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Monday, November 16, 2020
Pfizer shares drop as Moderna vaccine seen easier to distribute
Shares in Pfizer fell on Monday after rival drugmaker Moderna said its experimental vaccine against COVID-19 was 94.5% effective and that it can be stored at normal fridge temperatures.
Moderna is the second U.S. company to report encouraging trial results on a COVID-19 vaccine, joining Pfizer which has said its vaccine is also more than 90% effective.
But while Pfizer's vaccine has to be stored and shipped at ultra-cool temperatures, Moderna said its product can be kept at normal fridge temperatures.
"This is very important, perhaps a game changer," said Fawad Razaqzada, analyst at ThinkMarkets.
"The Pfizer vaccine had to be kept in very cold temperatures of minus 70 degrees Celsius, making it logistically difficult to produce and transport large doses of the vaccine," he said.
Pfizer shares, which on Nov. 9 hit their highest levels since end July 2019, fell 4.1% by 1623 GMT, while shares in its German partner BioNTech were down 12.8%.
JPMorgan analysts said the logistics of Moderna's vaccine were clearly less onerous although they expect storage requirements for both the vaccines to converge.
Moderna shares were up 9% after hitting a record high earlier on Monday, while shares in British drugmaker AstraZeneca, which is yet to release results from its late-stage vaccine trials, were down 0.9%.
Labs face COVID-19 surges, warn of test result delays as CMS pay cuts loom
- U.S. COVID-19 cases are reaching all-time highs this week and test volumes are nearing records, placing new pressures on diagnostics infrastructure, according to the American Clinical Laboratory Association.
- "The surge in demand for testing will mean that some members could reach or exceed their current testing capacities in the coming days," ACLA President Julie Khani laid out in a statement Thursday. "In cases where the number of specimens received exceeds an individual laboratory’s testing capacity, there could be an increase in their average time to deliver results."
- That warning comes a month and a half out from when CMS plans to begin reducing COVID-19 test payment to labs by 25% if they take longer than two days to return results.
While the ability of major U.S. lab networks to quickly turn around coronavirus test results — key to the usefulness of those results for contact tracing, physical isolation decisions and other mitigation measures — has shown improvement in recent months, there is concern that they might again suffer significant delays.
At certain points in July, for instance, Quest Diagnostics' average time to results was more than a week, and LabCorp's was up to six days.
Fast forward a few months: Quest reported that as of Nov. 9, its average turnaround time for molecular diagnostic testing is two days across all populations and one to two days for "priority" tests, including for hospitalized patients, presurgical patients and people in nursing homes. And LabCorp's most up-to-date report said it was averaging one day to results during the week ended Nov. 1.
With the U.S. now facing a staggering acceleration of confirmed cases, those times may be poised to go back up. Increased turnaround times could spell trouble for labs if they persist. CMS announced Oct. 15 it would reduce its COVID-19 test pay by 25% in cases when a lab takes longer than two days to deliver results, effective Jan. 1.
In the month since CMS made the announcement, the U.S. has seen a dramatic uptick in positive cases while also increasing the number of tests performed daily. An update Thursday from The COVID Tracking Project said one in every 378 U.S. residents tested positive for COVID-19 this week.
The updated payment policy will kick in Jan. 1, right after the holidays — a period public health experts are concerned will spread the virus as more people travel and attend family gatherings.
Still, the 25% reduction to $75 is off a previously increased payment rate. The Trump administration in April threw its weight behind high-throughput technologies, with CMS announcing it would double the payment rate for tests run on the more efficient machines from $51 to $100.
Labs will still be eligible for $100 payments if they complete a high-throughput test, reporting the results in two calendar days or less. They will also be eligible if, within the previous month, they complete the majority of their COVID-19 tests using high-throughput technology in two calendar days or less for all individuals tested, not just those covered under Medicare.
At least in the lead-up to this fall, revenue appeared to be booming for big lab networks like Quest and LabCorp. For the third quarter, Quest reported a nearly 43% year-over-year revenue increase to nearly $2.8 billion and LabCorp saw a 33% rise to $3.9 billion. Those spikes came from COVID-19 gains, given that their base businesses were still recovering from a significant drop in routine test volumes during the pandemic.
Supply chain constraints remain a key hindrance for labs, with ACLA's Khani calling out delays and cancelations on orders for critical materials like pipette tips. The current case surge also reduces efficacy of strategies once heralded for conserving resources.
"[S]pecimen pooling, one of the many techniques labs have developed to more efficiently use supplies and increase capacity, is only applicable for populations at low risk or with low prevalence of infection, and is therefore currently limited due to increased positivity rates in communities across the country," Khani said in Thursday's statement.
