Cempra to Merge with Melinta Therapeutics

Cempra subsidiary to merge with Melinta Therapeutics

Cempra subsidiary to merge with Melinta Therapeutics. See Stockwinners.com Market Radar for details

Cempra (CEMP) and Melinta Therapeutics announced that the companies have entered into a definitive agreement under which Melinta will merge with a subsidiary of Cempra.

The merger is expected to create a NASDAQ-listed company committed to discovering, developing and commercializing important anti-infective therapies for patients and physicians in areas of significant unmet need.

“The combined company’s extensive pipeline, including commercial, clinical and preclinical stage anti-infective programs with multiple products in development across several indications, provides an exceptional platform to deliver potential long-term growth and value for shareholders,” said David Zaccardelli, Pharm.D., acting chief executive officer of Cempra.

On a pro forma basis, and based upon the number of shares of Cempra common stock to be issued in the merger, current Cempra shareholders will own approximately 48 percent of the combined company and current Melinta shareholders will own approximately 52 percent of the combined company.

The transaction has been approved by the board of directors of both companies. The merger is expected to close in the fourth quarter of 2017, subject to the approval of the stockholders of each company as well as other customary conditions.

The combined company, which will be named Melinta Therapeutics, will bring together a deep bench of management talent from both companies. The board of directors of the combined company will have nine seats, with four appointed by Cempra and four appointed by Melinta, together with a newly appointed CEO.

Cempra and Melinta will work together through a joint selection committee to identify the CEO leadership of the combined company, who will be able to build on strong experience and the shared vision of the board to continue growing one of the world’s leading anti-infectives companies.

Melinta will designate the Chairman of the combined company board.

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Depomed Tumbles on Results, Downgrades

Analyst says sell Depomed as challenging opioid environment seen persisting

Depomed Tumbles on Results, Downgrades. See Stockwinners.com Market Radar to read more.

Shares of Depomed (DEPO) are plunging after the company reported weaker than expected second quarter results and lowered its guidance. Reacting to the announcement, Janney Capital and Morgan Stanley downgraded the stock to Neutral and Underweight, respectively.

RESULTS

Last night, Depomed reported second quarter earnings per share of 8c, which was below consensus of 9c, and announced revenue of $100M for the quarter, beating the expected $99.42M. The company also said it sees 2017 revenue of $400M-$415M, compared to consensus of $418M and the company’s prior view of $410M-$430M issued in May.

MOVING TO THE SIDELINES

In a post-earnings note to investors, Janney Capital analyst Ken Trbovich downgraded Depomed to Neutral from Buy after another “disappointment.” While the company had pre-released second quarter results just weeks ago and had reaffirmed its full year guidance, Depomed surprised by lowering its full-year outlook for revenues and raising its expense guidance, the analyst pointed out.

#Trbovich noted that the revised guidance seems to be an admission that the challenges facing its business are far greater to overcome than fixing the sales force realignment implemented by the prior CEO.

Further, the analyst argued that the new CEO’s hope for demonstrating separation for negative industry trends for opioids by year-end has been replaced by the possibility it happens sometime next year. He also cut his fair value estimate on the stock to $8 from $18.

SELL DEPOMED

Meanwhile, Morgan Stanley analyst David #Risinger downgraded Depomed this morning to Underweight, a sell-equivalent rating, as he fears it will continue to underperform given pressures on the company’s number one franchise, Nucynta, an opioid for pain.

The analyst pointed out that opioid prescription market declines are driving lower Nucynta sales than expected, even though it has gained some market share. Government officials have been voicing increasing concerns about the opioid crisis in America, and they are intent on driving use down, Risinger said, adding that it appears that Nucynta will continue to be under pressure.

Moreover, the analyst highlighted that IMS prescription market trends indicate that short-acting opioids are declining 8% year over year and long-acting opioids are declining 11% year over year. While saying it is unclear if new management appointed earlier this year and the company’s board can unlock value, Risinger noted he learned that activist board member Gavin #Molinelli of #Starboard will shift from the Board Member seat he assumed in March 2017 to “Board Observer” on August 15.

