Biotech Alert: Searches spiking for these stocks today

These names in the biotech sector are seeing a substantial increase in search activity today, as determined by InvestingChannel. They include:

• Cassava Sciences (SAVA),450% surge in interest
• Esperion Therapeutics (ESPR), 212% surge in interest
• Tracon Pharmaceuticals (TCON), 69% surge in interest

Pipeline and key clinical candidates for these companies:

Cassava Sciences is a clinical-stage biotechnology company that says its mission is to detect and treat neurodegenerative diseases, such as Alzheimer’s disease. “Its novel science is based on stabilizing-but not removing-a critical protein in the brain. The company’s product candidates have not been approved by any regulatory authority, and their safety, efficacy or other desirable attributes have not been established,” Cassava has stated.

Esperion discovers, develops, and commercializes innovative medicines and combinations to lower cholesterol, especially for patients whose needs aren’t being met by the status quo.

Tracon is a clinical-stage biopharmaceutical company that says utilizing “a cost-efficient, CRO-independent, product development platform” it is advancing its pipeline of novel targeted cancer therapeutics and partnering with other life science companies. The company’s clinical-stage pipeline includes Envafolimab, a PD-L1 single-domain antibody given by rapid subcutaneous injection that is being studied in the pivotal ENVASARC trial for sarcoma; YH001, a potential best-in-class CTLA-4 antibody in Phase 1 development; and TRC102, a Phase 2 small molecule drug candidate for the treatment of lung cancer.

Recent news on these stocks:

July 1

In an update on government investigations shared in a regulatory filing, Cassava Sciences stated: “Cassava Sciences has been engaging with the U.S. Department of Justice and the U.S. Securities and Exchange Commission in connection with ongoing investigations into the company and two senior employees of the company. Cassava is cooperating with the DOJ and SEC in connection with these investigations. In the course of ongoing discussions with the SEC regarding the company’s Phase 2b study of simufilam in Alzheimer’s disease, the SEC recently provided the company with new information obtained during its investigation. The company’s board of directors has empowered an Ad Hoc Investigation Committee, comprising independent directors, to direct an investigation of the information provided by the SEC. The Internal Investigation is also evaluating information contained in the DOJ indictment of Dr. Hoau-Yan Wang discussed below. This Committee, with the assistance of the company’s General Counsel, is supervising outside counsel conducting the Internal Investigation. The Committee is also empowered to oversee the company’s disclosures in filings with the SEC regarding matters at issue in the Internal Investigation. The Internal Investigation is continuing… Based on the Committee’s preliminary review of information gathered in the Internal Investigation to date, the company is supplementing its prior disclosures, initially reported in September 2020, regarding the Phase 2b Study. The Phase 2b Study was designed as a 28-day, approximately 60-patient, randomized, double-blind, placebo-controlled, multiple dose study. One objective of the Phase 2b Study was to measure changes in levels of cerebrospinal fluid biomarkers in study participants from baseline value to Day 28. Based on CSF biomarker assays and bioanalysis conducted by Dr. Wang, Cassava reported statistically significant improvements in biomarkers in treatment groups as compared to the placebo group. To date, the Internal Investigation has determined that certain statistical information contained in an attachment to an email sent by a senior employee of Cassava to Dr. Wang before the bioanalysis could have been used to unblind him as to some number of Phase 2b Study participants. Another objective of the Phase 2b Study was to measure changes in cognitive outcome measures using the Cambridge Neuropsychological Test Automated Battery, or CANTAB, (a validated, computer-based battery of tests) over the 28-day study period. Neither Dr. Wang nor his laboratory at CUNY was involved in the cognition portion of the Phase 2b Study. With respect to the cognition portion of the Phase 2b Study, Cassava is reporting in this 8-K information regarding its post hoc statistical analysis with respect to selected CANTAB outcome measures for the Phase 2b Study. This information was previously disclosed in a draft preprint manuscript that was publicly available as of the first quarter of 2021. The Phase 2b Study’s CANTAB tests were not powered for statistical significance and were therefore evaluated only for effect size. In September 2020, the company reported on study participants’ episodic memory and spatial working memory, as assessed using CANTAB, over the 28-day study period. The company reported the primary outcome measurements of Paired Associates Learning total errors adjusted, in respect of episodic memory, and total errors in respect of Spatial Working Memory. Other outcome measurements that were generated by the CANTAB tests were not reported by the company. Although the 28-day Phase 2b Study enrolled 64 patients, the statistical analysis of the CANTAB outcome measurements reported by the company reflected certain study participant exclusions. With respect to the analysis of episodic memory measures, approximately 42% of study participants were excluded from the reported analysis. For these episodic memory test exclusions, the most and least impaired subjects were excluded by baseline score before the effect size was calculated. These cutoffs were employed to remove subjects with very few errors, as well as subjects who performed so poorly that they may not have understood the task evaluated by the test. Analysis of both CANTAB test data sets also excluded subjects with no detectable plasma simufilam, patients who were greater than or equal to25% noncompliant with the study’s treatment regimen by pill counts, patients with no baseline test, and patients who, according to study investigators, did not understand the test instructions. Accordingly, reported results reflected N=14, 13, 10 for episodic memory, and N=22, 17, 18 for spatial working memory for placebo, 50 and 100 mg, respectively. Because the results first reported in September 2020 reflect calculations of effect size after these exclusions, the company’s reported results reflect an analysis of a substantially smaller analysis-set population than the full Phase 2b Study population… The company is currently conducting two randomized, placebo-controlled Phase 3 clinical trials of oral simufilam in patients with mild-to-moderate Alzheimer’s disease. Both trials are fully enrolled. The trials have randomized a total of approximately 1,900 patients with mild-to-moderate Alzheimer’s disease at baseline. All efficacy data from the company’s Phase 3 program remain blinded. There are no interim analyses on efficacy outcomes. Phase 3 data and samples for bioanalysis will be directly provided to and analyzed by independent, third-party commercial consulting firms. Neither Dr. Wang nor his laboratory at CUNY has any involvement in the company’s ongoing Phase 3 clinical trials of simufilam.”

