Stockwatch: What Glimmer Through Yonder Gloom Breaks?
As Brexit-induced volatility continued to reverberate across the stock market last week, investment bank analysts started to downgrade companies by lowering their full-year earnings estimates. The prospects for second-quarter earnings season could have not have looked bleaker. Then paradoxically, at the end of the week, a clinical hold on a breakthrough biotechnology company product provided a glimmer of hope in the sector.
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News in the life sciences sector over the holiday period was peppered with clinical and regulatory failures at Acadia, Anthera, Opko and Cempra, and a drug pricing controversy from Biogen. Following underperformance in 2016 and with that sort of run-up, 2017 already looks likely to be another lost one.
Juno Therapeutics Inc. planned to win US FDA approval in 2017 for its chimeric antigen receptor T cell (CAR-T) cell therapy JCAR015, but the company has reached another significant milestone that may delay that goal: its Phase II ROCKET clinical trial in the treatment of adults with relapsed or refractory B cell acute lymphoblastic lymphoma (ALL) has been put on clinical hold due to three deaths.
Salix Pharmaceuticals lost 38.3% of its recently rising value – chopping more than $3bn from its market cap – after the stock market closed on 6 November following the immediate resignation of the company's chief financial officer and Salix's admission that an audit of its inventory levels is ongoing.