Puma Biotechnology Inc. (NASDAQ: PBYI) saw its shares take a dive on Wednesday following regulatory events in Europe. Specifically, the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) completed a negative trend vote for Puma’s HER2-positive breast cancer therapy neratinib. While this is not set in stone that the drug will not win European approval in February, the chances are unlikely.
A negative trend vote means it is unlikely that CHMP will provide a positive opinion related to the company’s Marketing Authorization Application (MAA) at the formal CHMP decision vote scheduled in February 2018, and that additional steps would need to be taken to gain marketing approval in Europe.
The CHMP indicated that, in its opinion, the benefit risk assessment is negative as the study results are based on evidence from a single pivotal trial and the two-year and five-year invasive disease-free survival benefits observed to-date may lack sufficient clinical relevance.
Overall, the CHMP’s opinion was based on the results from both the Phase 3 ExteNET trial in extended adjuvant early-stage HER2-positive breast cancer and the Phase 2 CONTROL trial in extended adjuvant early-stage HER2-positive breast cancer.
A few analysts slashed their price targets in response:
- Citigroup has a Buy rating but lowered its price target to $146 from $164.
- Credit Suisse has an Outperform rating but lowered its target to $106 from $147.
- RBC has a Sector Perform rating with a $77 price target.
- JPMorgan has a Positive rating and lowered its price target from $138 to $91.
- Cowen downgraded it to a Market Perform from Outperform and lowered its target to $68 from $123.
Excluding Wednesday’s move, Puma had underperformed the broad markets, with its stock down 8% year to date. However, over the past 52 weeks, the stock is up about 192%.
Shares of Puma traded down about 28% to $65.20 on Wednesday, with a consensus analyst price target of $130.44 and a 52-week range of $28.35 to $136.90.