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Biotech Stock Mailbag: Celldex, Exelixis, Geron, NPS Pharma

Yet Geron, stubbornly, refuses to die. The latest -- and perhaps last -- comeback attempt has the company betting it all on imetelstat in myelofibrosis. The Mayo Clinic is running a small, early-stage study and recently informed Geron that at least two responses to imetelstat were reported in two different dosing cohorts of 11 patients each. A third cohort of patients is now enrolling in the study. [The principal investigator of the imetelstat study is Dr. Ayalew Tefferi, which will make investors who pay close attention to myelofibrosis drug development either cheer or jeer. He's a polarizing guy.]

Tefferi will be presenting these interim imetelstat data at the American Society of Hematology (ASH) annual meeting in early December. Geron has already told investors that it will likely start its own multi-center study of imetelstat in myelofibrosis, based on what it believes are promising results from the Mayo study.

I'd caution to wait until we see these Tefferi imetelstat data at ASH before reaching any conclusions about Geron's viability.

But remember what I said above about investors wanting to own biotech stocks regardless of the risks involved? Well, imetelstat hasn't been declared dead yet officially, which explains why Geron's chart looks like this for the past three months: GERN ChartGERN data by YCharts

Geron's fully diluted market cap today is approaching $500 million, which is what Gilead Sciences (GILD) paid to acquire YM BioSciences and its myelofibrosis drug CYT387 (since renamed momelotinib.) The difference is that momelotinib was ready to enter phase III studies when Gilead picked it up. Geron's imetelstat isn't there yet and we have no real clue if the drug's efficacy and safety are comparable to competing myelofibrosis drugs.

If momelotinib isn't more effective or safer than Incyte's (INCY) Jakafi, for example, Geron will have a tough time justifying the expense of moving the drug forward.

You're right, the concerns I raised about insurers pushing back on NPS Pharmaceuticals (NPSP) due to the high cost of Gattex were wrong. NPS has done very well with the Gattex launch and the stock has reacted accordingly: NPSP ChartNPSP data by YCharts

I still believe the risk of insurers putting more reimbursement restrictions on high-priced orphan drugs exists, but I admit evidence of a clampdown to date is scant and I was clearly wrong about NPS Pharma. To their credit, my colleagues at TheStreet Jim Cramer and David Peltier have both been enthusiastic supporters of NPS this year.

-- Reported by Adam Feuerstein in Boston.

Follow Adam Feuerstein on Twitter.

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.
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