GenVec Inc (fka GNVC)

[peewee]

Hearing Loss Could Be A Win For GenVec
Madalina Iacob, 03.30.10, 03:15 PM EDT
Biopharma's shares plummet after it discontinues cancer drug trial but analyst still sees upside.



GenVec, Inc.04/12/2010 4:00PM ET$0.76$0.057.04%
At A GlanceChartNewsPeople
Full GNVC Chart at
Novartis AG04/12/2010 4:00PM ET$53.48$0.370.70%
At A GlanceChartNewsPeople
Full NVS Chart at
BATS Real-Time Market Data by XigniteA failed trial on a pancreatic cancer drug sucked the life out of GenVec shares Tuesday, but the steep decline may be setting up an attractive entry point for investors if a separate collaboration with Novartis works out.

GenVec ( GNVC - news - people ) shares plunged as low as 71 cents early in the session and were down 72%, or $2.02, to 78 cents with an hour to the close after the company announced it is shelving a Phase 3 clinical trial for TNFerade in patients with pancreatic cancer.

Article Controls
email

print

reprint

newsletter

comments

share

del.icio.us

Digg It!

yahoo

Facebook

Twitter

Reddit

rss

Yahoo! Buzz"We are disappointed with data, particularly given the lack of adequate treatments for pancreatic cancer," said Paul Fischer, Ph.D., the CEO of GenVec. "As our shareholders know in addition to TNFerade our research consists of a number of funded vaccine programs. We will continue to focus on those programs and supporting our collaboration with Novartis ( NVS - news - people ) to develop treatments for hearing loss."

Discontinuing the TNFerade trial will slow down the rate at which GenVec burns through the $38 million in cash on its balance sheet, and Nathan Cali, an analyst with Noble Financial Capital Markets, thinks the $213.6 million partnership with Novartis could pay off and is advising clients to buy GenVec shares at their newly reduced price.

The deal with Novartis, sealed in early 2010, gives the pharmaceutical heavyweight global rights to GenVec's preclinical hearing loss and balance disorders programs.

Cali acknowledges that there is a substantial risk involved in the program, but even with only a 15% chance of clinical success, the opportunity in the $4.5 billion hearing loss market--where the industry standard is hearing aids and not pharmaceuticals--GenVec shares could get a major boost if the treatment can show encouraging results in early-stage trials.

Rate This Story
Your Rating
Overall Rating
Reader Comments
Post a Comment


http://www.forbes.com/2010/03/30/genvec-trial-novartis-markets-equities-cancer.html?partner=alerts