Tracon Pharmaceuticals announced the objective response rate by blinded independent central review in the fully enrolled ENVASARC pivotal trial in the 82 evaluable patients is 5%, which is lower than the primary endpoint of the study of 11% ORR by BICR needed to support a biologics license application. As a result, the company is terminating further development of envafolimab and is focusing entirely on exploring strategic alternatives in the near term that may include, but are not limited to, a merger, reverse merger, acquisition, other business combination, sales of assets, licensing or other strategic transactions involving the company. In pursuit of any potential strategic transaction, Tracon plans to leverage its turnkey in-house Product Development Platform utilizing integrated Veeva systems that has been used to conduct more than 15 Phase 1, 2 or 3 oncology trials at more than 120 sites in the U.S. and Europe across more than ten tumor types over 12 years, at a fully burdened cost of less than $100,000 per patient. Tracon offers cost-savings, time savings and enhanced quality of clinical trials using its PDP. There can be no assurance the exploration of strategic alternatives will result in any agreements or transactions, or, if completed, any agreements or transactions will be successful or on attractive terms. To the extent that it cannot complete a strategic transaction, there is no guarantee that the company will continue as a going concern. Tracon does not expect to disclose developments with respect to this process until the evaluation of strategic alternatives has been completed or the board has concluded disclosure is appropriate or legally required.

June 28

Esperion announced that it has entered into a Royalty Purchase Agreement with OMERS Life Sciences, under which Esperion received approximately $304.7M in cash from OMERS in exchange for 100% interest, subject to a cap, in Esperion’s royalty entitlement on Daiichi Sankyo (DSNKY) Europe’s, DSE, net sales of bempedoic acid products in the European territories for which DSE has an exclusive license from Esperion. Under the terms of the Agreement, OMERS will receive this tiered royalty, which ranges from 15-25% of net bempedoic acid product sales in Europe, until it has received an aggregate amount equal to 1.7x investment. Thereafter, all future DSE royalties will revert back to Esperion. Esperion will continue to receive any earned sales-based milestone payments following the first achievement of defined net sales under the DSE agreement, which could cumulatively amount to up to $300M in potential future payments.

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About “Biotech Alert”

The Fly will report on a selection of biotech stocks seeing a surge in interest from retail and financial professional investors, based on data from InvestingChannel.

This Fly exclusive recap reveals the biotech stocks that are seeing a spike in searches among the 20-plus million retail and financial professional investors through InvestingChannel’s online financial news media ecosystem.

This increased attention from the investors may be in response to, or advance of, outsized moves for stocks in the biotech sector, which tend to be volatile and prone to sharp swings in share price around binary events such as clinical study results and FDA approvals.