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Biotech Stock Roundup: ALXN Up on Acquisition News, PFE-BNTX Get EUA for Vaccine & More

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Zacks Equity Research
·7 min read
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Quite a few regulatory and pipeline updates grabbed the spotlight in the biotech sector in the past week. Acquisitions again take center stage in the sector. Meanwhile, COVID-19 vaccine updates gain more significance in the sector with each passing day as the pandemic registers a spike again.

Recap of the Week’s Most Important Stories

Alexion Jumps on Merger News With AstraZeneca: Shares of Alexion ALXN surged more than 30% after the company entered into a definitive agreement with U.K.-based pharmaceutical company, AstraZeneca plc AZN, whereby the latter will acquire the former.

Per the terms, Alexion’s shareholders will receive $60 in cash and 2.1243 AstraZeneca American Depositary Shares (ADSs) for each Alexion share. Each ADS represents one-half of one ordinary share of AstraZeneca, as evidenced by American Depositary Receipts (ADRs).

Based on AstraZeneca's reference average ADR price of $54.14, this implies a total consideration of $39 billion or $175 per share to Alexion’s shareholders. This represents a 45% premium based on the closing stock price of Alexion on Dec 11, 2020. The acquisition will enable AstraZeneca to strengthen its position in immunology. AstraZeneca already has a strong presence in oncology, cardiovascular, renal and metabolism, and respiratory diseases and the acquisition will enable AstraZeneca to strengthen its position in immunology, given Alexion’s strong rare disease portfolio with drugs like Soliris and Ultomiris.

The acquisition is expected to close in the third quarter of 2021. While Alexion has solid growth prospects on a standalone basis, the combination will give it a chance to globalize its portfolio further. Moreover, upon completion, Alexion’s shareholders will own 15% of the combined company. The acquisition will also enable the company to advance its deep pipeline, as Alexion has been progressing from ultra-orphan to orphan and specialty conditions.

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

Gilead Not to Advance Jyseleca in the United States: Gilead Sciences, Inc. GILD and Galapagos have decided to amend their existing arrangement for the commercialization and development of Jyseleca (filgotinib). Gilead has now decided that it will not seek FDA approval of filgotinib for rheumatoid arthritis (RA). The decision follows a type A meeting with the FDA to discuss the points raised in the Complete Response Letter (CRL) related to the New Drug Application (NDA) for filgotinib for the above-mentioned indication.

Gilead has concluded that the 200 mg dose is required to be competitive in RA in the United States. However, the 200 mg dose is unlikely to achieve approval for RA in the United States without conducting substantial additional clinical studies. Galapagos will assume the sole responsibility of the drug in Europe in RA, where 200 mg and 100 mg doses are approved for the treatment of moderate to severe RA, and in all future indications. Both companies will evaluate the potential for filgotinib to support patients living with Inflammatory Bowel Disease (IBD). Gilead will retain operational responsibility for the current trials in Crohn’s disease while Galapagos will assume operational responsibility for ongoing trials in UC (ulcerative colitis).

Gilead will receive royalties on European sales starting 2024. Gilead will pay Galapagos €160 million to support ongoing development and accelerated commercial buildout in the EU.

Earlier, Gilead announced that it will acquire a private, commercial-stage German biotechnology company MYR GmbH for €1.15 billion in cash, payable upon closing the transaction, along with a potential future milestone fee of up to €300 million (both payments are subject to customary adjustments). The acquisition will add hepatitis delta virus (HDV) treatment, Hepcludex (bulevirtide), to Gilead’s portfolio.

Pfizer/BioNTech’s Coronavirus Vaccine Gets EUA: BioNTech BNTX and partner Pfizer PFE announced that the FDA has authorized the emergency use of their mRNA vaccine, BNT162b2, against COVID-19 in individuals 16 years of age or older. The agency granted an Emergency Use Authorization (EUA) to the vaccine as both companies gather additional data and prepare to file a planned Biologics License Application (BLA) with the FDA for a possible full regulatory approval in 2021.

The FDA’s decision was based on data from a phase III study, which showed that BNT162b2 met all of the study’s primary efficacy endpoints. Data showed an efficacy rate of 95% in participants without prior SARS-CoV-2 infection (first primary objective) and also in those with and without prior SARS-CoV-2 infection (second primary objective), in each case measured from 7 days after the second dose.

Arvinas Surges on Positive Pipeline Updates: Shares of clinical-stage biopharmaceutical company Arvinas, Inc. ARVN soared significantly after it announced updates for its PROTAC protein degraders ARV-471 and ARV-110. Interim data from a phase I study showed that ARV-471 demonstrated improved superiority compared to the current standard of care agent (fulvestrant) in certain breast cancer patients. The candidate showed evidence of anti-tumor activity and potential for best-in-class safety, and estrogen receptor (ER) degradation profile and robust efficacy signals in a heavily pretreated patient population.

Separately, the ongoing dose-escalation portion of the phase I/II study for ARV-110 in men with metastatic castration-resistant prostate cancer (mCRPC) provided additional evidence of anti-tumor activity and patient benefit. The company has initiated a phase II dose expansion to explore a two-pronged development strategy, including the potential for accelerated approval in molecularly defined, late-line patients, and broader development in less-heavily pretreated mCRPC patients with fewer androgen receptor (AR)-independent mechanisms of tumor resistance.

COVID-19 Vaccine Update From Moderna: Moderna, Inc. MRNA announced that the first adolescent participants have been dosed in the phase II/III study of its mRNA-based coronavirus vaccine candidate, mRNA-127, in adolescents aged 12 to less than 18 years. The study is being conducted in collaboration with the Biomedical Advanced Research and Development Authority (BARDA). This randomized, controlled, phase II/III study will evaluate the safety, reactogenicity and immunogenicity of two vaccinations of mRNA-1273 given 28 days apart. The company plans to generate sufficient data by mid-2021 to support regulatory filings, seeking emergency authorization/approval for use of mRNA-1273 in adolescents.

Performance

Medical - Biomedical and Genetics Industry 5YR % Return

 

Medical - Biomedical and Genetics Industry 5YR % Return
Medical - Biomedical and Genetics Industry 5YR % Return

Medical - Biomedical and Genetics Industry 5YR % Return

The Nasdaq Biotechnology Index gained 2.31% in the last five trading sessions. Among the biotech giants, Alexion gained 32.45% during this period. Over the past six months, shares of Amgen have rallied 42.98%. (See the last biotech stock roundup here: Biotech Stock Roundup: ASH Data in Focus, CRIS, BCRX Surge & More Pipeline News)

What's Next in Biotech?

Stay tuned for more pipeline and regulatory updates.

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Alexion Pharmaceuticals, Inc. (ALXN) : Free Stock Analysis Report
 
AstraZeneca PLC (AZN) : Free Stock Analysis Report
 
Pfizer Inc. (PFE) : Free Stock Analysis Report
 
Gilead Sciences, Inc. (GILD) : Free Stock Analysis Report
 
Moderna, Inc. (MRNA) : Free Stock Analysis Report
 
Galapagos NV (GLPG) : Free Stock Analysis Report
 
Arvinas, Inc. (ARVN) : Free Stock Analysis Report
 
BioNTech SE Sponsored ADR (BNTX) : Free Stock Analysis Report
 
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