FDA gearing up for rapid review of potential COVID-19 booster shots

 The U.S. Food and Drug Administration is planning a rapid review process for quick turnaround of new COVID-19 booster shots if variants of the coronavirus emerge against which the vaccines do not provide protection, the agency’s top official said on Thursday.

Dr. Janet Woodcock, acting commissioner of the FDA, said that if new variants of the coronavirus emerge that require booster shots or changes to vaccines, the agency will not require the type of large trials that were required for emergency use authorization or approval.

The agency plans to issue a proposal on the process for public comment in a few weeks, she said during a press briefing. That process will likely require safety information as well as, if possible, the convening of an outside committee of experts to review the booster shot.

Both Pfizer Inc and German partner BioNTech SE as well as Moderna Inc, whose vaccines have been authorized for emergency use in the United States, have said they are preparing for the possibility that variants will emerge that could require a booster shot.

The current vaccines still provide adequate protection against existing variants of concern, Woodcock said. A variant in the U.K. has been found to be more transmissible while some vaccines have been found to be less effective against variants that emerged in South Africa and Brazil.

Settling on a regulatory process will help the FDA move quickly if needed, she said.

“If the virus changes, we are getting prepared for that,” Woodcock said.

The threshold for deciding on whether a new vaccine is needed has not yet been determined. Countries must build surveillance measures to find variants of concerns, and then scientists must agree upon at what point a variant has strayed too far from the unaltered virus and requires a new vaccine.

https://www.reuters.com/article/us-health-coronavirus-usa-fda-idINKBN2A5086

Redditors Betting on a $600 Ligand Stock Short Squeeze

 Last week, Ligand Pharmaceuticals (NASDAQ:LGND) found itself at the center of unexpected attention. The second-most shorted company in the U.S. saw its shares rise from $120 to almost $200 as Reddit users sought the next GameStop (NYSE:GME) to squeeze.

Meanwhile, insiders have started to cash out. On Wednesday, CEO John Higgens allowed his 10b5-1 sales of employee stock options to move ahead, reversing the ESOP purchases he had made just weeks before.

As Ligand’s stock continues its relentless upward march, investors should pay close attention. The firm was one of the few highly shorted companies still available on the popular trading app Robinhood. And after trading in GameStop was halted, Redditors turned their attention to a new hedge-fund target, sending prices to $500 and beyond before they come back to earth.

LGND Stock: Don’t Get in the Way of an Angry Bull

Since falling from its $275 peak in 2018, Ligand Pharmaceuticals has been a favorite hedge fund punching bag. Andrew Left’s 2019 Citron Research paper drew parallels to Valeant Pharmaceuticals, another company run by former Wall Streeters. There are some similarities. Rather than invest in research and development, Ligand and Valeant rely on investment bankers to sniff out profitable M&A deals. Why take the development risks, the thought went, when you could choose promising Phase 1 drug candidates and buy them outright?

Mr. Left and other hedge funds weren’t impressed. Today, Ligand has a 62% short interest ratio. And if you remove non-floated shares, the figure rises to almost two-thirds; it would take fourteen days for short sellers to liquidate their positions.

And that’s caused quite a headache for short sellers in recent days.

Short Sellers Starting to Look Nervous

With the rise (and fall) of GameStop stock, short-sellers have suddenly realized the combined power of retail investors. And there are three reasons why Ligand short-sellers should panic. Firstly, unlike GameStop, Ligand’s biotech bets could potentially pay off. Many of Ligand’s biotech peers have bought what turned out to become $5+ billion drugs, and many of Ligand’s 55 pipeline drugs show similar potential.

Secondly, the company still sells for relatively cheap, even after its latest run-up. Though its recurring licensing revenues will decline from 2023 onwards, the company generated so much cash from its current lineup of drugs that its backward-looking PE ratio sits at just 5.0x. Its price-to-sales ratio of 22x remains only a hair above the 17x biotech sector median.

Finally, there’s the question of Reddit’s wrath. At $2.6 billion, Ligand stock is a minnow compared to the $33 billion that GameStop shares achieved. Even a small push from Redditors can cause short sellers to panic, sending shares from $200 to $600. An enormous 2018-styled short squeeze, meanwhile, could see Ligand hit the thousands.

Why Insiders Have Started Selling

Insiders haven’t always been so bearish on LGND stock. In November, director Patel Sunil bought 1,000 shares at $82. And insiders have also consistently used their employee stock options to load up on shares in the $80 to $90 range.

