Sorrento Shares Climb on FDA Covid-Drug Trial Clearance

Sorrento Therapeutics says it has been cleared by the FDA for a Phase II trial of abivertinib, designed to fight covid.
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Sorrento Therapeutics  (SRNE) - Get Report shares on Monday were higher after the biopharma said it had been cleared by the U.S. Food and Drug Administration to start a Phase II trial of abivertinib in patients with coronavirus who have moderate to severe pulmonary symptoms.

Shares of the San Diego company at last check were up 19% to $8.29.

Abivertinib has been studied in more than 600 patients worldwide for various oncologic indications, including one registration trial in non-small-cell-lung cancer.

In May, Sorrento said that it had entered a binding term sheet for an exclusive license to ACEA Therapeutics' abivertinib for all territories outside China. The parties have since entered an exclusive license agreement.

Dawson James analyst Jason Kolbert said Monday in a note to clients that the news from Sorrento is consistent with the company's goal to generate an antibody cocktail against coronavirus infection. 

He added that this cocktail could move rapidly to commercialization through the U.S.'s Project Warp Speed initiative, which aims to deliver a vaccine at scale by January. 

Kolbert has a buy rating on the stock and a $24 price target. He said he saw a 50% probability that the company successfully develops Covi-Shield, its neutralizing antibody cocktail.

Sorrento said the cocktail could potentially create a high barrier to emergence of resistant variants in treated individuals. 

It would act as a "prophylactic for those returning to work and as a therapeutic to those who have been exposed to SARS-CoV-2," the company said in a statement.

Separately, Sorrento said in May that its anti-SARS-CoV-2 antibody, STI-1499 provides "100% inhibition" of SARS-CoV-2. 

The company said STI-1499 will likely be the first antibody in the antibody cocktail it is developing.