Deerfield Beach, FL / Aug 20, 2014 / It has been a disappointing year for biotechnology stocks so far after last year’s surge. The correction was expected after last year’s surge; however, the losses were accentuated after Fed Chair Janet Yellen’s comments earlier this year regarding a possible bubble in biotech and social media stocks.
While Yellen’s concerns are understandable, the surge in the biotech stocks cannot be compared to the tech bubble of the late 90s or the housing market bubble of the previous decade. There are a number of biotech companies with significant potential. Some of the smaller companies are an attractive takeover target for big pharma companies that are looking to boost their product pipeline in the wake of expiration of patents on some of their blockbuster drugs.
There are some other biotech companies that are on the verge of gaining a regulatory approval for their lead products. Others are in the Phase I/II trial phase for their drugs that seek to address significant unmet medical needs. Indeed, the biotech sector has some very interesting companies. Here is a look at some.
Ruthigen Inc. (RTGN): Based in Santa Rosa, California, Ruthigen completed its IPO earlier this year. Since listing, Ruthigen shares have fallen nearly 27%. However, the losses can be attributed to the decline in biotech sector in general. The company itself has been making significant progress.
Through its lead product candidate, RUT 58-60, Ruthigen is looking to target the surgical site infection (SSI) market. SSIs are the second most common type of healthcare-associated infections (HAIs) in the U.S. and several other developed countries, and inflict substantial cost on the healthcare system.
On August 14th, Ruthigen reported its financial results for the fiscal first quarter of 2015 that ended on June 30th, 2014. At the end of the quarter, the company had cash of $14.3 million on its balance sheet, compared to $15.6 million reported at the end of the previous quarter.
Ruthigen also provided an update on its activities. In July, the company started human clinical testing of RUT 58-60 in its 21-day skin irritation trial. The company said that it completed the skin irritation trial with 36 human subjects this month. The human subjects participated in the trial for 21 consecutive days.
Aegerion Pharmaceuticals Inc. (AEGR): Aegerion Pharmaceuticals is a very interesting biotechnology company. Although a one-drug company, there have great expectations from Aegerion ever since its JUXTAPID® (lomitapide) was approved by the Food and Drug Administration (FDA) for the treatment of patients with homozygous familial hypercholesterolemia (HoFH).
HoFH is a rare disease, and therefore Aegerion was granted an orphan drug designation for JUXTAPID. However, the drug has been slow to take off. Not surprisingly, this has hurt shares of Aegerion, which are down more than 58% so far this year. The stock had peaked in October last year when it crossed $100. The stock’s 52-week high is $101. However, since then, it has fallen significantly.
Aegerion shareholders, though, would have been relieved after the company recently posted encouraging second-quarter results. The company achieved $36 million in net product sales of JUXTAPID for the second quarter, up 29% over the net product sales in the previous quarter.
The company’s net product sales improved in the second quarter on a sequential basis as it experienced meaningful growth in the number of U.S. prescriptions written and HoFH patients coming onto therapy.
AVEO Pharmaceuticals Inc. (AVEO): Based in Cambridge, Massachusetts, AVEO Pharmaceuticals is engaged in the discovery, development and commercialization of targeted cancer therapies using its Human Resource Platform.
AVEO, earlier this week, released its financial results for the second quarter and provided an update on its progress toward achieving its strategic plan. The company said that it regained the worldwide rights to tivozanib from Astellas Pharma Inc. Tivozanib, an inhibitor of vascular endothelial growth factor (VEGF) 1, 2, and 3 receptors, is being developed for the treatment of renal cell carcinoma, colorectal cancer and breast cancer.
At the end of the second quarter, AVEO had $64.9 million in cash, cash equivalents and marketable securities. The company had net cash outflows of around $23 million in the second quarter of 2014, down from $30 million in the first quarter of 2014.
Achillion Pharmaceuticals Inc. (ACHN): Achillion Pharmaceuticals Inc. shares surged on Friday after the company announced that it achieved 100% sustained virologic response rate (SVR4) from an eight-week Phase II trial evaluating a ribavirin-free regimen of ACH-3102 and sofosbuvir for genotype 1 hepatitis c virus (HCV) infection.
Achillion said that of the 12 patients treated with ACH-3102, a second-generation NS5A inhibitor, in combination with sofosbuvir, 100% remained HCV RNA undetectable for weeks after completing therapy. Following the positive results, the company will begin treatment on 12 additional patients with six weeks of once daily ACH-3102 and sofosbuvir.
At last check on Friday, shares of Achillion Pharmaceuticals were trading 12.32% higher at $9.48 on above average volume of 15.28 million. Earlier in the day, the stock hit a 52-week high of $9.94. So far this year, Achillion shares have gained more than 188%, making it one of the few biotech stocks that have done well this year.
Emerging Equities Report
Source: Emerging Equities Report