Immunomedics (IMMU) Soars After an Update Regarding its ADC Programs
Shares of biotech Immunomedics (IMMU) soared 16% at the end of last week, defying the slumping market, after the company provided a long-awaited clinical update regarding its antibody-drug conjugate (ADC) programs. ADCs are considered a crucial piece of cancer research, since they attach a chemotherapy toxin to a single antibody, which is taught to recognize proteins associated with a targeted cancer.
When the trained antibody comes in contact with the targeted protein, it releases the chemotherapy toxin in an effort to kill the cancer cell, while sparing healthy cells. Daily Chart
If ADCs are successful, they can actually spare cancer patients the painful process of chemotherapy. Traditional chemotherapy not only targets cancer cells, but also any cells that divide rapidly - including cells in the bone marrow, digestive tract and hair follicles. This leads to the worst side effects of chemotherapy - the decreased production of blood cells, a weakened immune system, the inflammation of the digestive tract, and hair loss. In its recent update, Immunomedics announced the two of its three tested ADCs, IMMU-130 and IMMU-132, caused tumors to shrink, and had positive effects in metastatic colorectal cancer and triple-negative breast cancer. IMMU-130 is designed specifically for colorectal cancer, and IMMU-132 has been tested on 13 different types of cancer. Immunomedics uses a proprietary system, which it calls "Dock and Lock," which distinguishes it from competitors. Immunomedics is not the only biotech company researching ADCs, which are widely regarded as the future for cancer treatment. ImmunoGen IMGN has been developing a proprietary technology similar to Immunomedics' ADCs. ImmunoGen already offers a FDA-approved drug for HER2-positive breast cancer, known as Kadcyla, which is used in combination with Roche's Herceptin. Seattle Genetics also has an ADC pipeline, which is pursuing the same goals. In addition to advances in ADCs, Immunomedics also specializes in radiotracer technology. Radiotracers are comprised of a small peptide which a fluorescent dye and a linker known as DOTA, which is used for radiolabeling. Radiotracers are useful tools for the accurate location of tumors during surgery. Although Immunomedics' technology is cutting edge and could unlock the cure to various kinds of cancer, its stock is highly volatile. Since its public debut in 1984, the stock has only risen 33%, while the NASDAQ has risen 1,200% over that same period. Shares of Immunomedics peaked at $37 per share prior to the dot-com crash, but shares have fallen to $5 over the past decade. Yet even at this low price, it is still trading at a premium, at 8.12 times its book value, and a negative profit margin of -263.55%. It is currently unprofitable, but it managed to grow its revenue by nearly 80% last quarter. In other words, this is a highly speculative stock that has very little fundamental scaffolding underneath, and will surge and plunge on news of the progress of its clinical trials. Other News About IMMU Immunomedics Develops Novel Dual System for Tumor Detection and Imaging
Immunomedics produces new detection and imaging technologies. Immunomedics Reports Progress With Labeling Proteins
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Published on Jun 28, 2013
By Leo Sun