These 8 Biotechs Are In This Week’s Spotlight
This week, the annual meeting of the American Diabetes Association
should focus the spotlight on many companies developing new drug treatments for
diabetes (see
last week’s biotech piece). Diabetes is a growing problem, particularly in
children, and costs this country’s healthcare system billions of dollars.
Despite being effective, today’s treatment for Type I diabetes
(insulin-dependant) is also cumbersome due to the need for insulin injections.
One of the hot topics at this year’s diabetes meeting is the development of
alternative delivery methods for insulin in order to avoid painful
shots. Several companies in this space should get some exposure over the next
two days. These include Aradigm
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Emisphere Technologies
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Generex Biotech
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Nektar
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Since investor appetite for biotechs remains strong for new drugs with
impressive clinical data, company participants at the American Diabetes
Association meeting should be the beneficiary of short-term upward momentum over
the next two days.Â
Other Biotechs To Watch
In addition to companies developing new treatments for diabetes, I am also
looking at four other biotechs that may move in the next two weeks.
Cubist Pharmaceuticals
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(according to the company) to receive a decision by the FDA by June 20 on its
new antibiotic to treat soft tissue infections. In February, the FDA accepted
Cubist’s New Drug Application for its new antibiotic Cidecon. In addition, the
FDA granted “Fast Track†status, meaning it will accelerate the drug’s review
process.  Both announcements lead to an immediate 15% increase in the stock
price. Cidecon is a new type of antibiotic aimed at treating soft tissue
infections caused by bacteria normally resistant to many of today’s
antibiotics. This so-called Methicillin-Resistant Staph. Aureus (MRSA)
infection is difficult to treat. The clinical data released to the public so
far on Cidecon’s efficacy looks promising. Antibiotics are big business and new
ones aimed at bacteria resistant to many on the market today will get attention
if approved by the FDA.Â
I am also looking at a company called Neurogen
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(phase II trials) it is testing to treat asthma and rheumatoid arthritis, two
very large disease markets. In addition, it is also developing a drug to treat
insomnia. This drug is being developed with Pfizer and is currently in phase I
clinical trials. What may move this stock this week is the presentation of
preclinical data on a new drug to treat obesity. The company is presenting at
the annual meeting of the Endocrine Society on June 19 preclinical data on its
new drug to treat obesity in mice. This meeting may take a back seat to the
more popular ADA meeting starting today. However, Neurogen’s presentation does
show its new drug to be effective in reducing weight in mice and the company
should be the beneficiary of post-ADA meeting momentum.
Northfield Labs
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is also on my radar screen. This company is on the
forefront in developing an oxygen-carrying blood substitute to treat patients
requiring blood transfusions. Several companies are racing to get the FDA’s
blessing of the first effective blood substitute that could replace the need for
blood transfusions in certain situations. This is a hot area of development now
and there is much at stake financially for several companies. The military is
keenly interested in finding a suitable blood substitute that it could use on
the battlefield to treat trauma patients. Northfield Labs appears to have the
edge on the competition on many fronts. The stock price had a nice run as last
week ended, in part due to the announcement of a definitive trial testing its
blood substitute Polyheme in trauma patients before they are brought to the
hospital. The FDA has given the company it’s blessing to start this trial and
use the results as a base for filing a New Drug Application. Starting Thursday,
the American Society of Artificial Organs will meet in Washington, D.C. This
meeting will discuss cutting edge biotechnology in the field of regenerative
tissues, replacement organs, and human transplantation. Specifically, this
meeting will update the scientific community on the current status of companies
developing oxygen-carrying blood substitutes, an update that can only benefit
Northfield Labs.
A final company I am keeping a watch on is
SciClone Pharmaceuticals
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Paul Ruggieri MD, FACSÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â
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