Healthcare analysts expressed their views on drug makers Celldex Therapeutics, Inc. (NASDAQ:CLDX) and Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA), following favorable clinical data of cancer treatments from each. Both analysts believe the data represents a catalyst for the stock, marked by a positive safety profile for Celldex’s drug and projected success of ARIA’s pipeline, supported by the most recent study.
Celldex Therapeutics, Inc.
Boris Peaker, a biotech analyst with Cowen & Co, explains his views on CLDX following phase 1 data evaluating Valilumab, the company’s t-cell agonist, in combination with nivolumab, an anti-PD 1 antibody. The data indicated that the “combination regiment was very well-tolerated” with most patients reporting common side effects such as fatigue and nausea. The analyst notes that only a small handful reported more adverse side effects. He states, “The safety profile should not be underappreciated, as this is one of the first studies to combine an immune checkpoint agonist on top of an anti-PD-1.” The analyst compares these results to similar studies with respect to the safety profile. He states, “Considering that 51% of patients treated with nivo/ipi experience grade 3/4 [adverse effects], we think this initial safety profile is very favorable.”
Peaker also notes that according to the study, “multiple measures indicated robust immune activation,” such as high levels of serum chemokines and decreasing T-regs. The analyst elaborates, “In patients with pre-treatment and on study biopsies, many demonstrated an increase in tumor infiltrating lymphocytes and appeared to correlate with response (SD or better). Additionally, a notable increase in PD-L1 expressing tumor cells was observed and also correlated with stable disease or better response.”
The company is currently enrolling patients in the phase 2 portion of the trial. Although the company did not release detailed response data from the Phase 1 trial, the analyst believes “the safety profile bodes well for the currently enrolling Phase II portion.”
The analyst reiterated an Outperform rating on the company with a $12 price target.
According to TipRanks, Boris Peaker has a 48% success rate with an average return of 15% per recommendation.
Ariad Pharmaceuticals, Inc.
JMP analyst Michael King provided his insights on ARIAD pharmaceuticals following the presentation up updated phase 1/11 clinical data on brigatinb, an investigational cancer medicine targeting those with anaplastic lymphoma kinase positive (ALK+) and non-small cell cancer (NSCLC) whose disease is resistant to crizotinib. The data indicated that “Brigatinib demonstrates robust anti-tumor activity in ALK+ NSCLC patients.” The analyst highlights that most of the 70 evaluable patients in the study previous treated with crizotinib therapy “demonstrated tumor shrinkage” and 25 of those had a complete response.
The analyst believes brigatinib’s 13.4 month progressive survival rate is “impressive and indicative of the drug’s competitive profile in this crowded space.” He continues, “The projected 100% one- and two-year survival in the treatment naïve setting is also impressive, as is the one- and two-year OS projections of 81% and 71%, respectively, in the crizotinib-experienced setting.”
King believes Iclusig, the company’s FDA-approved leukemia treatment, will generate impressive revenue going forward, supported by positive brigatinib pipeline data. He states, “We anticipate continued commercial success as the Iclusig market expands and the ARIA pipeline also continues to grow. Iclusig should produce worldwide revenue of $195MM during FY16, while brigatinib and third pipeline candidate, AP32788, produce value-driving data.”
The analyst reiterated a Market Outperform rating on the company with a $9 price target.
According to TipRanks, Michael King has a 50% success rate recommending stocks with an average loss of (3.2)% per recommendation. Out of the 3 analysts who have rated the company in the past 3 months, 1 gave a Sell rating while 2 remain on the sidelines. The average 12-month price target for the stock is $6.17, marking a 14% downside from where shares last closed.