; the company only requested approval in early August. But, in that the FDA has given it a breakthrough designation, hopes are understandably high, and Clovis appears immediately ready to put the drug on the market as a therapy for NSCLC.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.