Dialysis device maker Outset Medical tops revenue target
Outset Medical reported its third-quarter revenue grew 423% to nearly $13.8 million during its earnings call Wednesday afternoon, its first since going public.
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The portable dialysis system company benefited from the pandemic environment, which is driving increased interest in home dialysis and growth in its base business. With the COVID-19 tailwind fading, Outset Medical expects sales to be flat sequentially in the fourth quarter.
- The results report comes shortly after CMS formally rejected its request for an add-on payment. In response, Outset Medical is considering re-applying in 2021 or 2022.
Outset Medical, whose portable Tablo system has FDA clearance for use at home or in acute or chronic care facilities, went public in September. It netted $255 million to support the expansion of its sales and support organization while investing in R&D. The stock soared when it began trading, more than doubling from the $27 IPO price before settling down around the $45 point.
The third quarter results provide an early look at whether Outset is on track to justify the interest shown by investors. Sales rose 423%, albeit from a low base of $2.6 million, due to increases in both product and service revenues. With spending on R&D and sales and marketing rising, Outset posted a gross loss of $5.1 million, compared to a gross loss of $5.3 million one year ago.
Outset shared indications it can continue to grow on its third quarter results conference call. In the quarter, Outset signed contacts with three new national customers and three regional health systems, setting it up to work with six of the largest health systems in the country. Those contracts can support further growth of Outset’s Tablo device.
“They'll start with a smaller number of hospitals in their network, integrating Tablo and quantifying the cost reduction impact [and] how easy it is for them to train their own nurses to deliver dialysis. Once that data has been established, we've seen their next step pretty quickly to be spreading that model across perhaps a division or a group of hospitals and then fairly quickly over time network-wide,” Outset CEO Leslie Trigg said on Wednesday's earnings call.
The cadence of expansion allows opportunities to grow sales from existing customers while working to sign up additional healthcare systems. The company is targeting the top 50 regional health systems. Having signed up “over a dozen of them,” Trigg sees a “very long runway” for the company.
Analysts at SVB Leerink see Outset targeting the acute market in the near term, per a note to investors.
"In the mid- to long-term, we see Tablo potentially driving a paradigm shift to home hemodialysis (HHD) from in-center dialysis – something that the broader market has anticipated for some time and that now seems much closer to reality given the upcoming Advancing American Kidney Health Initiative."
Securing Transitional Add-on Payment Adjustment for New and Innovative Equipment and Supplies (TPNIES) from CMS could have boosted Outset’s efforts to grow the business. Trigg said the add-on payment would be a tailwind, leading Outset Medical to consider reapplying, but framed the overall CMS’ proposed rule as a positive despite the rejection of its TPNIES application.
"The question was whether they would include capital equipment in the TPNIES eligibility criteria. And what came out in the final rule is that, yes, capital equipment is included. We were hoping this would be the outcome and obviously we're pleased to see the allowance for this kind of capital,” Trigg said.
If Outset Medical successfully reapplies, it will be a tailwind, Trigg said, but the company is not reliant on the add-on payment for growth. Rather, Outset Medical is continuing to push its messaging around cost reduction and operating efficiency as it tries to claim slices of the acute and home care settings from Fresenius and Baxter.
Gilead and Novo plot next steps after trial data from NASH combo
Gilead and Novo Nordisk have announced their drug combinations for the fatty liver disease known as NASH checked out in a mid-stage proof-of-concept study.
The companies said the trial met its primary safety goal in people with non-alcoholic steatohepatitis (NASH) but stopped short of announcing any further plans for clinical development.
Instead they are “carefully evaluating next steps based on a thorough assessment of data,” according to Novo Nordisk’s senior vice president of global development, Martin Holst Lange.
The five-arm trial tested combinations of Novo’s semaglutide GLP-1 agonist, in various combinations with two Gilead pipeline drugs: the FXR agonist cilofexor and the investigational ACC inhibitor firsocostat.
Semaglutide is the active ingredient in Novo’s weekly injection Ozempic and its daily pill Rybelsus, which are both approved to treat type 2 diabetes.
Results of the 24-week trial involving 108 people with NASH were presented at The Liver Meeting Digital Experience over the weekend.
The trial met its primary endpoint by demonstrating that in people with NASH and mild to moderate fibrosis, all regimens were well tolerated.
The most common adverse events (AEs) were gastrointestinal. Minimal pruritus (itching) was observed in people treated with cilofexor.
Across all groups, 5–14% of people discontinued any trial treatment due to AEs.
Exploratory efficacy endpoints assessing biomarkers of liver health at 24 weeks in post-hoc analyses showed statistically significant improvements in liver fat levels and liver injury in the combination arms versus semaglutide alone.