He also lowered his price target on Depomed’s shares to $5 from $12.

OPIOID ENVIRONMENT

On June 8, Depomed and Insys Therapeutics (INSY) were under pressure after the Food and Drug Administration requested that Endo Pharmaceuticals (ENDP) remove its opioid pain medication, reformulated Opana ER, from the market. After careful consideration, the agency is seeking removal based on its concern that the benefits of the drug may no longer outweigh its risks, the FDA stated. This was the first time the agency has taken steps to remove a currently marketed opioid pain medication from sale due to the public health consequences of abuse.

PRICE ACTION

In Tuesday morning trading, shares of Depomed dropped $3.01, or 32.5%, to $6.22.

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Call Options Active on 22nd Century XXII

22nd Century has created tobacco with 97 percent less nicotine

22nd Century has created tobacco with 97 percent less nicotine. See Stockwinners.com Market Radar for more.

Last month, the FDA announced a new comprehensive plan for tobacco and nicotine regulation that will serve as a multi-year roadmap to “better protect kids and significantly reduce tobacco-related disease and death.” The approach shifts focus to nicotine and the issue of addiction as the center of the agency’s tobacco regulation efforts. The focus will be tobacco products with less nicotine.

Since then, shares of  22nd Century Group Inc. (XXII) have risen since then because it grows tobacco plants with just 3 percent of the nicotine in typical tobacco plant.

As stocks of cigarette giants plunged over the past two weeks, 22nd Century’s shares have gained about 70 percent, last traded at $2.35.

Bloomberg reports that producing a cigarette with low levels of nicotine, the addictive stimulant in cigarettes, has been a challenge for the industry since as far back as the 1960s. Large tobacco companies such as Philip Morris International Inc. (PM) have tried their hand at it and failed. The Food and Drug Administration has explored the issue for several years, though — in 2013 it held a listening session where the idea of cutting nicotine levels came up.

Second day of active trading in 22nd Century Group calls

Friday’s bullish flow created 2.3K open interest in Jan 3 call options. After reaching 52-week highs of $2.84 Monday, shares now down 13c to $2.34 and 3.7K Jan 4 calls have changed hands. Jan 3, Sep 2, and Oct 2 calls are next most active. Total volume is 12X daily average at 8.1K calls and 655 puts. Next earnings date not known, but possibly inside the August expiration.

XXII has a 52-week trading range of $0.81 to $2.84.

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NxStage Medical Sold for $2 Billion

NxStage Medical to be acquired by Fresenius Medical for $30 per share

NxStage Medical to be acquired by Fresenius Medical for $30 per share. See Stockwinners.com Market Radar

Fresenius Medical Care (FMS) has signed an agreement to acquire NxStage Medical (NXTM).

NxStage, with 3400 employees, develops, produces and markets an innovative product portfolio of medical devices for use in home dialysis and in the critical care setting.

In 2016, NxStage delivered $366M in revenue. Fresenius Medical Care intends to acquire all outstanding shares of NxStage through a merger for $30.00 per common share, thus the transaction would be valued at approximately $2B.

The merger, which has been approved by NxStage’s board, is subject to approval of NxStage stockholders, receipt of regulatory approvals and other customary closing conditions.

Fresenius Medical Care currently expects the closing to occur in 2018.

The transaction would be cash and debt financed. An initial net cost synergies potential of approximately $80M to $100M p.a. before tax over three to five years is expected.

Integration cost of around $150M in the first three years from announcement are assumed.

Fresenius Medical Care expects the acquisition to be accretive to net income and EPS within three years from closing.

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MyoKardia Sharply Higher on Phase 2 Results

MyoKardia says Phase 2 PIONEER-HCM study met primary, key secondary endpoints

MyoKardia says Phase 2 PIONEER-HCM study met primary, See Stockwinners.com Market Radar

MyoKardia (MYOK) announced positive topline data from the first patient cohort of its Phase 2 PIONEER-HCM study of mavacamten in symptomatic, obstructive hypertrophic cardiomyopathy, or oHCM, patients.

