Oncology stocks ‘bearing the brunt’ of Prasad news, says Oppenheimer

Oppenheimer says Vinay Prasad, who has reportedly been nominated to lead the FDA’s Center for Biologics Evaluation and Research division, has long been a critic of using surrogate endpoints in the drug approval process. Oncology stocks are “bearing the brunt” of the news, as investors are likely viewing the news to mean that the agency will now become more critical on issuing accelerated approval based on surrogates such as objective response rate, the analyst tells investors in a research note. The firm, however, thinks the move may be an overreaction. Oncology companies have already been forced to adapt to changes at the FDA, Oppenheimer contends. It believes Ideaya Biosciences (IDYA), Tyra Biosciences (TYRA), Oric Pharmaceuticals (ORIC), Olema Oncology (OLMA), Relay Therapeutics (RLAY), Nurix Therapeutics (NRIX) are “being sold off despite having sound development strategies.”