Although liver stiffness measured and enhanced liver fibrosis score declined in all groups, statistically significant differences between groups were not observed.
Gilead and Novo are among a group of companies searching for therapies for NASH, which has for years been predicted to be a source of billions of dollars in revenue for big pharma.
But finding a drug that works against the disease has proved tricky: the FDA rejected Intercept Pharmaceuticals’ FXR agonist obeticholic acid in NASH in July after deciding its benefits would not outweigh its risks.
Although the REGENERATE study showed obeticholic acid increased the likelihood of at least a one-stage improvement in fibrosis without worsening of NASH, it failed to meet another endpoint of improvement in NASH without worsening fibrosis.
Gilead added frisocostat and cilofexor to its pipeline after acquiring them from Nimbus Therapeutics and Phenex Pharmaceuticals, respectively.
The California biotech’s other big hope in NASH selonsertib is yet to produce convincing results in late stage clinical trials.
J&J, erring on caution, tests new 2-dose regimen for COVID-19 vaccine
Johnson & Johnson is confident that it has a one-dose knockout vaccine that can protect against COVID-19, but it’s now starting a late-stage two-dose test just in case.
The Big Pharma’s vaccine, Ad26.COV2.S (now also known as JNJ-78436735), is currently in a major 60,000-subject phase 3 known as ENSEMBLE assessing whether it can stop COVID-19 infections with a single shot.
Early data have already shown it can produce an immune response at one dose, but now it wants to test out a two-dose schedule.
This will be done under the phase 3 ENSEMBLE 2 program, made up of 30,000 patients and running parallel to its ongoing ENSEMBLE phase 3.
If it’s already running a one-shot-and-done program, which puts it at an advantage over rivals Pfizer/BioNTech and Moderna, which need two, why spend the time and money doing a multidose test?
“While a potentially safe and effective single-dose preventive COVID-19 vaccine would have significant benefits, particularly in a pandemic setting, Janssen’s COVID-19 vaccine program has been designed to be extremely thorough and driven by science. As such, we are investigating multiple doses and dosing regimens to evaluate their long-term efficacy,” the U.S. Pharma said in a statement.
The test is being kick-started today and breaks down as a randomized, double-blind, placebo-controlled trial set up to see it evaluate safety and efficacy in a two-dose vaccine regimen versus placebo. Recruitment should be done by March 2021, and the trial will last for a year.
The test is focused on adults with and without comorbidities associated with an increased risk for severe COVID-19. The second dose will come 57 days later, much longer than the current two-dose regiments of its rivals, which are typically giving two within a 28-day period.
This also comes as J&J said that the Biomedical Advanced Research and Development Authority, which has already kicked in $1.4 billion for Janssen’s COVID-19 work, is adding an extra $454 million, with J&J throwing in $604 million, for the ENSEMBLE phase 3.
Like AstraZeneca/University of Oxford, J&J is a part of Operation Warp Speed, the U.S. government's effort to deliver 100 million doses of a viable COVID-19 vaccine by January 2021. And that's not all they have in common—both are developing adenovirus-based vaccines, unlike Warp Speed peers Pfizer/BioNTech and Moderna, which are working on mRNA-based jabs.
Both have also been hit by safety worries after several patients fell ill across their trials, leading to trial halts, though these have now been both resolved.
Pfizer and BioNTech recently announced, via a press release, that their mRNA vaccine could produce a 90%-plus efficacy, although we will have to wait and see the breakdown of the data to fully assess this claim. Moderna released its data today, topping Pfizer's efficacy with a 94.5% hit rate and apparently also able to stop severe disease.
Alterity OKd on US patent for nextgen compounds for neurodegenerative diseases
Alterity Therapeutics (ASX: ATH, NASDAQ: ATHE) ("Alterity" or "the Company") has today announced the allowance of a new composition of matter patent by the United States Patent and Trademark Office (USPTO). The new patent is the product of in-house discovery research and is central to Alterity's next generation drug development portfolio focussed on neurodegenerative diseases.
The patent, entitled "Compounds for and Methods of Treating Diseases" (Application No. 16/818,641), covers more than 150 novel pharmaceutical compositions that are designed to redistribute the labile iron implicated in Parkinson's disease, Alzheimer's disease and other neurodegenerative conditions. The patent, which was filed in March of 2020, underwent prioritized examination by the USPTO.
Alterity's strategy is based on the hypothesis that its therapeutics can disrupt the underlying pathology of neurodegenerative conditions in which labile iron is implicated in disease pathology. This includes Parkinsonian disorders such as Parkinson's disease and Multiple System Atrophy, as well as Alzheimer's disease.
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