Celldex Trying To Regroup With Its Early-Stage Assets

It was clear back in April that Celldex Therapeutics (CLDX) would be restructuring and realigning its priorities after the failure of its Phase III METRIC study of glembatumumab ("glemba") in triple-negative breast cancer, and after the first quarter earnings report, investors have a clearer picture of management's near-term plan.

Unfortunately, this new plan is still relying on assets that have either shown lackluster initial signs of efficacy (varlilumab or "varli") or are in very early stages of development. Assigning more than 10% odds of success to any of these programs based on the data seen to-date requires a leap of faith, but the good news (if you can call it that) is that the Street isn't assigning them much more value than that.

At this point, it really is about the data and management's ability to pull a rabbit out of its hat. Should the varli combo studies, or one of its other current clinical programs, show strong efficacy sufficient to support more robust odds of approval, the shares will likely react strongly and Celldex will be able to raise more cash on better terms. That's a long shot, and Celldex's poor drug development history shouldn't be ignored, but Celldex does at least still have multiple shots on goal and enough cash to get them at least to the point of early-stage data in human studies.

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Celldex Trying To Regroup With Its Early-Stage Assets

Celldex Could Really Use Some Strong Data

Celldex Therapeutics (NASDAQ:CLDX) is still back on its heels after the deeply disappointing announcement earlier this year that the company's lead compound failed an interim futility analysis. While the company does have a deep pipeline of other immuno-oncology and oncology antibody-drug conjugate (or ADCs) candidates, the reality is that much of this pipeline is early-stage and the field is both brutally competitive and witheringly difficult.

Given the data that have come out on the company's pipeline candidates since my last update, as well as data from potentially competitive therapies, I'm not as bullish as I was before. I still think that Celldex is undervalued, but I'm more concerned about how glembatumumab (or "glemba") will perform in the real-world market, and I'm concerned that key pipeline IO drugs like varlilumab and CDX-1401/CDX-301 may not be effective enough to become major contributors.

Sifting through early-stage data demands a lot of "could's," "seems," and "may be's," so I don't exclude the possibility that additional studies will show greater benefit. Likewise, I think it's fair to say that Celldex is deep in Wall Street's doghouse and probably has a higher burden of proof now. All that said, while I do think Celldex should sport a double-digit fair value, I feel like the arrow is pointing the wrong way in terms of recent clinical trial releases.

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Celldex Could Really Use Some Strong Data

Seeking Alpha: Celldex Therapeutics Still Looks Undervalued With Multiple Clinical Shots On Goal

Immunotherapy biotech Celldex Therapeutics (NASDAQ:CLDX) has continued to do well in a hot market for biotech, and an especially hot market for oncology immunotherapy companies. The shares are up another third or so over the last six months, as the company has continued to post encouragingly strong data from its studies of Rintega in glioblastoma multiforme (or GBM) and sign up partners for its t-cell co-stimulator varlilumab.

Rintega now represents about one-third of my estimated value for Celldex, with gemba making up closer to half. Varlilumab contributes relatively little today, but that could change significantly over the next year as early data from combo studies are expected. Combination therapy is likely to be the defining characteristic of immuno-oncology and with a broad (albeit early-stage) pipeline of IO assets, I believe Celldex is attractively positioned as a go-it-alone partner of choice or an M&A target for a larger pharma/biotech company that is lacking in homegrown IO candidates.

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Celldex Therapeutics Still Looks Undervalued With Multiple Clinical Shots On Goal

Seeking Alpha: Celldex Therapeutics Still Building Its Immuno-Oncology Story

Enthusiasm for immuno-oncology hasn't waned, and why should it? Companies like Bristol-Myers (NYSE:BMY), Merck (NYSE:MRK), and Roche (OTCQX:RHHBY) have been producing clinical data from immuno-oncology drug trials showing real improvements in response rates and survival in a range of hard-to-treat cancer types. Although Celldex (NASDAQ:CLDX) doesn't have the flavor-of-the-moment focus on CAR-T therapies, I would argue that the company's collection of vaccines, ADCs, and targeted antibodies is well worth a closer look from biotech investors.

