Ra Pharmaceuticals tumbles on data, downgrade

RA Pharma slides after data as analyst voices competitive concerns

RA Pharma slides after data as analyst voices competitive concerns
RA Pharma slides after data as analyst voices competitive concerns

Ra Pharmaceuticals (RARX) announced that its RA101495 SC for the treatment of paroxysmal nocturnal hemoglobinuria met the primary endpoint in the Eculizumab native cohort in a clinical trial.

However, Piper Jaffray analyst Christopher Raymond argued that the data “underwhelms on efficacy” in comparison to Alexion’s (ALNX) Soliris.

TRIAL RESULTS

Ra Pharmaceuticals has announced interim results from the company’s ongoing, global Phase 2 clinical program evaluating RA101495 SC for the treatment of paroxysmal nocturnal hemoglobinuria.

RA101495 SC met the primary endpoint in eculizumab naive patients. In these patients, a rapid, robust, and sustained reduction in lactate dehydrogenase levels from baseline to the mean of Weeks 6-12 and near-complete suppression of complement activity were observed.

Interim results from the ongoing switch cohort demonstrate near complete, sustained, and uninterrupted inhibition of complement activity during and after eculizumab washout. In the U.S.-based cohort of inadequate responders to eculizumab, who have a history of elevated LDH, 3 patients have been enrolled.

LDH stabilization and relief of side effects associated with eculizumab intolerance have been observed in the first patient enrolled in this cohort. Across all cohorts, no meaningful safety or tolerability concerns have been identified after more than 300 patient weeks of cumulative exposure, the company reported.

DATA ‘UNDERWHELMS’ COMPARED TO SOLIRIS

Piper Jaffray‘s Raymond told investors that he believes the paroxysmal nocturnal hemoglobinuria data from RA Pharmaceuticals “underwhelms on efficacy” in comparison to Alexion’s Soliris “and for that matter” ALXN1210.

Noting that inferior efficacy to Soliris on its own should put the threat from Ra Pharmaceuticals to bed, he reminded investors nonetheless that ALXN1210 should raise the bar from a convenience standpoint.

The analyst added that he sees “little reason to fret” at this point over the competitive threat to Alexion from RA101495, and reiterated an Overweight rating and $170 price target on Alexion’s shares.

RA PRICE TARGET UPPED

Meanwhile, his peer at BMO Capital raised his price target for RA Pharmaceuticals to $34 from $31, while reiterating an Outperform rating, after its RA101495 demonstrated clinical benefit in all three cohorts in the ongoing Phase 2 trial.

Analyst M. Ian Somaiya told investors in a research note of his own that he believes the phase 3 design is rational and likely to succeed.

Commenting on the potential impact on Alexion, the analyst noted that positive ‘1495 data supports his view that ALXN1210 Phase 3 results need to maintain if not raise the high efficacy and safety bar set by Soliris.

Data from Phase 1/2 trials in the first half of 2018 of Roche (RHHBY)/Chugai’s C5 antibody, with a similar profile to ALXN1210, represents the biggest competitive threat to Alexion, he contended.

PRICE ACTION

In Monday afternoon trading, shares of Ra Pharmaceuticals have dropped almost 40% to $8.80, while Alexion’s stock has gained about 3% to $112.37.


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Ironwood Pharmaceuticals reports positive results

Ironwood reports Phase IIa data for IW-1973 demonstrating positive effects 

Ironwood Receives FDA Approval of Duzallo. See Stockwinners.com Market Radar for more
Ironwood reports Phase IIa data for IW-1973 demonstrating positive effects 

Ironwood Pharmaceuticals (IRWD) announced encouraging top-line results from two Phase IIa studies of IW-1973, Ironwood’s lead investigational soluble guanylate cyclase stimulator, in patients with type 2 diabetes and hypertension.

Consistent with pre-clinical observations, in both studies treatment with IW-1973 led to blood pressure reductions and improvements in metabolic parameters, including reductions in fasting plasma glucose and cholesterol levels, in patients who were taking a stable regimen of therapies to manage their disease.

Elevated levels of plasma cGMP provided clear evidence of target engagement. These studies confirm a pharmacokinetic profile of IW-1973 supporting once-daily dosing and suggest broad distribution to tissues, offering the potential for extra-vascular pharmacology. IW-1973 was generally well-tolerated.

