This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Biotech Stock Mailbag: Vical, Sangamo, Spectrum Pharma

Stock quotes in this article: VICL, SGMO, SPPI

2. The buzz in melanoma therapy today and at the upcoming American Society of Clinical Oncology (ASCO) annual meeting is about new PD-1 and PDL-1 drugs from Bristol-Myers, Roche and Merck. What are melanoma experts and institutional healthcare investors saying about Allovectin? Crickets....Silence and dis-interest is not what you want heading into pivotal trial results.

Moving on.

In early March, I wrote a column calling Sangamo BioSciences' (SGMO) HIV gene therapy SB-728 a valuation prop. In the column, I argued that this "functional cure" for HIV is more hype than reality, but it's also the only drug Sangamo has in the clinic. Without SB-278, the company would be hard-pressed to maintain its $500 million market value.

Fast forward two and a half months and Sangamo's stock price is down 20% in a raging biotech bull market.

Sangamo presented some new data on SB-278 Wednesday, described as "remarkable" by the company's chief medical officer. The market appears to disagree, and for good reason. The graph below is from an HIV patient described as a responder to SB-278:

Pay attention to the black line, which represents the viral load, or the amount of HIV in the patient's system. At the start of the study, the patient's viral load is so low it's undetectable. That's because the patient is taking anti-retroviral therapy, or ART. These are the drugs that Gilead Sciences (GILD) is famous for. Right around 60 days, the patient stops taking ART. Almost immediately, his viral load shoots up. Now, it does fall a little during the ART interruption period, which is why Sangamo calls this patient a responder, but viral load never gets back to undetectable. Not even close. Once the patient resume ART, his viral load drops quickly to undetectable.

Whew! I wouldn't call this slide a "remarkable" indication of SB-278 efficacy, as Sangamo suggests. Instead, I'd say this slide screams, "THANK GOD FOR ANTI-RETROVIRAL THERAPY!"

Next. I tweeted this Wednesday night about Spectrum Pharmaceuticals (SPPI):

Insane, I know, which is why I received some responses like these:

All jokes aside, the belinostat data released Wednesday night as part of the ASCO abstract dump do compare favorably to competing drugs used to treat peripheral T-cell lymphoma such as Celgene's Istodax and Spectrum's other PTCL drug Folotyn.

In the single-arm pivotal study, the overall response rate to belinostat was 26-28%, which matches Istodax and is just a tiny bit lower than Folotyn. Median duration of response to belinostat was 8.3 months, which is on the low end compared to Istodax (12 months) and Folotyn (10 months.)

Belinostat's strength is safety and tolerability. Patients in the study reported low rates of thrombocytopenia (13%), neutropenia (13%) and anemia (10%) -- much improved over Istodax and Folotyn which generally cause thrombocytopenia and neutropenia in 40% and 30% of patients, respectively. Anemia is reported in about 24% of patients for both drugs.

If these belinostat data hold up, FDA approval seems likely. The market opportunity in PTCL is small, however, and belinostat, if approved, will cannibalize Foltyn sales to some extent. Still, let's not start raining on Spectrum's parade just yet.

-- Reported by Adam Feuerstein in Boston.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.
3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,804.71 -238.19 -1.40%
S&P 500 1,946.16 -26.13 -1.32%
NASDAQ 4,422.0850 -71.3050 -1.59%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs