Liquid Biopsy · @Liquid_Biopsy
24th Jul 2015 from TwitLonger
$CYCC AML phase3 related: UBS on $SNSS Sell with $1.50
Regulatory Update Suggests Potential Path Forward
in EU, Headwinds in the US
Conclusions: Still cautious after regulatory update
Management today provided an update on ongoing regulatory discussions in both the
U.S. and Europe with EMA suggesting a path forward while the FDA appears more
cautious, requesting additional clinical data before a vosaroxin filing in the U.S. As
expected the EU filing will focus on the >60yrs subset. Notably, while we do believe
vosaroxin has potential for EU approval based on the positive subset data and approval
history for similar mixed trial results (eg Dacogen), we do believe the questions likely
raised by FDA should also be relevant for EMA reviewers and continue to suggest
regulatory risk to a favorable outcome. While we believe there is a clear unmet need for
r/rAML patients, we reiterate our cautious outlook on SNSS and await further detail on
EU regulatory timing and financing risk.
Key points from the update
[1] FDA feedback suggested the need for additional clinical data before filing. While
EMA Rapporteurs appear to have encouraged the company to file, we believe similar
questions and concerns to FDA will still come up and continue to view meaningful
regulatory risk to the program. A pre-submission meeting with the EMA has been
scheduled in the fall, and the company expects a reasonably swift submission process
following this meeting ("should not take years"). [2] No decision has been reached
whether commercialization in EU will be carried out as do it alone or in partnership,
albeit management has emphasized that there is interest in partnering in EU. [3]
Management reiterated having sufficient cash through mid-2016, although we
continue to view meaningful financing risk given uncertain regulatory timelines.
Implications: Awaiting further clarity on timing, burn rate
We look to 2Q results to get additional clarity on potential timing of the submission
and review process as well as the impact to burn and cash guidance. We expect near
term volatility until these concerns are better understood.
Valuation: Sell with $1.50 price target by DCF and SOTP methodology
Our price target assumes risk-adjusted sales in both the US and EU.