Zacks Equity Research

About the Author Zacks Equity Research brings the decades of study and stock picking expertise of Zacks Investment Research to individual investors. Now, you don't need to be an investment bank or brokerage firm to get the professional power of Zacks' research. It's all available on Learn more about Zacks' history and company on our website.

Zacks Updates: Facebook Inc (FB), Intercept Pharmaceuticals Inc (ICPT), Relypsa Inc (RLYP)

Facebook Inc

Facebook Inc (NASDAQ:FB) has added some new features to its Facebook Live to give people “more ways to discover, share, and interact with live video, and more ways to personalize live broadcasts.” The social service giant said that it will “dedicate” a special place for live videos on its mobile app.

Reuters puts it as Facebook’s most challenging move to get past rivals like Twitter’s Periscope, Alphabet’s YouTube and Snapchat’s video offering. It also poses serious competition to live televised broadcasting.

Facebook has long been improvising its live video format to transform it into another robust ad revenue generating platform. Online video is the most lucrative component of digital advertising. As video ads generate more revenues than their photo and text based counterparts, Facebook is trying to incorporate more and more video oriented content to bring in more ad dollars. Research firm, Forrester Research projects digital ad revenues to touch $12.6 billion by 2019.

Facebook’s gargantuan 1.6 billion user base records 100 million hours of daily video viewing.

Last year, Facebook Live was exclusively launched for celebrities and then eventually rolled out for both Android and iOS users in the U.S.

On Wednesday, Facebook announced that people can now use Facebook Live to broadcast videos in Groups and Events. Going Live in Groups means people only in the group can see the videos unlike Events. Facebook Live will enable people to hold Q&A session through events. CEO Zuckerberg tried the same but the live feed was disrupted soon after the broadcast started. Later on Zuckerberg went live again from a different location. As per CNBC, Facebook denied any technical glitch.

Moreover, the audience can respond to the live broadcast in real time through Live Reactions (same as in the news feed Reactions, which are a set of 5 emojis, namely Love, Haha, Wow, Sad or Angry). Live Reactions will show right on top of the page and broadcasters will see the profile picture of the person and a little starburst pop up before the reaction appears.

However, the live emojis will wane quickly to make the experience as interactive as possible. As per Facebook, this will let broadcasters and other viewers know people’s reaction at different points during the streaming comparing it to hearing the crowd clap and cheer. Facebook also added that an initial survey found that people reacted 10 times more to a live video than regular videos.

Other features added to Facebook Live include five filters to personalize feed as well enable doodling/drawing on live video and an option to invite friends to watch videos. Apart from all these, Facebook also launched the Facebook Live Map feature for desktops in 60 countries to let users get access to live videos from across the globe.


Intercept Pharmaceuticals Inc

Intercept Pharmaceuticals Inc (NASDAQ:ICPT) announced that the FDA’s Gastrointestinal Drugs Advisory Committee has voted unanimously (in the ratio of 17 to 0) in favor of the company’s lead pipeline candidate, Ocaliva (obeticholic acid).

The committee recommended accelerated approval of Ocaliva for the treatment of patients suffering from primary biliary cholangitis (PBC) (previously known as primary biliary cirrhosis).

We remind investors that the FDA had extended the Prescription Drug User Fee Act (PDUFA) date for priority review of Ocaliva by three months in Dec 2015. The agency was previously supposed to give a decision by Feb 29, 2016. However, it requested additional clinical data analyses, which Intercept has submitted. Consequently, the FDA now requires additional time for a full review of the submission and has extended the PDUFA date by three months to May 29, 2016.

Although the FDA is not bound to abide by the Advisory Committee’s recommendation, it generally takes the same into consideration while reviewing candidates. Upon approval, Ocaliva would be the first new treatment for PBC in almost two decades. We note that ursodeoxycholic acid (UDCA) is the only drug currently approved in the U.S. for the treatment of PBC. However, a substantial number of patients treated with UDCA have a suboptimal response or are intolerant to treatment, which has left them at a significantly high risk of an adverse outcome.

A potential approval of Ocaliva in May 2016 should boost the growth potential of the company substantially.

Relypsa Inc

Relypsa Inc (NASDAQ:RLYP) shares shot up a whopping 67% yesterday on acquisition rumors. According to a Reuters article, Relypsa is exploring the possibility of a potential sale following interest from prospective buyers. While the company is rumored to be working with an investment bank on a potential sale, people familiar with the matter said that discussions are still in an early stage and may not result in a sale.

Relypsa is being viewed as an acquisition target mainly due to its sole approved product, Veltassa. Approved for the treatment of hyperkalemia, Veltassa was launched in the U.S. in Dec 2015. The product’s initial performance has been encouraging and is expected to bring in peak sales of a billion dollars.

Ever since AstraZeneca shelled out $2.7 billion for one of Relypsa’s competitors, ZS Pharma, which had an experimental hyperkalemia treatment, ZS-9, in its pipeline, investors have been hopeful about Relypsa’s acquisition prospects considering it already has a marketed hyperkalemia treatment in its portfolio. The expectation is that the companies that were unsuccessful in acquiring ZS Pharma could well start a bidding war for Relypsa.

The market for the treatment of hyperkalemia is huge given the addressable patient population of about 3 million in the U.S. Veltassa is the first new drug to be approved in the U.S. to treat hyperkalemia in more than 50 years.

While Relypsa has limited competition and huge target market potential on its side, the big question is will a deal materialize before May 26 when the FDA is expected to decide on the fate of AstraZeneca’s ZS-9. Potential suitors could well decide to wait for this regulatory decision before approaching Relypsa. If ZS-9 is approved with a better label, then it could very well have an edge over Veltassa which comes with a black box label that tells patients to avoid taking any other oral medications within 6 hours of taking Veltassa.


Stay Ahead of Everyone Else

Get The Latest Stock News Alerts