Celldex's Immuno-Oncology Pipeline Continues To Impress

On May 25, we issued an updated research report on Hampton, NJ-based Celldex Therapeutics, Inc. (NASDAQ:CLDX) . Celldex is a development-stage biopharmaceutical company focused on the development and commercialization of immunotherapy technologies and other cancer-targeting biologics.

So far this year, Celldex’s share price has been trading below the Zacks categorized Medical-Biomed/Genetics industry. The stock has lost 12.1% compared with an increase of 0.6% for the broader industry.

Clovis reported results for first-quarter 2017 earlier this month. The company’s loss of 28 cents per share came in line with the Zacks Consensus Estimate but was narrower on a year-over-year basis. Revenues rose 15.3% year over year to $1.5 million in the quarter, beating the Zacks Consensus Estimate of $0.57 million. Celldex currently does not have any marketed product in its portfolio and the quarterly revenues were generated mainly under the clinical trial collaboration with Bristol-Myers Squibb Company (NYSE:BMY) and the research and development agreement with Rockefeller University.

Celldex’s efforts to build its immuno-oncology pipeline are impressive. Its lead pipeline candidate, glembatumumab vedotin is currently being evaluated for the treatment of triple negative breast cancer (phase IIb - METRIC study) and metastatic melanoma (phase II). Enrollmentin the METRIC study is expected to be completed in September this year, with data expected in the second quarter of 2018. In the melanoma study, Celldex added two new cohorts, a glembatumumab plus varlilumab arm and a glembatumumab plus checkpoint inhibitor arm, including either Bristol-Myers’ Opdivo or Merck & Co, Inc.’s (NYSE:MRK) Keytruda. In the melanoma study, glembatumumab performed well in the single agent setting.

Meanwhile, Celldex has collaborated with PrECOG and National Cancer Institute (NCI) to develop glembatumumab vedotin for the treatment of uveal melanoma and osteosarcoma, respectively.

Apart from glembatumumab vedotin, Celldex is developing an immune modulating antibody, varlilumab, designed to enhance a patient’s immune response against their cancer. Varlilumab is being evaluated in combination with Opdivo in a phase II study that includes cohorts in five indications, colorectal cancer, ovarian cancer, head and neck squamous cell carcinoma, renal cell carcinoma and glioblastoma.

Other promising pipeline candidates include CDX-1401/CDX-301 (phase II - multiple solid tumors; in collaboration with CITN) and CDX-014 (phase I - advanced renal cell carcinoma) among others.

Importantly, with the Kolltan acquisition in Nov 2016, Celldex gained rights to two of Kolltan’s cancer pipeline candidates, CDX-0158 (phase I; refractory gastrointestinal stromal tumors/GIST and other KIT positive tumors) and CDX-3379 (to enter phase II in 2017 in solid tumors). Celldex also acquired Kolltan’s multi-faceted TAM program.

While the company is building a strong pipeline, it has suffered its share of setbacks. In Mar 2016, Celldex discontinued the phase III ACT IV study on Rintega for the treatment of patients with newly diagnosed EGFRvIII-positive GBM. The discontinuation of a late-stage study of this previously lead candidate of the company came as a major blow. The company has also decided not to advance the phase I combination studies of varlilumab with Roche’s Tecentriq and varlilumab with Pfizer Inc.’s (NYSE:PFE) Sutent in renal cell carcinoma to phase II development.

Nonetheless, analysts are positive about the company’s performance in the second quarter of 2017 as loss estimates narrowed 13.33% over the past 30 days. Three estimates moved up while none moved in the opposite direction in the same period.

Clovis has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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