While Cowen analyst Phil Nadeau believes the selloff on Wednesday in shares of Immunomedics (IMMU) is due to concerns related to the Food and Drug Administration’s Form 483 observations from a recent inspection of the company’s New Jersey facility, he remains confident the ASCENT trial will succeed and that sacituzumab will become standard of care in triple-negative breast cancer. Also commenting on the FDA's Form 483 observations, Piper Sandler analyst Joseph Catanzaro noted that whether the issues are addressable via a written response and/or post-marketing commitments before the June 2 PDUFA is critical.
COWEN STILL SEES APPROVAL: In a research note to investors, Cowen analyst Phil Nadeau attributed the selloff on Wednesday in shares of Immunomedics to concerns related to the FDA's Form 483 observations from a recent inspection of the company's New Jersey facility. While the deficiencies cited raise the risk of a delay, management continues to anticipate sacituzumab's approval on or before the FDA action date in the second quarter, Nadeau contended, adding that Immunomedics responded to the FDA within two weeks with a plan to rectify the issues. Nadeau remains confident the ASCENT trial will succeed and that sacituzumab to become standard of care in triple-negative breast cancer, and continues to think Immunomedics is worth $30 per share based on the potential of sacituzumab in breast cancer. He kept an Outperform rating on the name.
MANY ISSUES ALREADY ADDRESSED: Also commenting on the news, Piper Sandler analyst Joseph Catanzaro said that the issuance of the FDA's Form 483 observations to Immunomedics is not surprising, but whether the issues are addressable via a written response and/or post-marketing commitments before the June 2 PDUFA is critical. Catanzaro pointed out that the company has provided a detailed response to the issues cited in the 483, which are largely in relation to improvements across quality systems and procedures and that a number have already been addressed. Further, Immunomedics remains in a collaborative dialogue with the FDA to resolve the open items, he added. The analyst also noted that Immunomedics does not believe an additional inspection is required. Catanzaro has an Overweight rating and a $25 price target on the shares.
ON TARGET TO OBTAIN FDA APPROVAL: Immunomedics provided a business update on March 25 in lieu of the changes brought upon by the novel coronavirus pandemic. The company said at that time that it is closely tracking and adhering to federal and local guidelines on COVID-19, while maintaining business continuity across the value chain. Immunomedics noted that it has recently completed an FDA pre-approval inspection at its Morris Plains, New Jersey facility and that it continues to work collaboratively with the FDA on the ongoing BLA review with a PDUFA target date of June 2, 2020.
Immunomedics continues to accrue progression-free survival events for ASCENT, with a topline readout expected in the mid-2020 timeframe, reiterates its plan for a topline update on the full 100-patient cohort of TROPHY U-01 at a medical conference in the second half of 2020, and is proactively monitoring enrollment across all trials and is pausing the enrollment of new patients and the activation of new sites where necessary, the company added.
PRICE ACTION: In afternoon trading, shares of Immunomedics have dropped almost 20% to $10.85.
