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Merrimack (MACK) Drops as Breast Cancer Drug Trial Stops
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Shares of Merrimack Pharmaceuticals, Inc. (MACK - Free Report) tanked 18.4% after the company announced the discontinuation of a phase II trial on its breast cancer candidate, MM-302.
We note that Merrimack has underperformed the Zacks classified Medical Biomed/Genetics industry in the year-to-date period. In fact, the stock has lost 44.6% during this period, compared with a drop of 25.4% for the industry.
The decision was taken following the recommendation and a subsequent futility analysis by an independent Data and Safety Monitoring Board (DSMB).
MM-302 is being evaluated for the treatment of HER2-positive metastatic breast cancer in patients who were previously treated with trastuzumab (Herceptin), pertuzumab (Perjeta) and ado-trastuzumab emtansine (T-DM1, Kadcyla).
The DSMB recommended that the continuation of the trial is unlikely to demonstrate benefit over the comparator treatments. A subsequent futility assessment confirmed the DSMB's opinion as both the treatment and control arms were found to have shorter-than-expected median progression-free survival.
Merrimack will provide further details on the study in January, along with a review of its pipeline.
Our Take
The news is surely disappointing for investors. Merrimack currently has only one marketed product in its portfolio, Onivyde. Onivyde is approved in the U.S., for use in combination with fluorouracil (5-FU) and leucovorin (LV), for the treatment of patients with metastatic adenocarcinoma of the pancreas after disease progression following Gemzar (gemcitabine)-based therapy. With only one approved product in its portfolio, Merrimack is heavily dependent on Onivyde for growth.
Thus, successful development of other candidates in its pipeline is critical for Merrimack’s growth prospects.
However, competition is stiff in the breast cancer space. We remind investors that Roche (RHHBY - Free Report) dominates this market on the back of strong demand for its HER2 franchise, which includes drugs like Herceptin, Perjeta and Kadcyla.
Heska’s earnings estimates increased from $1.13 to $1.35 for 2016 and from $1.38 to $1.53 for 2017 over the last 60 days. The company posted a positive earnings surprise in all of the four trailing quarters with an average beat of 301.64%. Its share price has increased 93.6% year to date.
Vanda’s loss estimates for 2016 narrowed from 62 cents to 52 cents, while its earnings estimates for 2017 increased from 13 cents to 22 cents over the last 60 days. The company posted a positive earnings surprise in three of the four trailing quarters with an average beat of 56.65%. Its share price has surged almost 74.1% year to date.
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Merrimack (MACK) Drops as Breast Cancer Drug Trial Stops
Shares of Merrimack Pharmaceuticals, Inc. (MACK - Free Report) tanked 18.4% after the company announced the discontinuation of a phase II trial on its breast cancer candidate, MM-302.
We note that Merrimack has underperformed the Zacks classified Medical Biomed/Genetics industry in the year-to-date period. In fact, the stock has lost 44.6% during this period, compared with a drop of 25.4% for the industry.
The decision was taken following the recommendation and a subsequent futility analysis by an independent Data and Safety Monitoring Board (DSMB).
MM-302 is being evaluated for the treatment of HER2-positive metastatic breast cancer in patients who were previously treated with trastuzumab (Herceptin), pertuzumab (Perjeta) and ado-trastuzumab emtansine (T-DM1, Kadcyla).
The DSMB recommended that the continuation of the trial is unlikely to demonstrate benefit over the comparator treatments. A subsequent futility assessment confirmed the DSMB's opinion as both the treatment and control arms were found to have shorter-than-expected median progression-free survival.
Merrimack will provide further details on the study in January, along with a review of its pipeline.
Our Take
The news is surely disappointing for investors. Merrimack currently has only one marketed product in its portfolio, Onivyde. Onivyde is approved in the U.S., for use in combination with fluorouracil (5-FU) and leucovorin (LV), for the treatment of patients with metastatic adenocarcinoma of the pancreas after disease progression following Gemzar (gemcitabine)-based therapy. With only one approved product in its portfolio, Merrimack is heavily dependent on Onivyde for growth.
Thus, successful development of other candidates in its pipeline is critical for Merrimack’s growth prospects.
However, competition is stiff in the breast cancer space. We remind investors that Roche (RHHBY - Free Report) dominates this market on the back of strong demand for its HER2 franchise, which includes drugs like Herceptin, Perjeta and Kadcyla.
Merrimack carries a Zacks Rank #3 (Hold).
Key Picks in the Sector
A couple of better-ranked stocks in the health care sector include Heska Corp. , and Vanda Pharmaceuticals (VNDA - Free Report) . Both of them sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Heska’s earnings estimates increased from $1.13 to $1.35 for 2016 and from $1.38 to $1.53 for 2017 over the last 60 days. The company posted a positive earnings surprise in all of the four trailing quarters with an average beat of 301.64%. Its share price has increased 93.6% year to date.
Vanda’s loss estimates for 2016 narrowed from 62 cents to 52 cents, while its earnings estimates for 2017 increased from 13 cents to 22 cents over the last 60 days. The company posted a positive earnings surprise in three of the four trailing quarters with an average beat of 56.65%. Its share price has surged almost 74.1% year to date.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>