Biotech Winners, Losers In Q1

Biotech stocks have had a fairly good outing so far in 2019 after generating negative returns in 2018. The iShares NASDAQ Biotechnology Index IBB clocked a gain of 15.94 percent for the March quarter, outperforming the broader market gain of 13.07 percent.

Biotech stocks are known for their volatility given their strong reaction to make-or-break catalytic events, which are mostly binary in nature, and the limited float available, which makes them susceptible to manipulation.

Regulatory decisions on drug approvals began to pick up pace only after the partial government shutdown ended in late January. The first quarter saw a slew of deal announcements, with most of them being in the gene therapy space.

The following are biotech stocks that recorded staggering gains and those that witnessed sharp declines in the first quarter.

The Gainers

Axsome Therapeutics Inc AXSM

• Year-to-date change: +404.61 percent.
• Profile: Develops therapies for central nervous system disorders.
• Catalysts: positive results were reported for a Phase 2 study of the major depressive disorder, or MDD, candidate AXS-05 Jan. 7.

Axsome's shares picked up further momentum after the FDA approved SAGE Therapeutics Inc SAGE's postpartum depression drug. Most recently, the news of FDA granting Breakthrough Designation therapy to AXS-05 added to the buoyancy.

Upcoming Catalysts

Topline results of a Phase 2 study of AXS-05 in treatment-resistant depression due in the second quarter of 2019.

Topline results of a Phase 2 study of AXS-05 in smoking cessation due in the second quarter of 2019.

Axsome to meet with the FDA on its AXS-05 for MDD in the second quarter of 2019 to discuss the potential regulatory path.

Topline results of a Phase 2 study of AXS-12 in narcolepsy due in the second quarter of 2019.

Topline results of a Phase 3 study of AXS-07 in the acute treatment of migraine due in the first quarter of 2020.

Topline results of a Phase 2/3 study of AXS-05 in Alzheimer's disease-related agitation in the first half of 2020.

Wall Street's Take

Based on recommendations by three analysts covering the stock, Axsome has a Strong Buy rating and an average price target of $21, according to Tipranks. The price target suggests roughly 47.58-percent upside from current levels based on the March 29 closing price.

Immune Design Corp IMDZ

• Year-to-date change: +350 percent.
• Profile: A late-stage immunotherapy company which uses technologies to activate the immune system's natural ability to generate and/or expand antigen-specific cytotoxic immune cells to fight cancer and other chronic diseases.
• Catalysts: A Feb. 21 announcement of an agreement to be acquired by Merck & Co., Inc. MRK for $300 million.

The deal announcement sent the shares of Immune Design soaring by about 310 percent. The shares have been hovering around the per share deal value of $5.85 since then.

The company's lead candidate G100, an intratumoral TLR4 agonist, is being studied as a monotherapy as well as in combination with local-low dose radiation and Merck's Keytruda in a Phase 2 trial for follicular lymphoma.

Upcoming Catalyst

The expected closing of the Merck deal in the second quarter of 2019. 

Wall Street's Take

Among three analysts who have rated Immune Design, according to Tipranks, one has a Buy rating and the remaining two have Hold ratings. The average price target is $5.93.

See also: Analysts Digest Biogen's Alzheimer's Disappointment: 'There Isn't Much To Be Excited About'

PLx Pharma Inc PLXP

• Year-to-date change: +243.14 percent.
• Profile: a late-stage specialty pharma company.

From $1.53 on Dec. 31, 2018, the shares doubled to $3.04 by Jan. 8 and rose above $4 by Jan.10. After hitting an intraday high of $6.24 March 14, the stock has given back some gains but is still notably higher.

The company is developing the PLxGuard delivery system for the delivery of active pharmaceutical ingredients to various portions of the gastrointestinal tract, as well as Vazalore 325mg and Vazalore 81mg — novel aspirin for high-risk cardiovascular patients. Vazalore 325mg has already been approved by the FDA, and PLx is now focusing on manufacturing, scale-up and label finalization.

Upcoming Catalysts

A Type C meeting scheduled with the FDA in the second quarter of 2019 on Vazalore 325mg.

A sNDA submission for Vazalore 81mg by the end of 2019.

A Vazalore launch (both doses) in mid-2020.

Wall Street's Take

Out of the two analysts rating shares of PLx, one has a Buy rating and another a Hold rating, according to Tipranks.

The Losers

Aptinyx Inc APTX

• Year-to-date change: -75.51 percent.
• Profile: Develops therapies for brain and central nervous system disorders.
• Catalysts: reported negative results for a Phase 2 study of NYX-2925, its treatment candidate for painful diabetic peripheral neuropathy, or DPN, sending shares down by 66.5 percent.

NYX-2925 is Aptinyx' lead product candidate which is being studied in mid-stage trials for both painful DPN as well as fibromyalgia. It has another mid-stage asset, namely NYX-783, being evaluated for post-traumatic stress disorder, or PTSD, and an early stage asset, NYX-458, for Parkinson's disease cognitive impairment.

Upcoming Catalysts

Presentation of pre-clinical data for NYX-458 at the 14th International Conference on Alzheimer's & Parkinson's Diseases in Lisbon, Portugal March 29-30.

Presentation of detailed Phase 2 results for NYX-2925 as a poster at the American Pain Society Scientific Meeting in Milwaukee, Wisconsin April 4.

Phase 2 data readout for NYX-2925 in fibromyalgia in the first half of 2019.

Phase 1 readout for NYX-458 in healthy volunteers in the first half of 2019.

Topline data from the Phase 2a first-inpatient study of NYX-783 in PTSD in the first half of 2020.

Wall Street's Take

Based on ratings from five analysts, Aptinyx is rated a Buy by four and a Hold by one. The average price target is $14.25, suggesting about 250-percent upside from current levels.

ContraFect Corp CFRX

• Year-to-date Change: -74.01 percent. 
• Profile: Develops therapies for drug resistant, life-threatening infections.
• Catalyst: reported Jan. 7 disappointing Phase 2 data on exebacase, its lead asset which is being evaluated for the treatment of staphylococcus aureus bacteremia, including endocarditis, and the stock reacted with a 55-percent move to the downside.

Upcoming Catalyst

Full data readout from the Phase 2 study of exebacase due in the first half of 2019.

MOTIF BIO PLC/S ADR MTFB

• Year-to-date change: -72.23 percent.
• Profile: Develops antibiotics for life-threatening infections caused by multidrug-resistant gram-positive bacteria, including MRSA.
• Catalysts: Motif Bio shares lost about three-fourths of their market cap Feb. 14 after the company announced the receipt of a complete response letter from the FDA regarding its NDA for iclaprim for the treatment of acute bacterial skin and skin structure infections, or ABSSSI.

Motif Bio is focusing on iclaprim, which is being tested for indications such as ABSSSI (late-stage development) and hospital-acquired pneumonia/ventilator-acquired pneumonia (mid-stage development).

Upcoming Catalyst

The FDA has a Type A meeting scheduled with Motif May 3 to discuss the points raised in the CRL for iclaprim.

Wall Street's Take

Out of the three analysts polled by Tipranks, one has a Buy rating and two have Hold ratings, and the average price target is $3.50, suggesting roughly 90-percent upside from current levels.