This cohort met the primary endpoint of change in post-exercise peak left ventricular outflow tract, or LVOT, gradient from baseline to week 12 as well as key secondary endpoints, including peak oxygen consumption, or peak VO2.

Based on these results and subject to discussions in the coming months with the FDA, MyoKardia is planning for its next study, EXPLORER-HCM, to be a pivotal study.

EXPLORER-HCM is expected to initiate by the end of this year. In this first patient cohort of PIONEER-HCM, 11 patients enrolled and 10 completed the study.

A statistically significant improvement was observed in the primary endpoint, change in post-exercise peak LVOT gradient from baseline to week 12.

After 12 weeks of treatment, all 10 subjects achieved a reduction in post-exercise peak LVOT gradient from a baseline mean of 125 mmHg. In eight of the 10 subjects, the post-exercise peak LVOT gradient was reduced below the diagnostic threshold for oHCM, with the other two patients’ measurements below 50 mmHg.

Clinically meaningful improvements in resting LVOT gradient were observed as early as week 2 in nine out of 10 subjects, providing the rationale for the addition of a second, low-dose cohort to the PIONEER study.

Additionally, clinically and statistically significant improvements were observed in peak VO2.

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United Therapeutics Is For Sale!

United Therapeutics rises on reports multiple buyers in pursuit

United Therapeutics Is For Sale! See Stockwinners.com Market Radar for details.

Shares of United Therapeutics (UTHR) are up following a report that multiple suitors are considering bids to purchase the biotech company.

WHAT’S NEW

GlaxoSmithKline (GSK) may be joining Gilead (GILD) and Novartis (NVS) in the race to buy United Therapeutics, which develops pulmonary arterial hypertension treatments, The Evening Standard reported.

Glaxo, which is thought to be being advised by Lazard and Citi, would face “stiff competition,” according to the report, as Gilead is thought to be the frontrunner.

Emma Walmsley, who became Glaxo’s CEO in April, said she is seeking smaller acquisitions of United’s size, but the company has also suggested it is looking to shift out of rare diseases. United could fetch up to $200 per share, or about $8.7B in total, the report said.

PRICE ACTION

United Therapeutics (UTHR) are up 7.6% to $136.68 in Friday afternoon trading.

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Exelixis to Present Data on its Cancer Drugs

The European Society for Medical Oncology Congress will be held in Madrid, September 8 – 12, 2017.

 

Exelixis says to present data from cabozanitinib, cobimetinib at ESMO

 

 Exelixis says to present data from cabozanitinib, See Stockwinners.com Market Radar to read more

Exelixis (EXEL) says to present data from #cabozanitinib, cobimetinib at ESMO Exelixis announced that data from clinical trials of cabozantinib and cobimetinib will be the subject of 10 presentations at the European Society for Medical Oncology 2017 Congress in Madrid, September 8 – 12, 2017.

Progression-free survival by independent radiology review and updated overall survival results from CABOSUN, a randomized phase 2 clinical trial of cabozantinib compared with sunitinib in patients with previously untreated advanced renal cell carcinoma, will be presented as a late-breaking abstract in the Genitourinary Tumours, Non-Prostate poster discussion session on Sunday, September 10.

Final data from the phase 1 study of cabozantinib in combination with nivolumab with or without ipilimumab for the treatment of metastatic urothelial carcinoma and other genitourinary malignancies will be presented in the Genitourinary Tumours, Non-Prostate oral presentation session on Saturday, September 9.

Additionally, poster presentations will detail the evaluation of cabozantinib in RCC and advanced penile squamous cell carcinoma, and of cobimetinib in combination studies in metastatic #melanoma.

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AstraZeneca receives $8.5 Billion from Merck

AstraZeneca receives $1.6B upfront in oncology collaboration with Merck

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AstraZeneca (AZN) and Merck (MRK) announced that they have entered a global strategic oncology collaboration to co-develop and co-commercialise AstraZeneca’s Lynparza for multiple cancer types.

#Lynparza is an oral poly ADP ribose polymerase, or PARP, inhibitor currently approved for BRCA-mutated #ovarian cancer in multiple lines of treatment.