The stock’s recent rise changed all that. As stock options came due, executives allowed their 10b5-1 plans to exchange stock options for cash, selling shares anywhere from $159 to $182. The insiders have a good reason for taking profits. Not only are biotech executives generally rewarded by stock options. But the people who run Ligand are investment bankers. In other words, they know a good deal when they see one.

That leaves Redditors in an awkward position. Would they choose to support a company with investment banking management? Or would they say, “soak the rich” and bet against the hedge funds selling Ligand short?

What’s LGND Stock Worth?

Whatever the crowd decides, whether you invest in Ligand depends if you’re a long-term investor or a short-term speculator.

Reddit Fan: If you have a strong desire for short-term gains, then Ligand looks set to run even higher. The company is the most heavily shorted stock available for Robinhood investors to buy. And its options chain, a measure of bullish/bearish sentiment, points to more gains. As of writing, February calls are up almost 60% for the day. In addition, the company’s estimated fair value of $180 means there’s less risk of significant losses.

Long-Term Investor: If you’re interested in long-term potential, make sure you’re willing to stomach the short-term swings. And because Ligand’s pipeline remains in the “show me” stage, make sure you’re only investing a small portion of your portfolio in this hot stock. Though the company trades close to its fair value today, a series of disappointing Phase 3 trials will send its fair value back to $80 and below.

Buyer beware. At $180, Ligand still shows some splendid short-term potential. But even its management knows to tread lightly.

https://investorplace.com/2021/01/lgnd-stock-redditors-are-betting-on-600-ligand-short-squeeze/

Alphabet-backed Oscar Health files for IPO as telehealth market booms

 Oscar Health, a health insurance start-up backed by Google parent Alphabet Inc, filed for an initial public offering on Friday, looking to cash in on the surge in demand for digital health services during the COVID-19 pandemic.

The New York-based company, which has about 529,000 users, enables scheduling physician visits, checking lab results, emergency virtual appointments and prescription refill through its mobile app or online platform.

Oscar Health was founded in 2012 by Mario Schlosser, Kevin Nazemi, who is no longer a part of the company, and Josh Kushner, brother of former U.S. President Donald Trump’s adviser and son-in-law Jared Kushner.

The COVID-19 pandemic has supercharged the telemedicine market and more companies are looking to expand their scale and offerings as healthcare moves to the virtual realm.

Oscar Health’s stock market launch comes as U.S. capital markets are poised for another banner year, with January’s IPO haul totaling $33.9 billion, according to Refinitiv data.

The digital insurance startup said it would list its Class A common stock on the New York Stock Exchange under the symbol "OSCR". (bit.ly/39U4MdA)

The company’s other investors include venture capital firm General Catalyst Group, Fidelity Investments parent FMR LLC, Peter Thiel’s Founders Fund, investment firm Thrive Capital and Khosla Ventures.

Goldman Sachs & Co. LLC, Morgan Stanley and Allen & Company LLC are lead underwriters for the offering.

https://www.reuters.com/article/us-oscar-health-ipo/alphabet-backed-oscar-health-files-for-ipo-as-telehealth-market-booms-idUSKBN2A52U8

Cassava: Alzheimer’s Study Results Are Promising but It’s Early Days, Says Analyst

 The effect clinical trial results can have on a pharma company’s stock are tremendous and can work both ways. Disappoint investors and a sharp descent for the shares is likely. Conversely, release encouraging news, and the sky’s the limit.

It is safe to say that in the case of Cassava Sciences (SAVA), investors were very happy following its latest news release.

Cassava shares are up nearly 210% (at one point, the stock was up over 490%) this week, after the company disclosed encouraging interim data from an open-label study of its Alzheimer’s disease candidate simufilam.

The study, which was funded by the National Institutes of Health (NIH), found that six months after treatment began, 50 Alzheimer's disease patients exhibited a 10% improvement in their cognitive functions. Furthermore, dementia-related behavior, such as delusions, anxiety, and agitation, also improved by 29%.

The company is now in talks with the FDA about a Phase 3 trial, which is anticipated to kick off in 2H 2021.

Alzheimer's is a progressive disease, which over time causes sufferers’ cognitive abilities to decline. Therefore, the results are even more eye-catching.

In the U.S. alone, almost 6 million people suffer from the memory-obliterating disease, and there are presently no available drugs that can stem its progress. Accordingly, a successful treatment could be very lucrative.

So, it is no wonder the market’s reaction to the data was so upbeat. However, Cantor analyst Charles Duncan takes a more measured view.

“Although we find these data provocative and encouraging, we interpret the observations with caution, as it is an open-label study that can be confounded by variables, such as expectation bias,” the 5-star analyst said. "With long-term dosing there may be notable dose-dependent differences or, perhaps, a safety signal that may advantage titration with the higher dose."

