bluebird bio Advances As LentiGlobin Seen Moving Faster Than Expected

NEW YORK (TheStreet) -- The shares of drug developer bluebird bio  (BLUE) are surging after the company announced that its LentiGlobin BB305 drug could be granted accelerated approvals in both the U.S. and Europe as a treatment for beta-thalassemia major. In notes to investors earlier today, JPMorgan and Piper were upbeat on the outlook for the drug's development to progress faster than was previously expected.

WHAT'S NEW: After meeting with European and U.S. drug regulators, bluebird bio announced that it would participate in the EU's Adaptive Pathways pilot program. The program was launched by the EU in an effort to provide medicine to patients more quickly, the company stated. bluebird bio said that it now believes that it will be able to seek conditional EU approval of LentoGlobin as a treatment for beta-thalassemia major. Following its meeting with the FDA, bluebird said that data for upcoming clinical trials could enable the company to file an application for FDA approval of LentiGlobin. The company added that it had made agreements with the FDA on the general design of two of its upcoming trials.

ANALYST REACTION: Piper Jaffray analyst Joshua Schimmer wrote that Blubird seems poised to file for EU approval of LentiGlobin much sooner than anticipated, since EU regulators have indicated that they will enable the company to apply for approval on the basis of only two clinical studies, The FDA is also moving more quickly than Schimmer previously anticipated, the analyst stated. Schimmer said he had previously believed that LentiGlobin would be launched in 2020, but he now thinks the drug could be approved as early as 2017 in the EU and 2018-2019 in the U.S. The analyst kept an Overweight rating on the stock. Similarly, JPMorgan analyst Cory Kasimov wrote that LentiGlobin could be approved before his 2019 estimate, particularly in the EU, where the regulator is not requiring any new trials. LentiGlobin's outlook as a beta-thalassemia major treatment has become more certain as a result of the news, according to the analyst, who continued to recommend buying the shares of bluebird bio.

PRICE ACTION: In mid-morning trading, bluebird rose 5.4% to $164.85.

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