We are midway through the week and it is time to take a look at some of the stocks in the biotechnology space that have been grabbing headlines and moving on the back of the extra attention. It has been a busy week so far, giving us plenty to go at today. With that said, however, a number of companies have stood out from the crowd as being particularly pertinent.
So, here goes.
The two companies we are focusing on for the session today are Neuralstem, Inc. (NASDAQ:CUR) and Pacira Pharmaceuticals, Inc. (NASDAQ:PCRX).
Let’s kick things off with Neuralstem.
This one is rooted in the release of some data from a trial that the company is conducting in an attempt to demonstrate the safety and efficacy of one of its lead development assets, a drug called NSI-189.
It is under investigation as a potential therapy for major depressive disorder (MDD), which is an increasingly common disorder in the US and one that – for the most part – doesn’t have a particularly effective long-term treatment. Those drugs that are currently on the market for this condition either bring with them a spate of undesirable side effects or end up reducing in efficacy over time and with chronic use. For a condition like MDD, chronic use is often necessary, meaning the reduced efficacy is a real problem in the space.
NSI-189 is part of a family of drugs called Nootropics, which have increasingly become attractive targets for companies in the space over the last couple of years. A number of investigations are currently underway in this indication and with this class of asset and anecdotal evidence (as well as a spate of early-stage trial data) suggests that patients are finding the drug to be useful and safe.
Unfortunately for Neuralstem, however, the outcome of the latest trial didn’t fall in line with the just mentioned data and evidence. As per the latest release, the company made markets aware that the drug did not meet its primary efficacy endpoint of a statistically significant reduction in depression symptoms on the Montgomery-Asberg Depression Rating Scale (MADRS), with the latter being an industry gold standard scale used in this sort of neurological disorder indication as a core measure of severity.
The trial was a phase 2 trial, so it would have underpinned an advance into a pivotal study if the data came back as positive. With this in mind, the reaction from markets has been decidedly negative (as expected) and the company is currently trading down around 50% on its pre-announcement market capitalization.
Next up, Pacira.
Just as with Neuralstem, this move is a data-driven move and, again, just as with Neuralstem, it hasn’t gone the way that the company and shareholders would have liked it to.
On Tuesday, Pacira put out data from a phase 3 program for a drug called EXPAREL. The program included two phase 3 studies, both of which investigated the safety and efficacy of the asset in a population suffering from what’s called prolonged regional analgesia. For those not familiar with this condition, it is a form of analgesia whereby only a single part of the body is affected at one time. The drug is a single dose neuron blocker, so the idea is that by blocking the neurons associated with the part of the body in question (the one affected by the condition) EXPAREL could alleviate the symptoms associated with it. A wealth of early-stage data supported this hypothesis and markets headed into this release expecting a reasonably positive outcome. As it turns out, however, this wasn’t to be.
Not at a glance, anyway.
In the first phase 3, which looks at the drug’s impact in patients undergoing one of two upper extremity surgeries (total shoulder arthroplasty or rotator cuff repair), the trial hit its primary endpoint. In the second, however, which looked at the drug in patients undergoing a lower extremity surgical procedure (total knee arthroplasty, or TKA), the endpoint was not met.
Pacira is trading down around 15% on the news, but this decline might be an opportunity to buy the dip. The company made markets aware that the failure was due to a failure of the trial center to follow protocol, meaning that the drug might have performed better at outcome if the trial had been run correctly.
The primary endpoint meet on the first phase 3 reinforces this suggestion.