The companies will develop and commercialize Lynparza jointly, both as monotherapy and in combination with other potential medicines.

Independently, the companies will develop and commercialise Lynparza in combination with their respective PD-L1 and PD-1 medicines, Imfinzi and Keytruda.

The companies will also jointly develop and commercialize AstraZeneca’s selumetinib, an oral, potent, selective inhibitor of MEK, part of the mitogen-activated protein kinase pathway, currently being developed for multiple indications including thyroid cancer. Under the terms of the agreement, AstraZeneca and Merck will share the development and commercialization costs for Lynparza and selumetinib monotherapy and non-PD-L1/PD-1 combination therapy opportunities.

Gross profits from Lynparza and selumetinib Product Sales generated through monotherapies or combination therapies will be shared equally.

Merck will fund all development and commercialization costs of Keytruda in combination with Lynparza or selumetinib. AstraZeneca will fund all development and commercialization costs of #Imfinzi in combination with Lynparza or selumetinib. AstraZeneca will continue to manufacture Lynparza and selumetinib.

As part of the agreement, Merck will pay AstraZeneca up to $8.5B in total consideration, including $1.6B upfront, $750M for certain license options and up to $6.15B contingent upon successful achievement of future regulatory and sales milestones.

Under the terms of the agreement, AstraZeneca anticipates approximately $1B to be recorded under Externalization Revenue in 2017.

OTHER EVENTS

AstraZeneca plunged in pre-market trading as Phase III MYSTIC trial endpoint not met. AstraZeneca announced progression-free survival results for the Phase III #MYSTIC trial, a randomized, open-label, multi-center, global trial of Imfinzi monotherapy or Imfinzi in combination with tremelimumab versus platinum-based standard-of-care chemotherapy in previously-untreated patients with metastatic 1st-line non-small cell lung cancer.

MYSTIC TRIAL:

AstraZeneca has announced progression-free survival, or PFS, results for the Phase III MYSTIC trial, which is testing Imfinzi monotherapy or Imfinzi in combination with tremelimumab versus platinum-based standard-of-care chemotherapy in previously-untreated patients with metastatic first line non-small cell lung cancer.

The combination did not meet the primary endpoint of improving PFS compared to standard-of-care in patients whose tumors express PD-L1 on 25% or more of their cancer cells.

PRICE ACTION

In Thursday’s trading, shares of AstraZeneca have dropped over 15% to $28.72, while Bristol’s (BMY) stock has slipped almost 5% to $53.23. MYSTIC trial failure is a negative read-through for Bristol-Myers’ combo of Opdivo + Yervoy in the ongoing CheckMate-227 trial.

Meanwhile, Merck is up over 3% to $63.75.

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Watch Tetraphase!

Tetraphase announces positive top-line results from Phase IGNITE4 trial

Tetraphase announces positive top-line results from Phase3. See StockwinnersTetraphase Pharmaceuticals (TTPH) announced positive top-line results from #IGNITE4, the company’s phase 3 clinical trial evaluating the efficacy and safety of twice-daily intravenous #eravacycline compared to meropenem for the treatment of patients with complicated intra-abdominal infections.

Tetraphase Pharmaceuticals, Inc. develops various antibiotics for the treatment of serious and life-threatening multidrug-resistant infections. Its lead product candidate is eravacycline, an intravenous and oral antibiotic for use as a first-line empiric monotherapy to treat resistant and multidrug-resistant infections, including multidrug-resistant Gram-negative infections.

Meropenem, sold under the brandname Merrem among others, is an broad-spectrum antibiotic used to treat a wide variety of infections.

It gained US FDA approval in July 1996. It was initially marketed by AstraZeneca (AZN). It is on the World Health Organization’s List of Essential Medicines, the most effective and safe medicines needed in a health system.

Noninferiority trials are intended to show that the effect of a new treatment is not worse than that of an active control by more than a specified margin.

The results of #IGNITE4, which enrolled 500 patients, demonstrated statistical non-inferiority of eravacycline to meropenem for the primary efficacy endpoint of clinical response at the test-of-cure visit.

