Myovant Sciences Ltd (MYOV)

[stockguard]

Myovant Presses Forward After Latest Positive Trial; Multiple Catalysts Loom
Dec. 21, 2019 11:18 AM ET|12 comments | About: Myovant Sciences Ltd. (MYOV)
Terry Chrisomalis
Biotech Analysis Central
Actionable ideas on small-large cap biotech stocks through deep analysis.
(7,817 followers)

Summary

Myovant achieved positive results from its phase 3 HERO study in which the study met on the primary endpoint and all key secondary endpoints for those with advanced prostate cancer.

There were 96.7% of men with advanced prostate cancer patients who had sustained testosterone suppression to castrate levels through 48 weeks.

Based on the positive data from the phase 3 HERO study, the company intends to file an NDA to the FDA for relugolix by Q2 of 2020.

Additional catalysts are approaching in the 1st half of 2020, which, if positive, could cause the stock to trade higher.

This idea was discussed in more depth with members of my private investing community, Biotech Analysis Central. Get started today »

Myovant Sciences (MYOV) is a biotech that should be on everyone's radar. That's because it has been able to achieve positive results in several indications, with the most recent positive results coming out of the HERO study using relugolix to treat men with advanced prostate cancer. This late-stage study had met on the primary endpoint, which will allow the company to file an NDA to the FDA for eventual approval for this indication by Q2 of 2020. In addition, there are several other catalysts that are anticipated in the 1st half of 2020. These involve several trial readouts and potential regulatory filings. With all these catalysts, I view Myovant Sciences as a strong buy.

Relugolix Achieves Positive Data For Advanced Prostate Cancer
Myovant had used its drug relugolix in its late-stage study to treat patients with advanced prostate cancer. Prostate cancer occurs in a man's prostate, which produces the seminal fluid that nourishes and transports sperm. It is estimated that there are about 3 million U.S. cases per year for this type of cancer. It is imperative that additional treatment options exist for these patients. That's because it is the second-leading cause of cancer death for men in the United States. It is estimated that global prostate cancer market could reach $12 billion by 2025.

The positive results, in which the primary endpoint was met, came from the phase 3 HERO study. Specifically, the study was looking at men who had androgen-sensitive advanced prostate cancer. What is so important to know about these patients? First thing to know is that androgen-sensitive means that the prostate cancer in question relies on high levels of androgens to grow. Therefore, decreasing androgen levels should in turn keep the cancer from spreading. Which brings me to the second item that must be known about these patients. They were required to take at a minimum 1 year of continuous androgen deprivation therapy (ADT). Patients were dosed in either one of two dosing groups. One group of patients were randomized to take a single loading dose of 360 mg of relugolix followed by 120 mg of relugolix once daily. The other group of patients took leuprolide acetate (3-month injection). The primary endpoint of this phase 3 HERO study looked to see the percentage of men that were able to obtain sustained testosterone suppression to castrate levels of < 50 ng/dL through 48 weeks. As I highlighted in the introduction above, about 96.7% of men had sustained testosterone suppression to castrate levels through 48 weeks. Not only that, but those treated with relugolix achieved all 6 secondary endpoints with p-values <0.0001.

These positive results just achieved mark an important turning point for the biotech. Especially, since as I described above this is a multi-billion dollar market opportunity. But there is a catalyst to capitalize on that could also cause another boost for the stock with respect to this program. Myovant expects that it will file its NDA submission for relugolix for the treatment of patients with advanced prostate cancer in Q2 of 2020. Additional catalysts would be other regulatory submissions expected in the future for Europe and Japan. However, I don't expect regulatory applications to be filed in these territories right away. I think the biotech will be more focused on getting the NDA in to the FDA first before worrying about other territories.

Additional Catalysts May Provide Significant Upside
Besides the potential regulatory filing of relugolix for the treatment of men with advanced prostate cancer, there are many other catalysts expected in the early part of 2020. The first of which is 12-month safety data from the LIBERTY open-label extension study using the relugolix combination therapy for the treatment of women with uterine fibroids and heavy menstrual bleeding. This data is expected in the company's first quarter calendar year of 2020. This will be bioequivalence data. This type of data, along with the positive results from LIBERTY-1 and LIBERTY-2, are expected to be used as part of the NDA filing to the FDA for relugolix combination therapy expected by April of 2020. However, the marketing authorization application (MAA) for the combination therapy in treating this very same patient population is expected earlier by Q1 of 2020. On top of that, there are trial readouts from two other late-stage studies expected in the 1st half of 2020. This will be data from two phase 3 studies known as SPIRIT-2 and SPIRIT-1, respectively. Both of these studies are exploring a relugolix combination therapy to treat women with endometriosis pain. Many of these catalysts are approaching in the coming months and might provide significant upside for the stock.

Financials

According to the 10-Q SEC filing, Myovant Sciences had $157.6 million as of September 30, 2019. That is a decent amount of cash, but there is extremely good news even on the financing front. Myovant has a term loan facility it is expecting to get from Sumitomo Dainippon Pharma. This is a deal between Myovant's parent company (Roivant Sciences) with Sumitomo. Myovant will obtain $350 million in capital to fund all the products in the pipeline based on this deal. It is good news that it has already secured such a large amount of cash. This means investors won't have to worry about any cash raises in the near-term.

Risks

With many catalysts approaching for Myovant, it's important to highlight that there are several risks. The first of which is that there is no guarantee that all the upcoming trial readouts expected in the 1st half of 2020 will be successful. Any clinical study that doesn't meet expectations may cause the stock to dip in the short term. Not only that, but even if NDAs are filed for relugolix in a few of the indications note above, like uterine fibroids and advanced prostate cancer, there is no guarantee that relugolix will be approved for one or both indications. Still, Myovant has a solid pipeline and has another product known as MVT-602 to help women undergoing assisted reproduction, including in vitro fertilization (IVF). This is another product in the pipeline that may yield value for shareholders.

Conclusion

The positive results obtained in the phase 3 HERO study will allow Myovant to file its NDA by Q2 of 2020. This will allow the biotech to treat men with advanced prostate cancer who are androgen-sensitive. Prostate cancer is a multibillion dollar market opportunity and I believe that the biotech can capture a large chunk of this space. The other indications in the pipeline targeting endometriosis and uterine fibroids are also multibillion dollar markets. This will allow the company to be diversified into several key areas for growth. With so many catalysts on the way, I believe that Myovant is set up for potential success in the coming months. That's why I believe it is a strong buy.

This article is published by Terry Chrisomalis, who runs the Biotech Analysis Central pharmaceutical service on Seeking Alpha Marketplace. If you like what you read here and would like to subscribe to, I'm currently offering a two-week free trial period for subscribers to take advantage of. My service offers a deep-dive analysis of many pharmaceutical companies. The Biotech Analysis Central SA marketplace is $49 per month, but for those who sign up for the yearly plan will be able to take advantage of a 33.50% discount price of $399 per year.

https://seekingalpha.com/article/4313662-myovant-presses-forward-after-latest-positive-trial-multiple-catalysts-loom