Ironwood is currently developing IW-1973 for the treatment of diabetic nephropathy and for the treatment of heart failure with preserved ejection fraction.

The company recently initiated two new Phase II dose-ranging clinical trials with IW-1973 in these indications.

The two Phase IIa exploratory studies were designed to evaluate the safety and tolerability, pharmacokinetics and pharmacodynamics of IW-1973 in diabetic patients with hypertension on a stable regimen of medicines to manage their disease.

The studies were not designed or powered explicitly to assess efficacy, but the data yielded clear and consistent trends indicating a positive effect of IW-1973 on blood pressure, metabolic parameters and endothelial function biomarkers.

At day 14, patients treated with IW-1973 showed a mean decrease in mean arterial blood pressure of 6.3 mmHg from baseline compared to a decrease of 1.6 mmHg from baseline in patients treated with placebo, as measured by 24-hour ambulatory blood pressure monitoring, which was a 4.7% greater reduction in patients treated with IW-1973 compared to placebo-treated patients.

IRWD closed at $17.32.


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Hartford sells Talcott Resolution for $2.05 billion

Hartford Financial to sell Talcott Resolution to investors for $2.05B

Hartford Financial to sell Talcott Resolution to investors for $2.05B
Hartford Financial to sell Talcott Resolution to investors for $2.05B

The Hartford (HIG) has entered into a definitive agreement to sell Talcott Resolution, its run-off life and annuity businesses, to a group of investors led by Cornell Capital LLC, Atlas Merchant Capital LLC, TRB Advisors LP, Global Atlantic Financial Group, Pine Brook and J. Safra Group.

Total consideration to The Hartford is $2.05B, comprised of cash from the investor group, a pre-closing cash dividend, debt included as part of the sale, and a 9.7% ownership interest in the acquiring company. The total consideration amount does not include $1.4B in dividends previously paid by Talcott Resolution in 2017.

The sale is anticipated to close in the first half of 2018, subject to regulatory approval and other closing conditions.

Under the terms of the sale agreement and subject to regulatory approval, the investor group will form a new company that will purchase Hartford Life, the holding company for the Talcott Resolution operating subsidiaries, for a net payment of $1.443B in cash.

The Hartford will receive a 9.7% ownership interest, valued at $164M, in the new company.

Subject to regulatory approval, The Hartford also expects to receive $300M in a pre-closing dividend from Talcott Resolution and will reduce its long-term debt by $143M because debt issued by HLI will be included as part of the sale.

In addition, The Hartford will retain Talcott Resolution tax benefits with an estimated GAAP book value of $950M, which will be available for realization subject to the level and timing of The Hartford’s taxable income.

As a result of The Hartford’s election to retain certain tax benefits, the company will not recognize a tax capital loss on the sale.

Based on the terms of the sale and the retention of the tax attributes, The Hartford estimates that the sale will result in a GAAP net loss of approximately $3.2B, after tax, which would be recorded in discontinued operations in fourth quarter 2017.

The estimated loss on sale and the estimated retained tax benefits and our ability to realize such benefits are based on current tax law and are subject to a final determination of the tax basis of the operations sold.

Beginning in fourth quarter 2017 and continuing until closing of the transaction, the results of operations of Talcott Resolution will be reported as discontinued operations for all periods presented in The Hartford’s financial statements.

Prior to the closing of the transaction, the company’s Group Benefits and Mutual Funds subsidiaries, which are currently subsidiaries of HLI, will be transferred to another Hartford subsidiary and will not be part of the transaction.

In addition, immediately after closing, Talcott Resolution will reinsure a portion of its fixed annuity, payout annuity and structured settlement businesses to a subsidiary of Global Atlantic Financial Group.

Following the sale, Hartford Investment Management Company, The Hartford’s investment management group, will continue to manage a significant majority of Talcott Resolution’s investment assets for an initial 5-year term.

HIMCO also will be retained by Global Atlantic to manage certain assets associated with the post-closing reinsurance agreement. As part of the transaction, about 400 Hartford employees will become employees of the new company and will be located at offices currently owned or leased by The Hartford in Windsor, Connecticut, and Woodbury, Minnesota.

HIG closed at $57.43.


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