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Here's Why Nektar Stock Skyrocketed Almost 500% in a Year

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Shares of Nektar Therapeutics (NKTR - Free Report) have increased a massive 483.7% in a year’s time, substantially outperforming the industry’s gain of 11.9%. Let’s analyze the factors that led to this massive rally.

Nektar’s rapid progress on a robust pipeline in a year accompanied with several study initiations, positive readouts and strategic collaborations has driven its share price consistently.

The company’s PEGylation technology also facilitated development of several approved products in the United States and the EU through partnerships with healthcare companies namely AstraZeneca's (AZN - Free Report) Movantik, UCB’s Cimzia and Amgen's (AMGN - Free Report) Neulasta, among others.

Furthermore, it has a robust pipeline of early and late-stage candidates. Nektar has made a significant progress with its lead candidate Onzeald (formerly known as NKTR-102), which is currently under accelerated assessment in the EU, for treating adults with advanced breast cancer as well as brain metastases. A response is anticipated within the first half of 2018.

Meanwhile, a randomized phase III confirmatory study (ATTAIN) began on Onzeald, late last year. The study compares Onzeald with the single-agent chemotherapy of physician’s choice on patients with advanced breast cancer having brain metastases of late. Positive results from the program are likely to support a regulatory filing in the United States.

Apart from Onzeald, Nektar is working on developing other candidates. In September 2017, the company announced initiation of phase I/II PROPEL study to evaluate the efficacy and safety of its immuno-oncology candidate, NKTR-214, in combination with Roche’s Tecentriq (atezolizumab) and Merck's (MRK - Free Report) Keytruda (pembrolizumab).

A phase I/II PIVOT study, evaluating NKTR-214 as a potential combination treatment regimen with Bristol-Myers Squibb’s Opdivo, is also underway across five tumor types (melanoma, kidney, colorectal, bladder and non-small cell lung cancer) and eight potential indications.

In November 2017, the company announced positive data from PIVOT study for treating patients with melanoma, renal cell carcinoma and non-small cell lung cancers.

Also, Nektar entered into a research collaboration with Takeda Pharmaceuticals to explore the combination of NKTR-214 with five oncology compounds from Takeda’s cancer portfolio in May 2017.

Another candidate, NKTR-181, is being examined in a phase III program for treatment of chronic pain. In July 2017, the company reported positive top-line findings from an oral human abuse potential study, analysing NKTR-181, to assess the opioid abuse potential compared with oxycodone. It is planning to submit a new drug application for the candidate by April 2018.

In March 2017, the company initiated a phase I clinical study, evaluating NKTR-358, to treat a wide range of auto-immune diseases and inflammatory disorders.

Subsequently, in July 2017, Nektar sealed a co-development deal with Elly Lilly and Company for NKTR-358. Pursuant to this agreement, the company will own responsibility for completing the ongoing phase I study on the candidate. Both the companies will share phase II development costs with Lilly acquiring the lion share (75%) of the total expenses.

This year looks extremely favorable for the stock with several updates lined up. The expected approval of Onzeald in the EU for breast cancer and the submission of NDA for NKTR-181 should act as a catalyst to further drive the stock in 2018.

Zacks Rank

Nektar carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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