ThBy MARNI USHEROFF Staff Reporter
Shares of Xencor Inc. leaped last week as news piled up its specific field.
The thinly traded stock of the Monrovia drug developer saw volume jump nearly seven times Wednesday as shares rocketed up 30 percent to close at $15.55, an all-time high. That made it the biggest gainer on the LABJ Stock Index. (See page 42.)
The following day, the company announced that it had struck a deal to collaborate with Danish pharmaceutical giant Novo Nordisk to license multiple Xencor technologies to discover new biologic drugs for an undisclosed target. Under the agreement, Xencor could receive as much as $175 million in upfront payments and future royalties. The stock went even higher that day, closing at $16.30.
“I really don’t know why there was a jump in the stock,” said Chief Executive Bassil Dahiyat, whose firm debuted on the Nasdaq last December. “I know we’ve been working hard to educate people on how our technology platform works and grow awareness of the company.”
The Novo Nordisk deal will use Xencor’s bispecific technology, which allows antibodies to bind to two targets; for example: a tumor cell and part of the immune system that could attack the tumor.
David Nierengarten, a Wedbush Securities Inc. analyst in San Francisco, said the stock price soared perhaps as a delayed reaction to preclinical data on its technology delivered by Xencor at a conference a couple of weeks ago. He added two other factors could have been at play as well.
Houston’s Bellicum Pharmaceuticals Inc. and Seattle’s Juno Therapeutics Inc., companies in the hot CAR-T field, like bispecific technologies an immunotherapy treatment, were scheduled to start trading last week. CAR-T therapies take cells from a patient’s blood, engineer it to recognize a specific protein in tumor cells, and infuse those cells back into the patient to attack cancers.
“What’s percolating through the investor world is: Can bispecific antibodies that engage T-cells do the same thing as CAR-Ts?” said Nierengarten, who added that Xencor has a relative valuation and market capitalization that’s lower than Bellicum, Juno and Santa Monica CAR-T developer Kite Pharmaceuticals Inc., possibly making it an attractive hedge.
