PropThink: Tivozanib and AVEO: Valuation Suggests Upside Ahead of FDA Decision
(Thomson Reuters ONE) -
It seems that shares of AVEO Oncology (NASDAQ:AVEO) may have finally found their
bottom. The oncology drug-developer bounced off of support at $6 (a triple
bottom) early this week before beginning a brief uptrend, in-part fueled by
insider buying last week. More importantly in the long-run, however, the FDA has
accepted AVEO's New Drug Application for tivozanib, a potential first-line
treatment for Renal Cell Carcinoma (RCC), and set a July 28, 2013 PDUFA date for
the VEGF inhibitor. Notably, tivozanib outperformed its potential competitor
Nexavar (sorafenib) in the Phase III TIVO-1 study, which reported data earlier
this year and compared the Progression Free Survival (PFS) benefit of the two
drugs. But a secondary, arguably more important endpoint, Overall Survival (OS),
proved a miss, as slightly more patients on tivozanib had passed away after one
year. AVEO shares declined from $17 early this year to around $6 in November, an
all-time low for the stock and a clear sign that expectations for tivozanib have
gotten progressively worse following the survival data. Additionally, short
interest in the stock climbed three-fold since March. What was once a high-
expectation play in the oncology space has turned into a chancier investment as
trial results proved less decisive than expected and FDA sentiment remains
unclear. But if AVEO reports rosier OS data in February and tivozanib receives
FDA approval in mid-2013, investors will see quality returns. The chances of
approval, we believe, are good based on the FDA's acceptance of PFS as an
endpoint in past oncology treatments (cabozantinib for instance), and the
question of long-term success will then fall to tivozanib's marketability. We
expect interest in AVEO to continue to increase in 1Q13 as a number of events
approach - namely, pivotal OS data presentation in February - with trading
peaking ahead of the mid-2013 FDA action date. With shares near their 52-week
lows and the market largely discounting tivozanib's approval and success, AVEO
stands a good chance of delivering returns.
Mixed results raise questions for Tivozanib's prospects. Tivozanib's efficacy
will come under close scrutiny as it enters the review process, and although the
FDA has not yet announced involvement from the Oncologic Drugs Advisory
Committee, it seems likely considering tivozanib's mixed data. In the Phase 3
TIVO-1 trial, pitting tivozanib against the approved first-line RCC treatment
sorafenib, tivozanib demonstrated a median PFS of 11.7 months compared to
sorafenib's 9.1 (HR of 0.797, P=0.042). In a subset of treatment-naive patients
(70% of total), tivozanib demonstrated a median PFS of 12.7 months vs. 9.1 for
sorafenib (HR 0.756, P=0.037). While a statistically significant improvement,
investors and the FDA have instead focused on the 77% of tivozanib patients who
achieved one year OS, compared to the 88% of sorafenib patients who did the
same. The FDA subsequently communicated that the OS data will be a concern going
into the review process, and these issues have pressured the stock in the second
half of 2012.
AVEO explains the OS results from TIVO-1 as a result of crossover between the
two arms of the trial, a valid element that could certainly confound Overall
Survival data. In the trial, 53% of Nexavar patients went on to receive
subsequent therapy, primarily with tivozanib, while only 17% of patients treated
with tivozanib followed with supplementary therapy. The benefit from multiple
treatments are obvious, and certainly may have impacted the results.
Additionally, says the company, not enough patients in the 517-patient trial had
passed away at the time of the data release to properly determine a mature
median OS figure. Continue reading.
See "Tivozanib and AVEO: Valuation Suggests Upside Ahead of FDA Decision" at
PropThink.com.
About PropThink
PropThink is an intelligence service that delivers long and short trading ideas
to investors in the healthcare and life sciences sectors. Our focus is on
identifying and analyzing technically-complicated companies and equities that
are grossly over or under-valued. We offer daily market coverage, weekly feature
stories, and a newsletter to investors who subscribe on PropThink.com. To learn
more, follow us on Twitter or visit us at http://www.propthink.com.
Disclaimer:
You should assume that as of the publication date of any report or letter,
PropThink, LLC and persons or entities with whom it has relation ships
(collectively referred to as "PropThink") has a position in all stocks (and/or
options of the stock) covered herein that is consistent with the position set
forth in our research report. Following publication of any report or
letter, PropThink intends to continue transacting in the securities covered
herein, and we may be long, short, or neutral at any time hereafter regardless
of our initial recommendation. To the best of our knowledge and belief, all
information contained herein is accurate and reliable, and has been obtained
from public sources we believe to be accurate and reliable, and not from company
insiders or persons who have a relationship with company insiders. PropThink was
not compensated to publish this article. Our full disclaimer is available
at http://www.propthink.com/disclaimer.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: PropThink via Thomson Reuters ONE
[HUG#1667552]
Unternehmensinformation / Kurzprofil:
Datum: 28.12.2012 - 18:18 Uhr
Sprache: Deutsch
News-ID 215868
Anzahl Zeichen: 6332
contact information:
Town:
New York
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 261 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"PropThink: Tivozanib and AVEO: Valuation Suggests Upside Ahead of FDA Decision"
steht unter der journalistisch-redaktionellen Verantwortung von
PropThink (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
