Celldex (CLDX) recently reported interim data from their ongoing, open label clinical trial of CDX-0159; we believe the severe sell-off following this report was an overreaction, suggests John McCamant, editor of The Medical Technology Stock Letter.
The clinical trial was in patients with antihistamine refractory cold contact urticaria (ColdU) and symptomatic dermographism (SD), the two most common forms of chronic inducible urticaria (CIndU).
CDX-0159 showed amazing efficacy of 90%. In all patients treated and assessed for at least 15 days after treatment (n=10), 8 of 10 patients (80%) experienced a complete response (CR) to provocation testing post-treatment and one patient experienced a partial response (PR) — for a total response of 90%.
This is a very impressive percentage of complete responders in refractory patients — they were very active patients with high disease activity that have not responded to Xolair treatment. Further patient updates are due later in Q2:21.
Six of 15 patients had mild infusion reactions, generally areas of localized redness and itching, which resolved rapidly. A single severe infusion reaction was observed (brief loss of consciousness — fainted — followed by shaking and sweating).
The patient was treated with antihistamines and steroids; no epinephrine was administered. The patient rapidly recovered and was hospitalized for observation with no further manifestations of this event.
The stock has overacted as in a very negative biotech tape investors sell first and ask questions later. In our view, ‘0159 is a very active drug that has potential to best in class as it binds extremely well to its target, mast cells.
The sub-q formulation has advantages over IV delivery including both safety and much easier to use at home that traveling to a clinic/hospital.
With exceptional efficacy in the first urticaria patient study, CDX-159 has sizable potential as a treatment for mast cell diseases. In fact, the company announced a third urticaria indiction today.
We believe the severe reaction creates an overreaction in a stock that until has held well until today in a very bad biotech tape — ending the third quarter.
We would use take advantage of the weakness to initiate or add to positions as we now have de-risked the drug’s potential in the first large mast cell condition, with several more on the way. We rate the stock a buy under $20 with a target price of $30.
