Biotechs can be risky. 90% of drugs that enter clinical trials don’t make it out of those trials, let alone to pharmacy shelves.
But when a revolutionary new treatment delivers solid clinical results or makes it to market, it can send a biotech skyrocketing higher.
The two biotechs discussed below may not be familiar names, but both could soon deliver blockbuster treatments that will have a major impact on their stock prices.
Here’s what you need to know about these two little-known biotechs.
Assembly Biosciences (NASDAQ: ASMB)
Assembly Biosciences (NASDAQ: ASMB) is a clinical stage biotech that is working on a new way to treat hepatitis B virus (HBV) with its ABI-H0731 candidate.
The company reported phase 1 data in November, but it was largely overlooked by the market. But on April 13, the company could start to get some of the attention it has been missing when it presents at the annual meeting of the European Association for the Study of the Liver (EASL).
Assembly is scheduled to present six-month data from ongoing phase 2 studies for ABI-H0731 and new HBV patients, as well as another trial with chronic HBV patients, at EASL’s International Liver Congress (ILC). EASL accepted the company’s presentation of six-month results as a late-breaker for the main event and called it a “best of ILC” submission.
“We are proud to have several abstracts accepted at EASL 2019 for each of our three core inhibitors and one highlighting our continuing research efforts on the turnover rate of cccDNA,” said Derek Small, President and CEO of Assembly Biosciences. “We are excited to potentially be the first in the HBV field to show clinical data from studies combining a core inhibitor and nucleos(t)ide therapy. This data may serve to inform proof of concept which we believe is two-fold: Demonstrating rapid and greater levels of viral suppression for patients, while on the path to increasing cure rates in HBV over a finite period of time.”
There are roughly 1.5 million patients living with chronic HBV in the U.S., and the disease requires lifelong treatment to stop the virus from shutting down patients’ livers – though these treatments often fail. A more effective treatment for the disease could quickly drive annual sales to the tune of several billions within just a few years, so if Assembly can deliver a successful treatment, we could see the stock surge much higher.
Analysts’ average price target for ASMB is $52.75, suggesting possible upside of 168.58% over the next twelve months.
Regenxbio (NASDAQ: RGNX)
Regenxbio (NASDAQ: RGNX) may not be a familiar name, but the company’s patent portfolio might just be on the cusp of producing significant revenue as gene therapies using its technology come to market.
This biotech makes viral vectors used by drug developers to deliver gene therapies to their target. They’ve developed a proprietary portfolio of adeno-associated viral (AAV) vectors that drug developers can use to to develop new therapies addressing the over 6,000 diseases caused by genetic mutations.
The first gene therapy to use Regenxbio’s AAVs is up for FDA approval in May. The therapy, Zolgensma, isn’t guaranteed to get the green light from the FDA, but Novartis (NYSE: NVS) was confident enough in Zolgensma’s prospects to buy its creator, AveXis, for $8.7 billion in 2018.
If the therapy is approved, Regenxbio will collect single-digit to low double-digit royalties, as well as up to $80 million in sales milestones.
But Regenxbio isn’t just reliant on Zolgensma. There are 14 other companies currently developing therapies using the company’s technology, including Ultragenyx (NASDAQ: RARE) and Sarepta Therapeutics (NASDAQ: SRPT), and Regenxbio is also developing its own gene therapies.
The company presented promising early-stage results for its RGX-314 wet age-related macular degeneration—a potentially revolutionary one-and-done treatment for a multi-billion indication—and plans to do a larger phase 2b trial later in 2019. Regenxbio also plans to announce interim data on its phase 1/2 clinical trial evaluating its RGX-121 therapy for mucopolysaccharidosis (MPS) type II in the second half of the year.
Viral vectors are critical in enabling gene therapies to work, and Regenxbio’s proprietary portfolio of AAVs makes it possible for developers to produce new therapies for the thousands of diseases caused by genetic mutation. Gene therapy is a game-changer, and investors eager to invest in this technology should pay close attention to Regenxbio.
The average price target for RGNX is $81.68, indicating possible upside of 42% over the next twelve months. Chardan Capital recently reiterated its Buy rating on the stock and set their price target at $127.50 – 121% higher than the current price.