FDA rejects Celgene’s application for ozanimod

Celgene receives Refusal to File letter from FDA regarding ozanimod NDA

Celgene tumbles
FDA rejects Celgene’s application for ozanimod

Celgene Corporation (CELG) announced that it has received a Refusal to File letter from the United States Food and Drug Administration regarding its New Drug Application for ozanimod in development for the treatment of patients with relapsing forms of multiple sclerosis.

Ozanimod is a novel, oral, selective sphingosine 1-phosphate 1 and 5 receptor modulator. Upon its preliminary review, the FDA determined that the nonclinical and clinical pharmacology sections in the NDA were insufficient to permit a complete review.

Celgene intends to seek immediate guidance, including requesting a Type A meeting with the FDA, to ascertain what additional information will be required to resubmit the NDA.

ANALYSTS  REACTION

UBS analyst Carter Gould noted Celgene disclosed the FDA issued a Refusal to File regarding the NDA for ozanimod in multiple sclerosis.

He believes this will likely delay its approval until at least 2019 and raise another round of questions on Celgene’s execution as the last six months have brought clinical, regulatory, and commercial setbacks. Gould maintained his Buy rating, but lowered his price target to $106 from $120.

SunTrust analyst Yatin Suneja downgraded Celgene to Hold from Buy and lowered his price target to $106 from $139. Suneja cites the FDA refusal letter on ozanimod for relapsing forms of multiple sclerosis after its determination that the nonclinical and clinical pharmacology sections in the NDA were “insufficient” to permit a complete review.

The analyst says ozanimod was “central to our bull thesis to re-accelerate growth in the I&I franchise”, lowering his projected peak sales estimate for the treatment to $3.5B from $5.0B following this latest setback.

Piper Jaffray analyst Christopher Raymond says Celgene’s diversification story “takes another hit” following receipt of a refusal to file letter from FDA for ozanimod’s multiple sclerosis new drug application submission.

 

Investors may now have to contemplate a multiple sclerosis launch that potentially coincides with Gilenya’s loss of exclusivity “unless a more aggressive timetable can somehow be salvaged,” Raymond tells investors in a research note. The analyst cut his estimates for ozanimod “dramatically” and prefers to remain on the sidelines with respect to Celgene shares. He keeps a Neutral rating on the name with a $95 price target.

PRICE  ACTION

CELG is  down over 6.5% to $89.50 in pre-market trading.

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Student Transportation sold for $7.50 a share

Student Transportation to be acquired by investors led by CDPQ

Student Transportation sold for $7.50 a share. Stockwinners.com
Student Transportation sold for $7.50 a share.

Student Transportation (STB) announced that it entered into a definitive agreement with a company sponsored by Caisse de depot et placement du Quebec and Ullico Inc. pursuant to which the Purchaser Group will acquire all of the company’s outstanding common shares by way of a plan of arrangement under the Business Corporations Act.

Student Transportation Inc. (STB) provides school bus transportation and management services to public and private schools in North America. The company offers contracted, managed, special needs transportation, direct-to-parent, and charter services. It operates approximately 290 contracts with a fleet of 13,000 vehicles.

Shareholders of STI will receive $7.50 per common share in cash, representing a 27% premium to the 20-day volume weighted average price per common share on the Toronto Stock Exchange for the period ending February 27, 2018, based on an exchange rate of $1.2776 Canadian dollars per U.S. dollars as of February 27, 2018.

Holders of STI’s 6.25% Convertible Unsecured Subordinated Debentures will receive the product of $7.50 and the number of Common Shares that the holders would be entitled to receive upon the conversion of their 2013 Debentures in accordance with their terms immediately following the closing date of the Arrangement, including those issuable upon a “Cash Change of Control”, plus the sum of accrued and unpaid interest on such debentures up to but excluding the Closing Date and the interest that would have otherwise accrued from and including the Closing Date to but excluding 32 days thereafter.

Holders of STI’s 5.25% Convertible Unsecured Subordinated Debentures will receive the product of $7.50 and the number of Common Shares that the holders would be entitled to receive upon the conversion of their 2016 Debentures in accordance with their terms immediately following the Closing Date, including those issuable upon a “Cash Change of Control”, plus the sum of accrued and unpaid interest on such debentures up to but excluding the Closing Date and the interest that would have otherwise accrued from and including the Closing Date to but excluding 32 days thereafter.


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