Here’s Why Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE) and Moleculin Biotech Inc (NASDAQ:MBRX) Are Moving Today

FDA
FDA

A number of biotech companies are really moving as we head into the close of the week. Here’s a look at some of those with the most notable action, and what’s driving each.

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The companies in focus are Ultragenyx Pharmaceutical Inc. (NASDAQ:RARE) and Moleculin Biotech Inc (NASDAQ:MBRX).

So, let’s kick things off with Ultragenyx.

This one is one of the larger companies on today’s movers list. Ultragenyx has taken a hit on the announcement of some data from its lead study of a drug called UX007. The drug is under investigation as a potential treatment for patients with glucose transporter type-1 deficiency syndrome (Glut1 DS) with seizures. The drug itself is going after the seizures element of the just described condition. For those not familiar with DS, it’s caused by a genetic defect that creates a lack of efficient glucose transport to the brain. Too little glucose results in a bunch of different symptoms, one of which is the seizures this drug is going after.

The MOA is relatively simple in concept – the UX007, post administration, converts into glucose, and this should theoretically increase the amount of glucose that reaches the brain.

The latest study, which specifically aimed to reduce the frequency of tumors, didn’t reduce seizures across the population when observed as an aggregate group, and so technically, this counts as an endpoint miss. When looked at individually, however, and when the data specifically focuses in what are called absence seizures (shorter in nature than standard seizures), there is some seeming impact.

Exactly what this impact means for the development pathway going forward remains unclear. The drug is under investigation in a couple of other DS related indications, and so the chances of commercialization are far from dead, but management has been pretty vague on its interpretation of these seizure related numbers.

There’s a phase III study planned for DS sufferers with movement disorders (another common symptom od this condition) and that’s where markets are likely to turn their focus for the time being. We’ll probably see an update on the seizure study in a few weeks (read: is the company continuing in this specific target) but we don’t see it as too impactful near term.

At time of writing – mid session on Thursday – Ultragenyx is trading at an around 8% discount to its Wednesday close.

Moving on, Moleculin.

This one’s a little more upbeat. The company just announced that it has scored an Orphan Drug designation from the FDA for an asset called Annamycin. It’s an oncology asset, and it’s currently targeting a lead indication of acute myeloid leukemia (AML). The idea behind this drug is pretty simple. It’s a reformulation of an already approved (and very widely used) oncology drug called anthracycline. The latter works by inhibiting DNA synthesis in cancer cells, and this inhibition translates to both apoptosis (the cancer cells killing themselves, essentially) and the inhibition of replication (at least, replication of active cancer cells) to stop spread.

There’s a problem with it, however, and that’s that it is really toxic to the heart. This limits dosage, and in turn, limits efficacy.

With Annamycin, Moleculin has taken anthracycline and repackaged it to remove the cardiotoxicity. Reduced or removed cardiotoxicity translates to a higher dosing potential, which in theory, should translate to improved efficacy.

That’s the theory, at least, and there’s some early stage study data in place that seems to reinforce said theory. It’s still very early days, however, and this has many potential operators hesitant to pull the trigger ahead of some later stage data hitting press.

In the most recent release, however, the company has announced (as mentioned) that it’s now got Orphan Designation, and this brings with it a host of benefits that may serve to tip the risk reward scales in favor of the just mentioned hesitant operators pulling the trigger.

That’s why the company traded up on the news.

Of course, this designation doesn’t really tell us anything about chances of approval, and the risk side of the equation still very much remains in place. At time of writing, Moleculin is trading pretty much at or near its weekly open price, which serves to cement the fact that risk still very much dominates proceedings for the majority here.

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