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Cowen & Co Shares Positive Outlook On Celldex Therapeutics Following FDA ‘Breakthrough’ Approval

Shares of Celldex Therapeutics (NASDAQ: CLDX) shot up about 17.5% in trading on February 23rd following the company’s announcement that it was granted FDA approval for rindopepimut (Rintega), a therapy used to treat adult patients with EGFRvIII-positive glioblastoma (GBM). The FDA approved the treatment through Breakthrough Designation, which accelerates the development and review of drugs for serious or life-threatening conditions.

Rindopepimut targets the tumor specific oncogene EGFRvIII in patients with glioblastoma. Patients with this tumor have a lower survival rate than the overall glioblastoma population. Rindopepimut is only the third treatment for patients with glioblastoma that has been approved by the FDA in over 20 years.

Anthony Marucci, Co-founder, President and Chief Executive Officer of Celldex Therapeutics said in a statement, “The FDA’s decision to grant Breakthrough Designation underscores rindopepimut’s therapeutic potential for patients with glioblastoma…These patients have extremely limited treatment options, with only three new drugs approved in more than twenty years. Emerging clinical data suggests that rindopepimut may offer an improvement over existing standard of care for EGFRvIII-positive patients. With continued positive data, we look forward to working closely with the FDA to support potential approval of rindopepimut as expeditiously as possible.”

Celldex is also poised to announce its fiscal fourth quarter earnings report on Tuesday, February 24th before the market opens. The company is expected to post a loss of -$0.35 a share, down from a loss of -$0.27 a share the same quarter a year prior.

Celldex has a handful of treatments in its pipeline that are currently being tested. Investors will be looking for an update on the company’s pipeline in addition to its fourth quarter results.

Cowen & Co. analyst Boris Peaker weighed in on Celldex Therapeutics following the FDA approval announcement of rindopepimut. According to SmarterAnalyst, the analyst reiterated an Outperform rating on the stock with a $26 price target.

Peaker noted “This designation now gives CLDX more intensive FDA guidance on the development of rindo, which we believe will become important as CLDX decides whether to file for accelerated approval based on ReACT. Moreover, rindo will now receive expedited review and can file on a rolling basis. All of this further strengthens rindo’s position as the ReACT data matures and CLDX considers filing in 2015.” He added, “We continue to believe that rindo has a very good chance of approval on the ReACT data. For reference, in 2009 Avastin was approved in 2nd-line GBM based on two open-label studies that demonstrated durable ORRs, but no PFS or OS benefit. In our view the rindo dataset will likely be much stronger, with blinded randomized data, OS, PFS, and a diagnostic biomarker.”

Boris Peaker has rated Celldex Therapeutics 18 times since June 2013, earning a 61% success rate recommending the company and a +24.0% average return per recommendation. Overall, Peaker has a 66%s success rate recommending stocks and a +36.3% average return per recommendation.

Boris Peaker has a lot of experience rating healthcare stocks, such as Idera (NASDAQ: IDRA) and Curis Inc (NASDAQ: CRIS). The analyst has rated Idera 4 times since August 2014 with a 100% success rate and a +58.6% average return. Likewise, Peaker has rated Curis Inc 6 times since April 2014 with a 100% success rate recommending the company and a +58.6% average return per recommendation.

However, Peaker has not always been so accurate with his recommendations. The analyst has rated ImmunoGen (NASDAQ: IMGN) 4 times since September 2012 with no success and a -1.6% average loss per recommendation.

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