Noninferiority trials are intended to show that the effect of a new treatment is not worse than that of an active control by more than a specified margin.

PRICE RANGE

TTPH closed Tuesday’s trading at $6.90. It traded as high of $8.72 in extended trading. Shares have a 52-weeks trading range of $3.11 – $9.93.

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India Approves Anika Therapeutics’ Treatment for Osteoarthritis Pain

Anika Therapeutics says Monovisc approved in India

Anika Therapeutics says Monovisc approved in India. See Stockwinners.com Market Radar for Stock Upgrades, stock downgrades, stock earnings, stocks to watch

Anika Therapeutics (ANIK) announced that regulatory authorities in India granted approval to MONOVISC, its single injection viscosupplement for the treatment of pain associated with osteoarthritis of all human synovial joints.

#MONOVISC is commercially available in the United States, Canada and Europe, and Anika plans to expand into India, Australia, New Zealand and additional international markets over the next six to nine months.

“Expanding our global commercial footprint is one of our key strategic pillars of growth, and the approval of MONOVISC in India is a proof point for our ability to execute against the benchmarks we define each year,” said Charles H. Sherwood, Ph.D., President and Chief Executive Officer of Anika Therapeutics.

“There is a growing demand for non-invasive, long-acting treatments for osteoarthritis in emerging countries such as India where knee replacement surgery is often the last option or not an option at all, due to limited medical resources outside major cities and high costs of surgery and postsurgical care.

With its ability to safely relieve pain for up to six months with fewer office visits, lower treatment costs and no downtime after treatment, MONOVISC is poised to be well-received by physicians and patients in India.”

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Nektar Gets $150 Million from Eli Lilly

Eli Lilly and Nektar announce collaboration to develop NKTR-358

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Eli Lilly and Company (LLY) and Nektar Therapeutics (NKTR) have announced a strategic collaboration to co-develop NKTR-358, a novel immunological therapy discovered by Nektar.

NKTR-358, which achieved first human dose in Phase 1 clinical development in March, has the potential to treat a number of autoimmune and other chronic inflammatory conditions.

Under the terms of the agreement, Nektar will receive an initial payment of $150M and is eligible for up to $250M in additional development and regulatory milestones.

The parties will share Phase 2 development costs 75% Lilly and 25% Nektar.

Nektar will have the option to participate in Phase 3 development on an indication-by-indication basis.

Nektar has the opportunity to receive double-digit royalties that increase commensurate with their Phase 3 investment and product sales. Lilly will be responsible for all costs of global commercialization.

Nektar will have an option to co-promote in the U.S. under certain conditions. This transaction is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions.

Lilly expects to incur an acquired in-process research and development charge to earnings in 2017 of approximately 9c per share. The company’s reported EPS guidance in 2017 is expected to be reduced by the amount of the charge. There will be no change to the company’s non-GAAP EPS guidance as a result of this transaction.

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NeuroDerm Sold for $1.1 Billion Cash

NeuroDerm agrees to be acquired by Mitsubishi Tanabe Pharma for $39 a share

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NeuroDerm (NDRM) announced that it has signed a definitive agreement under which Mitsubishi Tanabe Pharma will acquire NeuroDerm for $39 per share in cash.

The transaction has received unanimous approval by NeuroDerm’s board and implies an equity value of approximately $1.1B.

NeuroDerm Ltd. engages in developing drug-device combinations for the treatment of central nervous system (CNS) disorders. The company’s levodopa and carbidopa (LD/CD) product candidates, which have completed Phase IIa clinical trial, include ND0612L and ND0612H for the treatment of patients with moderate and advanced Parkinson’s disease.

The offer of $39 per share in cash represents a premium of 79%over the unaffected price on June 9 of NeuroDerm’s ordinary shares on the Nasdaq Stock Market and a 17% premium over the closing stock price on July 21.

A special meeting of shareholders to approve the transaction is expected to be held this fall. Assuming typical regulatory and shareholder approval timeframes, NeuroDerm currently anticipates the transaction will close in Q4.

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