Something is happening with Northwest Biotherapeutics, Inc (OTCMKTS:NWBO) and – while many opinions are being thrown around – nobody really knows exactly what it is. The company traded for $0.16 a share at the end of June and spent the first two weeks of July appreciating slowly towards $0.18 apiece. Between July 11 and the Thursday close this week, July 13, Northwest ran from $0.18 to current levels at $0.25 a share.
That is a close to 40% run in a matter of days.
While, as noted, the driver behind this one remains unclear, there are a couple of suggestions that stand out above the rest as being likely responsible. Here is our take on the situation and what we’re looking for next as confirmatory of our opinions.
For those new to this one and by way of a quick introduction, Northwest is developing a portfolio of immunotherapy treatments targeting various forms of cancer. Its lead indication is glioblastoma multiforme (GBM), which is a common and aggressive form of brain cancer. The current standard of care in the space is chemotherapy and surgical resection but, even with this treatment, expected survival is measured in months not years. The lead asset with which Northwest is targeting this form of the disease is called DCVax-L and the drug has had a rocky development pathway to put it lightly.
Anyway, we’re not going to go into that in any detail in this piece. Readers looking to get a detailed background on what is happening can check out our previous coverage of the stock here.
So, we see only two real possibilities as contenders for being the driving factor behind the recent action.
The first is rooted in a recent Novartis AG (ADR) () development.
Earlier this week, the company announced that an FDA advisory panel had voted unanimously in favor for approval of a CAR-T asset called CTL019 as a treatment for pediatric and young adult patients with relapsed and refractory B-cell acute lymphoblastic leukemia (ALL).
This is the first time a drug of this type has got this close to approval and – as perhaps might be expected – it is making waves in the wider sector.
Companies developing similar type assets (that is, immunotherapy type assets) are picking up some collateral benefit on the idea that the FDA is warming to immunotherapy assets as a whole (perhaps more accurately as relates to NWBO, personalized immunotherapy type treatments) and this is translating to some sector wide strength. It’s reasonable to suggest, therefore, that – based on the mechanism of action of DCVax-L and it’s alternative formulations across Northwest’s remaining pipeline – markets are buying up Northwest in response to the Novartis news.
Reasonable, yes. To suggest that the entirety of this run is based on immunotherapy driven sentiment, however, is a bit of a stretch.
So, what might account for the rest of the action?
Well, markets are poised to receive data from the company’s lead program, a phase 3 investigation into the efficacy of DCVax-L in the above noted GBM indication. The trial has dragged on a bit, but only because patients are living longer than expected, and the company is unable to unblind the data before a predefined number of events take place.
These events are defined as patient deaths, so while their reaching is a bittersweet development, it’s a highly anticipated one. The word is at the moment is that the company is waiting for two more events (deaths) to take place before it can consider the trial event count met.
There is speculation, then, that these deaths have occurred, and that the unblinding of the data is just around the corner. If this proves to be true, and in our opinion it is not unreasonable speculation, then the recent would make sense. Not only that, but as and when the data hits press, we are almost certainly going to see further appreciation if the numbers read out as positive.
Learn the whole story: check out our previous coverage here.
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Image courtesy of Lelde Suksta via Flickr
Disclosure: We have no position in NWBO and have not been compensated for this article.