However, Duncan summed up, "these results do not alter our fundamental views and thesis, nor do they change the risk we associate with this program."

Duncan’s “fundamental view” says Cassava is an Overweight (i.e. Buy), and the rating is backed by a $24 price target. That said, the stock’s massive surge means the share price is now ~57% above Duncan’s figure. (To watch Duncan’s track record, click here)

Other analysts are in the same boat. While the 2 additional reviews are both Buys, the Strong Buy consensus rating comes with a $19.33 average price target attached. From current levels, it is a sharp ~69% drop. It will be interesting to see whether the analysts upgrade their price targets or downgrade their ratings over the coming months. (See SAVA stock analysis on TipRanks)

https://finance.yahoo.com/news/cassava-alzheimer-study-results-promising-153618638.html

Ocugen: New Potential Covid-19 Vaccine at the Gate

 It’s official, a new Covid-19 vaccine candidate has entered the fray.

On Tuesday, Ocugen (OCGN) announced it had finalized its deal with India-based Bharat Biotech. The two will work together on COVAXIN, Bharat’s Covid-19 vaccine, for the U.S. market.

Ocugen will take on all aspects of U.S. based responsibilities, including clinical development, regulatory approval, and commercialization. If the vaccine is granted an EUA, Bharat anticipates supplying the U.S. market’s initial COVAXIN doses.

Bharat, in return, will be eligible for 55% of U.S. sales’ profits, with Ocugen retaining the other 45%.

Ocugen gets a head start, as COVAXIN has already been granted emergency use authorization in India. It is also currently in a Phase 3 study with 25,800 subjects enrolled.

H.C. Wainwright analyst Swayampakula Ramakanth says the vaccine has qualities which set it apart from the competition.

“Compared to COVID-19 vaccines currently authorized under EUA, COVAXIN could induce more broad immunity targeting multiple viral proteins, potentially resulting in better protection against emerging mutant viruses, such as the UK and South African variants,” the 5-star analyst noted. “Additionally, COVAXIN only requires a standard vaccine storage temperature, compared to the more stringent storage requirements for the mRNA vaccines.”

The vaccine, therefore, “could strengthen the arsenal to fight against the pandemic.”

Ocugen is already in talks with the FDA and the Biomedical Advanced Research and Development Authority (BARDA) to map out the path forward to “a successful EUA.”

Given the dire need for Covid-19 vaccines, Ramakanth believes that should the Indian Phase 3 study display more than a 50% success rate, there’s a possibility the FDA could make an “unprecedented move” and grant COVAXIN EUA status.

“Therefore,” the analyst summed up, “We believe COVAXIN has the potential to deliver significant upside in the next 6-12 months.”

As a result, Ramakanth upgraded Ocugen’s rating from Neutral (i.e. Hold) to Buy with a $4.5 price target. The implication for investors? Upside of 60% for the coming year. (To watch Ramakanth’s track record, click here)

Ramakanth’s colleagues back up his call, as all 3 other recent Ocugen reviews say Buy. OCGH's Strong Buy consensus rating is backed by a $4.30 average price target, suggesting a ~30% premium will be added to the shares in the year ahead. (See OCGN stock analysis on TipRanks)

https://finance.yahoo.com/news/ocugen-potential-covid-19-vaccine-163624031.html

FDA Shrinks Scope of Convalescent Plasma For COVID-19

 The FDA limited the scope of authorized COVID-19 convalescent plasma use to a subset of hospitalized patients, in a revision issued on Thursday.

According to the updated emergency use authorization (EUA), only high-titer convalescent plasma should be used, and only for a narrower population: hospitalized patients early in disease course and those with impaired humoral immunity who cannot produce an adequate endogenous antibody response. Low-titer convalescent plasma is no longer authorized for use.

These recommendations were based on updated data from clinical trials, the FDA said, specifically citing research from the expanded access protocol from the Mayo Clinic, as well as other smaller trials.

Data from the Mayo Clinic trial was published in an August preprint, but not in a peer-reviewed journal until January. The journal publication indicated that higher-titer plasma was associated with a lower risk of death than lower-titer plasma, and patients receiving the treatment who were non-mechanically ventilated had a lower risk of death than those receiving mechanical ventilation.

"Based on assessment of these data, potential clinical benefit of transfusion of COVID-19 convalescent plasma in hospitalized patients with COVID-19 is associated with high titer units administered early in the course of disease," the agency wrote. "Transfusion of COVID-19 convalescent plasma in hospitalized patients late in the course of illness (e.g., following respiratory failure requiring intubation and mechanical ventilation) has not been associated with clinical benefit."