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Celldex Therapeutics Still Building Its Immuno-Oncology Story

Seeking Alpha: A Sharp Pullback In Celldex Could Be A Window Of Opportunity

To buy when others seemingly can't sell fast enough takes a lot of guts (and other less family-friendly attributes), but it can be one of the best ways to exploit Wall Street shortsightedness. Small-cap oncology immunotherapy biotech Celldex (CLDX) has gotten swept up in this biotech bubble-popping, even though the data from the company has generally been positive and supportive of the idea that this company has some promising high-potential drugs.

On a risk-adjusted basis, I calculate a fair value of $29 per share for Celldex, suggesting significant upside from today's level. Readers have to consider two key risks here. First, there is the ever-present biotech risk that Celldex's drugs will fail in advanced clinical studies and never make it to market. Second, there is a growing risk that investors are cycling out of biotech and may no longer be willing to use the same long-term revenue multiples and discount rates. A true rout in the biotech space could take these shares down another 50% without any bad news from the company, but investors who can stomach that risk as the price of admission to a potential winner should look further into this story.

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A Sharp Pullback In Celldex Could Be A Window Of Opportunity

The Motley Fool: Cancer Vaccines: Doomed to Fail?

Some ideas sound good in theory but just never manage to work out in real-world experience, and cancer vaccines are on their way to that destination. Following the failures of Vical and Merck KGaA with their respective cancer vaccines, GlaxoSmithKline (NYSE: GSK  ) has announced the second pivotal trial failure for its MAGE-A3 cancer vaccine. Glaxo will continue to try to identify patient sub-populations in both melanoma and lung cancer that could/do respond to a clinically significant degree, but the odds are good that this high-risk/high-reward program is on its last legs.

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Cancer Vaccines: Doomed to Fail?

The Motley Fool: Celldex Uses the Immunotherapy Boom to Build Its War Chest

One of the most important mantras for any pre-revenue biotech company is to raise money when you can, not just when you need it. Celldex Therapeutics (NASDAQ: CLDX  ) is following that advice, leveraging the ongoing biotech bull market and the boom in interest for cancer immunotherapies to raise another $171 million in cash.

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Celldex Uses the Immunotherapy Boom to Build Its War Chest

The Motley Fool: Does Sanofi Need to Turn to M&A to Bulk Up Its Oncology Assets?

It's hard to say that there's anything particularly wrong with Sanofi (NYSE: SNY  ) today. Like most of its big pharma peers, revenue growth remains a challenge (sales were down 7% as reported in the third quarter and up less than 1% in constant currency), and investors are worried that generics, biosimilars in this case, will chew into Sanofi's lucrative diabetes franchise. Even so, the shares are near an all-time high, and investors who've owned these shares for a few years aren't exactly hurting.

Even so, one of the pillars of the bear thesis is that Sanofi hasn't done enough to position itself in some of the more attractive markets within branded pharmaceuticals. Sanofi's deal with Regeneron for its anti-PCSK9 antibody was a pretty good deal for Regeneron, and Genzyme's rare disease drugs contribute less than 10% of the total revenue base.

Most specifically, though, Sanofi is weak in arguably the hottest area in pharma: oncology. Given recent pipeline failures and weak positioning in immunotherapies, it's worth asking if Sanofi may turn to M&A to appease investors worried that Sanofi's fortresses in diabetes and vaccines and emerging opportunities in cholesterol and multiple sclerosis aren't enough.

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Does Sanofi Need to Turn to M&A to Bulk Up Its Oncology Assets?

Seeking Alpha: Celldex Turning Into A Compelling Immunotherapy Biotech

"Shoulda, coulda, woulda" will probably be my investing epitaph. While there is no shortage of investment advice telling you that long-term investment success is predicated on developing a consistent method of evaluating stocks and sticking to your valuation guns, the consequences can be painful.

A perfect case in point is Celldex Therapeutics (CLDX). I've always liked this development-stage biotech (and have written about it here and here...), but the price never seemed quite right to me. That "price discipline" has kept me on the sidelines as the stock has risen over 250% over the past year and 400% over the past two years, and the company has emerged as one of the most legitimate and interesting small/mid-cap immunotherapy biotechs.

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Celldex Turning Into A Compelling Immunotherapy Biotech

Seeking Alpha: Is ImmunoGen More Than T-DM1?

