The S&P Select Biotech Index moved back towards the 50-day moving average as the momentum factor took a pause from driving equity performance.
Messaging from the President's SOTU Address indicated an interest in expanding IRA drug price controls, perhaps expanding the 'list' to 50 drugs per year up from the initial n=10. Biden went further and discussed a $2k cap on drug prices for Medicare patients that might be extended to everyone. Getting the camel's nose under the tent is a persistent theme with many of these proposals and was the basis for his claim that price controls on 500 drugs would 'save' $200 billion. Drug pricing talking points will likely remain a staple for both candidates in this election cycle but seem unlikely to move forward into law with a narrow majority or divided government.
M&A:
Cymabay Therapeutics' (CBAY) initial HSR waiting period expired paving the way for a rapid deal closing
Merck completed the acquisition of Harpoon Therapeutics (HARP)
Regulatory:
Bristol Myers Squibb (BMY), Johnson & Johnson (JNJ), Novartis AG (NVS), and Novo Nordisk A/S (NVO) will move forward to present their arguments in a hearing among the four separate lawsuits before the US District Court for the District of New Jersey
Soleno therapeutics (SLNO) sold off after disclosing "FDA stated that the potential for data from the DCCR clinical program to provide substantial evidence of effectiveness will be a matter of review following the submission of an NDA" during the recent quarterly update. SLNO is filing for approval on the basis of a Phase 3 trial that missed its primary endpoint, but augmented with positive data from a blinded randomized withdrawal study conducted on the Phase 3 open-label extension population
Vanda Pharmaceuticals (VNDA) announced FDA issued a CRL for Hetlioz in insomnia characterized by difficulties with sleep initiation
Clinical:
Amylyx Pharmaceuticals (AMLX) fell 82% after announcing the Phase 3 PHOENIX trial for AMX0035 in ALS did not meet its primary endpoint. Analysts expect the drug will be pulled from the market given the failure to show clinical benefit
Novo Nordisk (NVO) reached a record high on updates from their obesity pipeline at the recent capital markets day. Updates included Phase 1 results of Monlunabant (INV-202), an oral small molecule CB1R inverse agonist demonstrating weight loss potential in Phase 1 and data from their ongoing oral amycretin Phase 1 demonstrating -13.1% weight loss at 12 weeks (vs -1.1% with placebo). Novo cautioned that the latter data set was in a small number of patients (n=16) and safety data was not disclosed. Several other obesity companies sold off on the news
Corporate Updates & Earnings:
Revance Therapeutics (RVNC) rose on an insider purchase of shares by the CEO
Avid Biosciences (CDMO) shares sold off after the company announced accounting restatements related to convertible notes. The acceleration notice from a holder of its 1.250% Exchangeable Senior Notes due 2026 was followed with an announcement of a $160M private placement of 7.00% convertible senior notes due 2029