A Fact Sheet for Providers has also been updated to include this information about lack of clinical benefit in intubated patients.

Controversy has always followed use of convalescent plasma for COVID-19, which was authorized in August a day after a tweet from President Trump to former FDA Commissioner Stephen Hahn, MD, nudging him about its authorization. Hahn was later forced to walk back certain claims he made about the treatment at a press conference, which had exaggerated the clinical benefit.

The EUA for convalescent plasma was revised at least once before. In November, the agency added a requirement for an additional test in convalescent plasma manufacture to qualify high-titer plasma. Nine tests are now authorized for this purpose, the FDA said.

https://www.medpagetoday.com/infectiousdisease/covid19/91071

Did Convalescent Plasma for COVID-19 Unleash Viral Mutation?

 An immunosuppressed patient with COVID-19 in England developed viral mutations last summer -- including one included in the notorious B.1.1.7 or "U.K. variant" -- after treatment with convalescent plasma, researchers found.

A man in his 70s, who had received immunotoxic chemotherapy in 2012 to treat lymphoma, was hospitalized with COVID-19 and treated with antibiotics, steroids, and remdesivir. However, following treatment with convalescent plasma in July, genomic sequencing revealed the patient acquired viral mutations, including a deletion present in the B.1.1.7 variant, reported Ravindra Gupta, MD, PhD, of University of Cambridge in England, and colleagues.

"We have documented a repeated evolutionary response by SARS-CoV-2 in the presence of antibody therapy during the course of a persistent infection in an immunocompromised host," the authors wrote in an unedited but peer-reviewed manuscript published in Nature.

The man died in late August. Gupta's group did not claim that he was the first to develop the B.1.1.7 mutation or that it spread from him to other people. Rather, they speculated that the plasma therapy had unleashed the resistant variants, and could do so in other immunosuppressed patients too.

In such patients, they wrote, "the antibodies administered [in plasma] have little support from cytotoxic T cells, thereby reducing chances of clearance and theoretically raising the potential for escape mutations."

Consequently, they cautioned against using convalescent plasma in severe COVID-19 patients and especially in those with compromised immune function.

"The data from this single case report might warrant caution in use of convalescent plasma in patients with immune suppression of both T cell and B cell arms," they wrote, suggesting it should only be used in immunosuppressed patients as part of observational studies with appropriate infection control precautions.

The FDA recently limited the scope of its emergency use authorization of convalescent plasma in COVID-19 patients to less severe patients, but did not suggest extra caution in immunosuppressed patients. In fact, the agency said, "The therapeutic window may be longer" when plasma is given to patients with "impaired humoral immunity."

In the British case, the man was initially hospitalized in May with neutropenic sepsis, and tested positive for SARS-CoV-2 about a week later. He was discharged later that month, but readmitted in late June with cough and breathlessness.

His clinical condition deteriorated and he received dexamethasone and two 10-day courses of remdesivir with 5 days in between. Convalescent plasma was administered on two days around July 20; more remdesivir and convalescent plasma was administered about 4 weeks later. He died shortly afterward.

Gupta -- who also documented the second case of HIV remission with the "London patient" in 2019 -- and colleagues collected viral samples from this patient 23 times. During the first 57 days, they found little change in viral population following treatment with remdesivir, but following the July round of convalescent plasma, there was a shift in viral genotype.

Initially the patient's viral serotype showed a mutation first reported in China (a D614G substitution in the spike protein). However, that changed in late July, when a variant with two alterations in the spike protein, including the deletion seen in the B.1.1.7 variant, became prevalent.

Experimental analyses found "two-fold reduced susceptibility of these viruses to convalescent plasma containing polyclonal antibodies," though the researchers said it was not the reason for the ultimate treatment failure.

Gupta and colleagues said this viral evolution is unlikely to occur in immunocompetent patients, as "viral diversity is likely to be lower due to better immune control."

However, they questioned CDC guidance recommending 20 days for afebrile immunocompromised patients as the upper limit of infection prevention, noting they detected "environmental contamination" in a single occupancy room, so the patient was moved to a negative-pressure isolation room.

Limitations to the study included that it was a single case, and samples were taken from the upper respiratory tract, not the lower tract.

Disclosures

The authors disclosed no conflicts of interest.

Primary Source

Nature

Source Reference: Kemp SA, et al "SARS-CoV-2 evolution during treatment of chronic infection" Nature 2021; DOI: 10.1038/s41586-021-03291-y.

https://www.medpagetoday.com/infectiousdisease/covid19/91088