Gilead (GILD), Tentarix To Develop Cancer, Inflammation Therapies
Gilead Sciences, Inc. GILD announced a collaboration with Tentarix Biotherapeutics to discover and develop novel therapies for cancer and inflammation.
Both companies established three multi-year collaborations leveraging Tentarix’s proprietary Tentacles platform to discover and develop multi-functional, conditional protein therapeutics for oncology and inflammatory diseases.
Per the terms, Tentarix will get upfront payments and an equity investment from Gilead totaling $66 million across the three collaborations. Gilead will have the option to acquire up to three select Tentarix subsidiaries containing the programs developed under the collaborations for $80 million per subsidiary.
Gilead expects Tentarix to complement its ongoing efforts, build upon its growing strength in protein therapeutics and provide access to next-generation, multi-specific biologics.
Gilead expects this transaction to reduce its bottom line in 2023 (both on a GAAP and a non-GAAP basis) by approximately 3-4 cents.
Shares of Gilead have lost 7.3% in the year so far compared with the industry’s decline of 12.6%.
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GILD is looking to diversify in the lucrative oncology space as competition is stiffening in its HIV business, which has been the growth engine.
The oncology business put up a stellar performance in the first half of 2023, fueling its top line. The Cell Therapy franchise, comprising Yescarta and Tecartus, continues to witness a steady increase in sales, primarily due to higher demand for Yescarta in relapsed or refractory (r/r) large B-cell lymphoma and Tecartus in adult R/R B-cell precursor acute lymphoblastic leukemia and mantle cell lymphoma in the United States and Europe.
The uptake of the breast cancer drug Trodelvy has been robust due to increased adoption in pre-treated HR+/HER2- metastatic breast cancer in the United States.
Gilead is making efforts to strengthen its pipeline in this space through strategic collaborations and acquisitions and is not investing in developing a candidate from scratch in the oncology space.
In May 2023, Gilead acquired the privately held biotech company XinThera. The acquisition complements Gilead’s existing clinical development priorities by adding additional pipeline assets in oncology and inflammation.
Earlier, it entered into a strategic collaboration with Arcellx, Inc. ACLX to co-develop and co-commercialize CART-ddBMCA, a late-stage clinical asset in development for the treatment of multiple myeloma.
However, Arcellx announced that the FDA placed a clinical hold on its iMMagine-1 program, designed to evaluate the lead program, CART-ddBCMA, for treating adult patients with relapsed or refractory multiple myeloma. The hold was placed on Jun 16 after a patient died.
Arcellx believes limitations on bridging therapy are a contributing factor and is working with the FDA to amend the protocol to expand options for patients that are consistent with current clinical practice.
Zacks Rank & Stocks to Consider
Gilead currently carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks in the overall healthcare sector are Spero Therapeutics SPRO and Dynavax Technologies DVAX. While SPRO sports a Zacks Rank #1 (Strong Buy), DVAX carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The loss per share estimate for SPRO for 2023 has narrowed by 54 cents to 51 cents in the past 30 days. Spero’s earnings beat estimates in all of the trailing four quarters, the average surprise being 72.43%.
The loss per share estimate for DVAX has narrowed by 5 cents to 27 cents for 2023 in the past 30 days. Dynavax has risen 33.8% in the year-to-date period. DVAX’s earnings beat estimates in two of the trailing four quarters and missed in the remaining two, the average surprise being 25.78%.
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