Magnetfeldfredy : Sangamo
Feb. 25, 2011, 2:56 p.m. EST
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|Recommend PrintEmail AlertBy Val Brickates Kennedy, MarketWatch
BOSTON (MarketWatch) ? Shares of Sangamo BioSciences Inc. could see significant action early next week, when the company is scheduled to present data on its promising HIV therapy at a high-profile AIDS research conference in Boston.
Sangamo?s /quotes/comstock/15*!sgmo/quotes/nls/sgmo (SGMO 8.46, -0.04, -0.47%) shares added 10% in afternoon trading Friday.
The Richmond, Calif.-based biotech firm plans to present early-stage data on its cellular therapy SB-728, which uses the company?s proprietary gene-modifying technology. Sangamo believes the therapy can render immune-system cells resistant to HIV, thereby restoring the body?s ability to ward off infection.
Sangamo's 'functional cure' for HIVSangamo Chief Executive Edward Lanphier speaks with Val Brickates Kennedy about the company's "functional cure" for HIV and why his company's stock has jumped 100% in recent months.
?I think the characterization that I?d give is ?functional cure,? meaning the ability to create a compartment of the immune system that is protected, cannot be infected by the virus but is actually capable of mounting an antiviral immune response as well as responding to any of the opportunistic infections that cause the AIDS component of HIV,? Sangamo Chief Executive Officer Edward Lanphier told MarketWatch in a recent interview.
If successful, SB-728 could greatly reduce a patient?s dependence on complicated and costly HIV drug regimens, Lanphier added.
The upcoming medical meeting, called the Conference on Retroviruses and Opportunistic Infections, or CROI, will begin Sunday and run through Wednesday, March 2. Next week, researchers will present initial Phase I data on SB-728, with more data to be released in the fourth quarter. The data should indicate not only whether the product is safe but also which types of patients are best suited for the therapy.
According to Wedbush analyst Liana Moussatos, the industry expects the CROI data to be positive, adding that the conference sponsors are very picky about which presentations they choose to include.
?It won?t be negative data. I?m not worried about a downside from CROI,? she said.
But even if SB-728 proves to be a success in the clinic, analysts said it still must show some benefit over existing HIV therapies to be a market success.
Key factors will be how well and for how long it can lower the level of HIV in the bloodstream, whether it has fewer side effects than competing therapies and whether it can reduce the need for additional medications.
Moussatos added that because SB-728 is a cellular therapy that needs to be administered in a clinical setting, how often a patient will need to be dosed is also a major factor. She estimated that in order to compete with other AIDS drugs, the therapy needs to be administered less than once a month.
Typically, dosing requirements are determined during Phase II clinical testing.
Excitement over the company?s HIV program has also helped fuel trading in Sangamo shares, which have shot up 100% over the past three months. But other factors are also fanning the fire.
More promise in the pipeline
The biotech firm?s drug candidate to treat diabetic neuropathy, which is painful nerve damage caused by diabetes, has been pegged as the company?s most lucrative opportunity. Currently, the condition is treated with painkillers and antidepressants.
Sangamo?s therapy, called SB-509, offers a different approach. Sangamo said the product, dubbed a neuroregenerative therapy, is actually able to trigger regeneration of damaged nerve cells. The product is now in its last Phase II testing for the condition.
As few effective treatments exist for diabetic neuropathy, some analysts have estimated the market size for the product to be as large as $6 billion. The American Diabetes Association sets the number of Americans living with diabetes at almost 26 million, or roughly 8% of the population.
Sangamo is also testing SB-509 for treatment of the devastating neurodegenerative disease ALS, or Lou Gehrig?s disease.
If Sangamo is able to produce positive data from its HIV and diabetic-neuropathy programs over the next few months, the stock could shoot up more than 50% by the end of the year, said Moussatos.
Such success would also make Sangamo an increasingly attractive target for a larger pharmaceutical company, a scenario that has further stoked interest in the shares.
?Sure, they?re a target,? said Moussatos. ?Once they can prove their platform for AIDS, ALS or diabetic neuropathy? they?ll become even more of a takeover target.?
She noted that potential suitors could include several leading makers of HIV therapies, such as Sanofi-Aventis SA /quotes/comstock/13*!sny/quotes/nls/sny (SNY 34.20, +0.05, +0.15%) , Roche Holding AG /quotes/comstock/11i!rhhby (RHHBY 37.05, +0.06, +0.16%) , Bristol-Myers Squibb Co. /quotes/comstock/13*!bmy/quotes/nls/bmy (BMY 25.54, +0.05, +0.20%) or GlaxoSmithKline PLC /quotes/comstock/13*!gsk/quotes/nls/gsk (GSK 38.12, -0.16, -0.41%) . Other possibilities are large-scale makers of biologic therapies, such as Abbott Laboratories /quotes/comstock/13*!abt/quotes/nls/abt (ABT 47.47, -0.19, -0.39%) or Johnson & Johnson /quotes/comstock/13*!jnj/quotes/nls/jnj (JNJ 59.58, -0.06, -0.10%) .
?I still think the stock is undervalued,? she added.
Val Brickates Kennedy is a reporter for MarketWatch in Boston