+ Watch AVEO
on My Watchlist
Short term play, based on chart action and news that this company is not dead yet: Near 52-week (or is it longer?) low, after approx 33% drop basd on bad news. The plan: Expect lots of price chop, so wait until the volatility takes it high and get out before news on tests breaks next month.
Tivo will be approved before July 28.
AVEO has turned into a real swamp these days, due partly to the design of the completed TIVO-1 phase III trial of tivozanib for renal cell carcinoma and partly to the mixed results of the trial. The share price ran from 8 to over 20 in anticipation of the trial results, then declined moderately in January after the progression free survival data showed a modest benefit of 11.9 months for tivozanib vs 9.1 months for Nexavar. The problem was that in the interim a competing drug called Sutent had shown an 11 month progression free survival. Therefore, tivozanib may have been set against the wrong competitor.Later in the year, the selloff accelerated after the company projected one year overall survival of 77% for tivozanib vs 81% for Nexavar. The median OS still has not been reached. Further complicating the picture was that many patients from the Nexavar group were transitioned to tivozanib at the conclusion of the treatment phase of the trial, with an unpredictable effect on OS.AVEO bulls like Ohad Hammer point to the crossover design and the better side effect profile of tivozanib as reasons why the drug will be approved by the FDA next year and will achieve a reasonable market share in renal cell carcinoma. This is a classic scenario of dueling viewpoints and chaos that will lead to substantial volatility in AVEO stock until the tivozanib PDUFA, and likely afterwards. The chart looks ugly now but at some point a bottom will make itself known and the share price will rise again going into the PDUFA.
short term hold, but several of the people I follow have picked this recently, so I like the odds it is on an uptrend.
There are currently 1100 AVEO shares in my fund with break-even of around 15.55 USD.http://caps.fool.com/Blogs/fund-trades/705717.http://twitter.com/portefeuillefun.
AVEO's tivozanib works by inhibiting all three VEGF receptors (it is a pan-VEGF inhibitor). Genentech/Roche's Avastin is another drug that hits VEGF and it is one of the top selling Biologics on the market. Eventually it sounds like AVEO has plans to take on Avastin as a safer alternative, but that is probably a ways down the road. In the nearer term, the TIVO-1 PIII trial for Renal Cell Carcinoma (RCC) is going head to head against sorafenib (Nexavar®) with results expected in mid-2011. PII tivozanib data released by AVEO look good and Astellas liked the data enough to sign a nice partnership deal. The only thing that worries me a bit is that all the clinical sites for the PII trial were in Russia and India only. For me though, the bottom line with AVEO is the science is compelling and if AVEO succeeds with TIVO-1 it could have a blockbuster on its hands...I like the risk reward.
Poor Forward Earnings Estimate
I have RCC. Stinks but I am all for any biotech company that takes the time to perhaps find a cure. Phase 3 trials are looking good. So yea they are going to get any financing needed. Look forward to mid 2011!
Well above it's IPO price while every other drugmaker that's IPOed this year is below their initial price. This one is headed there too.
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