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Why Is ImmunoGen (IMGN) Stock Up More Than 150% This Year?

Zacks Equity Research

Shares of ImmunoGen, Inc. IMGN have been massively up 192.7% this year so far, outperforming the industry’s registered 4.3% increase. Let’s analyze the factors that led to this rally.

ImmunoGen’s rapid pipeline progress along with positive readouts and strategic collaborations has pushed its share price up consistently.

ImmunoGen has made a significant progress with regard to its lead pipeline candidate, mirvetuximab soravtansine this year. The candidate is being evaluated in a phase III study (FORWARD I) on as a single-agent therapy for treating patients with platinum-resistant ovarian cancer.

The company has presently activated over 90 sites for enrolment under the trial, which it aims to complete by the middle of 2018. Also, the candidate is being evaluated in three phase I expansion cohorts on 113 ovarian cancer patients. In May, the company reported positive data from the study which demonstrated promising safety and efficacy profile of the candidate.

Meanwhile, combination regimens with mirvetuximab soravtansine in ovarian cancer are also being evaluated in phase Ib/II FORWARD II study. The FORWARD II trial consists of cohorts assessing mirvetuximab soravtansine in combination with Roche's RHHBY Avastin and Merck’s MRK Keytruda.

In May, ImmunoGen had reported initial data from this study, showing mirvetuximab soravtansine with potential to complement the currently available therapies for the indication. Approval for any of these combination regimes will significantly expand the eligible patient population for mirvetuximab soravtansine.

An approval of mirvetuximab soravtansine would be a huge boost to ImmunoGen, given its immense commercial potential in the target market. Ovarian cancer results in maximum annual deaths among gynecologic cancers with majority of the patients diagnosed at an advanced stage.

Per data provided by the American Cancer Society, approximately 22,440 new cases of ovarian cancer will be diagnosed in the United States in 2017, resulting in more than 14,080 deaths.

Apart from mirvetuximab soravtansine, ImmunoGen is working on developing a couple of other clinical/pre-clinical candidates including IMGN779 and IMGN632. Notably, IMGN779 is being evaluated in a phase I study for treating acute myeloid leukemia (“AML”) with data expected later this year. On the other hand, the company plans to move IMGN632 into clinical development before the year-end to treat hematological malignancies including AML.

ImmunoGen has agreements with several big healthcare companies including Amgen, Bayer, Eli Lilly LLY, Novartis, Roche, Sanofi and Takeda. These contracts allow other companies to use ImmunoGen’s ADC technology and provide it with funds in the form of license and milestone fees, royalties, clinical materials revenues and R&D support fees.  

Notably, in August, ImmunoGen had announced a strategic collaboration and option agreement with Jazz Pharmaceuticals for development and commercialization of the two candidates under ADC programs, IMGN779 and IMGN632. Pursuant to the deal, ImmunoGen would be eligible to receive milestone payments based on certain pre-decided conditions.

Though the platinum-resistant ovarian cancer market offers an immense commercial potential, ImmunoGen is notably set to face intense competition, upon approval. However, mirvetuximab soravtansine looks promising at this juncture and its approval will be a big lift to the company.

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

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