One of the crueler aspects of biotech is that investors can be right about a technology or drug, but still not make much money from it. Bad deals, bad management, and mismanaged expectations can sometimes do harm that even blockbuster drugs can't fix. While I don't think any of that applies to ImmunoGen (IMGN), I do wonder how much value lies in this company's Targeted Antibody Payload (TAP) technology (basically the company's own antibody drug conjugate approach).

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Is ImmunoGen More Than T-DM1?

Seeking Alpha: Is Biotech Getting Too Frothy? Investor Sentiment Suggests Irrational Exuberance

Investors with many years of experience in biotech know there's something to the idea that the best time to prepare for war is during peace (and vice versa). With the biotech sector heading for its second straight year of strong returns, it's worth asking whether investors are getting a little too cavalier about risk and whether investors in the sector are getting set up for a sizable correction.

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Is Biotech Getting Too Frothy? Investor Sentiment Suggests Irrational Exuberance

Seeking Alpha: Catching Up With Celldex Therapeutics

As a financial writer, sometimes you get lucky. That proved to be the case when I wrote about Celldex Therapeutics (CLDX) in January of this year - right before the shares spiked on new-found optimism for the company's innovative oncology program. Since then, the company has reported encouraging (albeit confusing) clinical data and bounced around between $4 and $5.50. Although investors should not underestimate the risks to this story, these shares still look like an under-appreciated play on some very difficult-to-treat cancer types.

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Catching Up With Celldex Therapeutics

Seeking Alpha: Celldex Therapeutics - A Potential Triple With Data On The Way

Investors are not exactly suffering for a lack of choice in oncology-related drug and biotech plays. From giants like Roche (Nasdaq: RHHBY.PK) to pure-plays like Celgene (Nasdaq: CELG) and emerging names like Medivation (Nasdaq: MDVN) or Seattle Genetics (Nasdaq: SGEN), investors could spend all day reading up on companies focused on developing drugs for the multi-billion-dollar oncology market.

Amidst all that interest, Celldex Therapeutics (Nasdaq: CLDX) has to some degree fallen into the cracks and gone unheralded. With a Phase 3 drug for brain cancer, a potential Phase 3 candidate in breast cancer, and a relatively deep pipeline, it would seem that Celldex deserves more than a sub-$100 million enterprise value. Surely there are risks and tribulations ahead, but risk-tolerant investors may want to consider these shares before trial data and partnerships move the stock from these levels.

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Celldex Therapeutics: A Potential Triple With Data On The Way

Maybe It's Time To Abandon Amylin

Dear Amylin,

We've been together a long time and, hey, you were great. But I think it might be time for us to see other people. No, it's not me, it's you.

...

The Latest Problem...
Okay, today's stock reaction to the Duration-6 study is probably overblown, but clearly Amylin (Nasdaq: AMLN) has some serious issues. This latest study basically demonstrated that Amylin's weekly drug Bydureon is less effective in controlling diabetes than a rival daily drug from Novo Nordisk (NYSE: NVO) called Victoza.

Designed to show non-inferiority, the study instead showed that Victoza lowered HbA1c by 1.5%, while Bydureon lowered it by 1.3%. That's not a huge difference, but it is still significant and you can rest assured that Novo Nordisk will market the hell out of it if or when Bydureon is approved. On a somewhat more positive note, Bydureon did show half of the side-effects of Victoza (nausea, diarrhea, and vomiting are common side effects for this class of drugs).

Now that's good (and part of the point of the study was to show a better side effect profile for Bydureon), but there did not appear to be any meaningful difference in drop-out rates, so the side effects of Victoza weren't enough to make its users quit in greater numbers.

Unfortunately, this could have some long-tail effects for Amylin (as well as Lilly (NYSE: LLY) and Alkermes (Nasdaq: ALKS). The FDA is very focused on risk-benefit these days and if Bydureon shows any hint of safety issues (and one could argue there have already been more than hints), the FDA may continue to refuse approval on the basis of Victoza being safer *and* more efficacious (even if less convenient for patients).

What Now?
So, what do I do with Amylin shares? I think this study clips the total market potential for Byrdureon, probably by $300-$500M. So, it could still be a $1B+ drug, but probably not much more than that. Working that all through my model moves the target price down to about $12 - higher than where it's currently trading as I write, but not enough to excite me.

