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Biotech Stock Roundup: RNA Up on BMY Deal Expansion, BIVI Down on Setback & More

The focus is back on regular drug approvals and other pipeline and regulatory updates in the biotech sector. Quite a few other companies offered important updates on their key candidates.

Recap of the Week’s Most Important Stories:

RNA Surges on Deal Expansion:  Shares of Avidity Biosciences, Inc. RNA soared 14.9% following the expansion of its global licensing and research collaboration with biotech giant Bristol Myers Squibb BMY.

Avidity announced a research collaboration with MyoKardia in 2021 to demonstrate the potential utility of antibody oligonucleotide conjugates (AOCs) in cardiac tissue. MyoKardia was acquired by Bristol Myers in 2020.

The expanded collaboration will focus on the discovery, development and commercialization of up to five cardiovascular targets leveraging Avidity's proprietary AOC platform technology, with potential cumulative payments of up to $2.3 billion.

Per the terms of the agreement, Bristol Myers will make an upfront cash payment of $60 million to Avidity. BMY will also purchase approximately $40 million of Avidity’s common stock at a price of $7.88 per share.

In addition, Avidity is entitled to receive up to approximately $1.35 billion in research and development milestone payments, up to roughly $825 million in commercial milestone payments and tiered royalties up to low double-digits on net sales. Any expenses related to clinical development, regulatory and commercialization activities arising from this collaboration will also be funded by Bristol Myers. The infusion of cash by bigwig BMY boosted investor sentiment, leading to the rise in share price.

Avidity currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Regulatory Updates From Vertex: Vertex Pharmaceuticals Incorporated VRTX announced that the European Medicines Agency has validated a type II variation application to the marketing authorization for blockbuster cystic fibrosis (CF) medicine, Kaftrio.

The application seeks an expansion of the approved indication for Kaftrio in a combination regimen with Kalydeco (ivacaftor) for the treatment of people with CF aged two and above who have a mutation in the cystic fibrosis transmembrane conductance regulator gene that is responsive based on clinical and/or in vitro data, including the N1303K mutation. The Committee for Medicinal Products for Human Use will now review the application and issue an opinion to the European Commission (“EC”) on the same.

A day before, VRTX obtained the EC’s approval for the label expansion of Kaftrio for treating children two to five years old. The EC approved Kaftrio in combination with Kalydeco for treating CF in children who have at least one F508del mutation in the CF transmembrane conductance regulator gene. The drug is already approved in the EU for the same indication in patients aged six years and older.

Updates From Arcturus: Arcturus Therapeutics ARCT announced that the FDA has granted orphan drug designation for the company’s product candidate ARCT-032 to treat CF. The FDA grants the designation to support the development of medicines for rare disorders that affect fewer than 200,000 patients in the United States. Shares were up on the news.

The designation will give Arcturus market exclusivity for ARCT-032 for a predefined period in the CF indication, along with the exemption of FDA application fees and tax credits for qualified clinical studies, all subject to approval. Arcturus said that the first CF patient in its early-stage study of ARCT-032 has successfully completed two administrations of the investigational drug candidate. The company is on track to share interim results from the phase Ib study in the first half of 2024.

BioVie Down on Study Results: BioVie Inc. BIVI announced a positive analysis of top-line efficacy data from its phase III study of its investigational candidate, NE3107, in the treatment of mild to moderate Alzheimer’s Disease (AD). The advantage of treating AD patients with NE3107 compared to placebo in the late-stage study demonstrated a benefit equal to or greater than that offered by currently approved monoclonal antibodies in the treatment of AD without the associated safety concerns. BioVie reported that NE3107-treated patients experienced an age deceleration advantage by 4.66 months to a year compared to placebo, as measured by epigenetics/DNA methylation Skin Blood Clock.

However, the stock declined due to investors’ skepticism regarding the results announced, fueled by significant study conduct violations and protocol deviations reported by the company.  The phase III study of NE3107, initiated during the COVID-19 pandemic, enrolled a total of 439 AD patients. After completion of the study, BioVie observed significant deviation from protocol and good clinical practice violations in several study sites.

Based on this development, BioVie decided to exclude all patients treated with the candidate in these study sites from the analysis of study efficacy data. BioVie also reported that due to the exclusions made from the initial patient population, the primary efficacy endpoint of the study missed achieving statistical significance.

Performance

The Nasdaq Biotechnology Index has gained 0.49% in the past four trading sessions. Among the biotech giants, Regeneron has gained 1.11% during the period. Over the past six months, shares of Moderna have plunged 38.70%. (See the last biotech stock roundup here: Biotech Stock Roundup: BMY, TSVT Down on Setback, TRDA, MOR Offer Updates).

 

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What's Next in Biotech?

Stay tuned for more pipeline updates.


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