Tags: Tekmira | stock | Ebola | drug

Tekmira Surges Amid Promise of Experimental Ebola Treatment

Tuesday, 04 November 2014 01:30 PM

Tekmira Pharmaceutical Corp. is leading Ebola-related drug stocks as investors wager the Canadian company’s therapy is among the most promising to combat the strain of the outbreak that’s sweeping West Africa.

Shares of the Burnaby, British Columbia-based company, which is developing its treatment under a $140 million contract with the U.S. Defense Department, have advanced 113 percent this year, the most among competitors including Sarepta Therapeutics Inc. and BioCryst Pharmaceuticals Inc.

Tekmira is able to quickly engineer therapies “that can interrupt the life cycle of Ebola virus, particularly the one that’s in West Africa,” said Jason Kolbert, an analyst with Maxim Group LLC in New York. “That’s pretty significant.”

Companies from Tekmira to GlaxoSmithKline Plc are racing to develop drugs and vaccines to address an outbreak with 13,500 recorded infections and 4,951 deaths, concentrated in Liberia, Sierra Leone and Guinea while affecting people in Dallas and New York. The latest epidemic has killed more people than all previous outbreaks combined and may affect thousands a week by December, according to the World Health Organization.

Tekmira has started making a new therapy that specifically targets the Guinea variant and is able to “rapidly and accurately match the evolving genetic sequences” of the disease, the company said in an Oct. 21 statement. Supplies are set to be available in early December.

Human Trials

The U.S. Food and Drug Administration approved Tekmira’s TKM-Ebola for use in patients with confirmed or suspected Ebola virus infections under expanded-access protocols in September. To date, “several patients have been treated with this product,” and Tekmira will continue to provide the therapy to patients if requested, the company said in the statement. Human trials of the drug in West Africa have “not yet been confirmed,” the company said.

Tekmira rose 2.1 percent to C$18.33 at 12:55 p.m. in Toronto for a market value of C$408 million ($358 million). Five analysts, including Kolbert, recommend buying the stock, while one says hold, according to data compiled by Bloomberg. The shares have a C$35.93 target price, according to the average of five of those analysts.

The company, which specializes in treatments that use the body’s natural processes to silence disease-causing proteins, has been attracting investment because of its broader pipeline of therapies, Chief Executive Officer Mark Murray said at a biotechnology forum in San Francisco on Oct. 7.

Other Treatments

Those include cancer medicine and a treatment that eliminates production of a certain protein in chronic hepatitis B patients, Murray said.

Murray told the forum he realized the Ebola outbreak may have an impact on Tekmira when colleagues trying to study the virus in West Africa called to ask if “they could take some of our drug product with them in the event that they became exposed.”

The therapy has shown the ability to treat animals infected with Ebola as long as 72 hours after they were injected with the virus, Murray said in a February conference call.

Tekmira declined an interview request with Bloomberg News, as did Cambridge, Massachusetts-based Sarepta. BioCryst, based in Durham, North Carolina, didn’t respond to an request for comment.

Volatile Path

Tekmira stock has had big swings, reaching a record of C$34.16 in March after the company won fast-track designation from the U.S. FDA to develop an experimental treatment against Ebola. The shares, which have dropped 46 percent in the past month, usually ebb along with lulls in the company’s Ebola news, said David Novak, an analyst with Clarus Securities in Toronto.

The effectiveness of the company’s Ebola treatment will need to be proven in a controlled clinical study in Africa from which it will take “at least four to six months to get any data,” Michael Yee, an analyst with RBC Capital Markets in San Francisco, said in an Oct. 17 report.

The company’s hepatitis B drug “remains the key long-term driver” for the company, Yee said in the report.

“This is why we recommend caution on premature excitement” on Tekmira’s Ebola program, Yee said in a Sept. 22 report.

Hamster Ovary

Tekmira is up against a wide field in the race to beat a disease which has a fatality rate as high as 90 percent and is so deadly some governments consider it a national-security threat. First identified in 1976 near the Ebola River in what is now the Democratic Republic of Congo, researchers believe the disease is hosted by fruit bats, according to the U.S. Centers for Disease Control and Prevention.

Closely held Mapp Biopharmaceutical Inc. is rushing to try and make more ZMapp, a cocktail of three antibodies that can be grown in tobacco plants. Amgen Inc. said last month it would work with the San Diego-based company to see if the drug can be made in Chinese hamster ovary cells.

Fujifilm Holdings Corp.’s influenza drug Avigan has been used to treat Ebola. Sarepta, meanwhile, said last month it has enough drugs to treat as many as 24 Ebola patients and could boost that to 100 patients depending on funding.

Vaccine Trials

Human trials of vaccines from GlaxoSmithKline and NewLink Genetics Corp. will begin in Liberia and Sierra Leone in December, according to the WHO. Mass vaccinations could begin in the second half of next year if the drugs are proven to be safe and effective, the group said.

The Canadian government has also been working on an experimental Ebola vaccine, shipping 800 vials of it to the WHO in Geneva on Oct. 20. Results from clinical trials are expected in December, the government said in a statement.

The vaccine, developed by scientists at the National Microbiology Laboratory in Winnipeg, hasn’t been tested in humans, and results from clinical trials at a U.S. research facility are expected in December. Canada has licensed the rights to Ames, Iowa-based NewLink.

NewLink Genetics was the only company that “provided a viable offer of commercialism given the limited market” at the time, Eric Morrissette, a spokesman for Health Canada, said in an e-mailed statement. The patents for the vaccine were filed in July 2002, and the first research paper was published in June 2005, according to the government.

Even with potential competition on the horizon, the potential for Tekmira to secure contracts from government stockpiling has grown as Ebola cases have emerged in multiple countries, Clarus Securities’ Novak said.

Government Stockpiling

“We think it’s likely additional jurisdictions will acquire supply contracts,” Novak said, pointing to countries such as China and the European Union and health organizations such as Medicins Sans Frontieres.

With data showing the prevalence of Ebola can grow from zero to nearly 7,500 cases in months and not years, the U.S. government may seek to have hundreds of thousands of TKM-Ebola doses on hand, Doug Loe, an analyst with Euro Pacific Canada Inc., said in an Oct. 15 report. Previously, it was thought the government would only require tens of thousands of doses, according to the report.

“It’s certainly a higher-risk play, but relative to other drug developments, we think it’s substantially de-risked,” Novak at Clarus said.

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Tekmira Pharmaceutical Corp. is leading Ebola-related drug stocks as investors wager the Canadian company's therapy is among the most promising to combat the strain of the outbreak that's sweeping West Africa.
Tekmira, stock, Ebola, drug
Tuesday, 04 November 2014 01:30 PM
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