Making matters all the worse, I once had a big gain here. This stock was a big performer a while ago (in the $50s) and I wondered at the time whether I should haven't sold at least half my position and let the rest ride. But oh no, I had to get greedy ... and I paid for it.

Anyways, now I need to figure out what to do. I could hold on and hope for the best, but that's not really a "strategy". I'm also seriously considering selling it and doubling up on Lexicon (Nasdaq: LXRX), another biotech I own that is arguably much more promising at present. A third option is just to go buy another biotech (Ziopharm (Nasdaq: ZIOP)? Celldex (Nasdaq: CLDX))? Luckily, I don't own much and it was never a huge part of the portfolio, so this whole debate is more about a bruised ego than a bruised wallet.

I would probably SELL Amylin ... unless you're really, really patient

Disclosure: I own shares of Amylin and Lexicon

Pfizer's Decision Leaves Celldex Reeling

Apparently the cancer vaccine honeymoon is over. Despite what looked like promising early-stage clinical data, Pfizer (NYSE:PFE) has decided to end its collaboration with Celldex Therapeutics (Nasdaq:CLDX) for the anti-cancer immunotherapeutic CDX-110.

While it is not unusual for small oncology-focused biotechs to trade down after the annual ASCO meeting - the most important oncology-related medical conference on the calendar - Celldex has done a bit worse than most. There had been fears that Pfizer's commitment was something less than complete, but Friday's announcement walloped Celldex's stock.  

Where Does Celldex Go From Here?
Celldex is putting on a brave face for its shareholders. The company is vowing to continue developing the product on its own, presumably with an eye toward striking another deal with a larger pharmaceutical company somewhere down the road. Sometimes this works out - there are examples where a partner has dropped out and the drug still ultimately makes it to market. Unfortunately, companies like GenVec (Nasdaq:GNVC), Trubion (Nasdaq:TRBN) and Neurocrine Biosciences (Nasdaq:NBIX) have all found that the loss of Pfizer as a partner is not a good sign for the drug involved.  

To read the full piece, please go to:
http://stocks.investopedia.com/stock-analysis/2010/Pfizers-Decision-Leaves-Celldex-Reeling-PFE-CLDX-GNVC-TRBN-NBIX0907.aspx

Cancer Vaccines Continue To Show Promise

I have to applaud the patience and diligence of the folks running Dendreon (Nasdaq:DNDN). After years of setbacks and complications (including three Phase 3 studies), the company and its investors finally saw the big payoff as the FDA approved the first-ever cancer vaccine - Provenge. 

With Provenge now on the market, and the squabbling and speculating about reimbursement fully underway, the question moves to who might be next to advance a cancer vaccine to the market. Is this really a major new avenue of oncology, or is it a small access road along the bigger highway of traditional drugs? 


For the complete column, please go to:
http://stocks.investopedia.com/stock-analysis/2010/Cancer-Vaccines-Continue-To-Show-Promise-DNDN-SNY-GSK-VICL-CLDX-PFE-GERN0707.aspx

A Big Deal For Biotechs - ASCO

One of the major biotech events of the year is fast approaching. The annual meeting of the American Society of Clinical Oncology (ASCO) will take place in Chicago from June 4 to June 8, 2010. This event is like Woodstock for biotechnology - if Woodstock were clean, air-conditioned and had plenty of restrooms. If you invest in biotechs or pharmaceuticals that want to play in the huge and well-reimbursed world of oncology, this is one of the major events of the year. 

Ahead of the meeting, ASCO releases a list of abstracts that scientists and companies will present. In some cases, these abstracts give away at least most of the story (efficacy, safety, etc.), while other abstracts are embargoed until the meeting itself. In any case, investors can still look forward to follow-up data (abstracts are submitted well ahead of the meeting) and oftentimes the amount of attention garnered by a presentation reflects overall interest in the compound.

Here we present some of the companies presenting abstracts at ASCO. 

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http://stocks.investopedia.com/stock-analysis/2010/A-Big-Deal-For-Biotechs---ASCO-AMGN-PFE-CLDX-PCYC-ITMN0526.aspx