ArQule, Inc. (NASDAQ:ARQL) is attracting a substantial amount of attention in the biotechnology sector as we head into the start of a fresh week of trading, with the company serving up a degree of insight into one of its lead investigative programs and markets responding positively to the development.
So what happened?
Well, for anybody not familiar with this company, ArQule is a Burlington, Massachusetts based biotechnology company that is working on the development and manufacture of treatments for various rare diseases and cancer types. It’s a micro/small-cap stock currently valued at just shy of $250 million and $2.59 a share and its valuation is rooted primarily in the progress of the above-mentioned program (as well as a handful of others) towards commercialization of the drug that underpins it in the US.
Anything that hits press as positive (i.e., indicative of a strengthened chance of this drug picking up approval once it goes in front of the FDA) is going to inject a degree of positive sentiment into the company, which, in turn, will serve to boost near-term market capitalization.
And that’s exactly what we have seen here.
To offer up a bit of background, the drug in focus here is called miransertib (ARQ 092) and the trial on which we just got some new information was set up to investigate its potential safety and efficacy when combined with anastrozole in patients with endometrial or ovarian cancer. This latter asset is an already established and widely used drug that is administered both as a preventative and a responsive treatment in women at risk of breast cancer and, specifically, those with hormone receptor positive breast cancer.
ArQule is hoping that it can add its own asset to a regimen of anastrozole (which, in and of itself is normally administered as part of a combination treatment with a chemotherapy or immunotherapy agent) and, in doing so, can increase the response rates in these patients as compares to treatment with anastrozole and another drug on their own.
And as per the latest release, it looks as though the company has been able to show that its drug can do just that.
In its latest communication, ArQule management reported that 4 out of 11 patients achieved a response (1 confirmed complete response, 3 unconfirmed partial responses). All responses (that is, both confirmed and unconfirmed) were in endometrial cancer (4/8 patients).
As might be expected, then, this sort of response has translated to some immediate upside action for the company, with shares of ArQule gaining somewhere in the region of 10% after the bell on Friday and looking set to strengthen further as the markets open for a fresh day of trading on Monday morning.
So, what comes next?
Well, it’s worth noting that this release is rooted in an abstract that the company intends to present at the American Association for Cancer Research (AACR) Annual Meeting, which started over the weekend and which wraps up during the middle of this week.
With this in mind, there is a strong chance that we will see a continuation of the volatility over the coming week or so, as markets fully digest the entire presentation (abstracts usually leave out some information, meaning the interpretation could be altered as and when the full picture becomes clear).
What’s next, then, is a market response to fresh information both rooted in this trial and as the event matures to completion.
other noteworthy abstracts from the events included those of Dynavax Technologies Corporation (DVAX) and Bristol-Myers Squibb Company (NYSE: BMY), both of which released positive abstracts ahead of the event (at the same time as that of ArQule) and both of which are benefiting from some positive sentiment in the wake of the releases in question.
Keep in mind that we will likely see a substantial amount of volatility across the entire space this week and that this volatility makes trading that little bit riskier than might normally be the case, even this sector.
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