As part of the Biotech Showcase conference in San Francisco last week, a panel of noted experts in the industry gathered on the last day of the show (Jan. 10) to discuss the pulse of the biotech and gene therapy markets moving into 2018.
The panelists included analysts Mara Goldstein senior analyst director of research with Cantor Fitzgerald and Steve Brozak president of managing partner and president of WBB Securities. Talking about the industry as a whole, Brozak explained his concept of the market working like a pendulum and how its swings can affect the entire market.
The panel touched on a variety of topics from the updates to the U.S. drug regulator, construction of clinical trials and what to look for especially in the immuno-oncology space (I/O).
Immediate impact in 2018 from new data
Goldstein told her fellow panelists that–in her eyes–the market is set to see some interesting developments with the releases of new data that could further increase the potential of biotech and the I/O.
“We’re going to get some of those first really registration type readouts in combination trials with I/O and that really has big impatience for a lot of companies working in this space of alternative checkpoint inhibitors, costimulatory molecules… I think that’s going to be a very big theme this year for oncology in general,” Goldstein said.
Another big element for biotech in 2018 will be the activity of the active companies in this space. Thanks to the tax reform coming from Washington, companies appear ready to begin the search for merger and acquisitions (M&A) needed to expand their business. This trend seems to be ready to hit companies of all sizes.
“For the last few years I think we have all said, ‘M&A it’s coming, and it’s coming.’ The question is, does that really drive broader investment in the [United] States? Does that really bring the generalists into the biotech space? Which is where you really begin to see more sustainable performance for some period of time,” she said.
More efficient clinical trials are on the horizon
Another panelist, Dr. George Zavoico, a senior research analyst in healthcare with B. Riley FBR, added a trend he will be watching closely is the more efficient construction of clinical trials in both the I/O and gene therapy space.
“You’re going to see much more careful designs of clinical trials and protocols to focus on particular patient populations, smaller patient populations,” Zavoico said.
He added in terms of gene therapy, a market that more and more is fusing in research with the biotech space, the key questions for him will be about the durability of the actual therapies in patients and their costs.
“Will it last and [enough] to justify the cost that are going to be demanded by companies that develop gene therapy?” Zavoico questioned.
Trendy areas for investors in the I/O sector
Moderator, Mark Simon, managing director of Torreya proceeded to ask the panel about the relevance of I/O, it’s hottest areas right now and what investors need to know since some companies are riding high and others are “down in the dumps.”
“We are finally at a point where the biological understanding is catching up with the clinical trial science and that really is a huge opportunity,” Goldstein said. “I think that we will see from a registration perspective is really more 2019 I think than 2018.”
In terms of the U.S. Food and Drug Administration (FDA), the panel discussed some of the recent changes the agency has undergone and looked at the need for more predictable actions and guidelines when it comes to gene therapies.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.