VOL. 127 | NO. 21 | Wednesday, February 01, 2012
GTx Shares Rise 50 Pct. After Positive Citigroup Report
By Aisling Maki
Shares of GTx Inc. rose about 50 percent Monday, Jan. 30, after Citigroup predicted the Memphis-based pharmaceutical company was likely about a year away from reporting positive results from its Phase III clinical trials for Ostarine, a drug designed to prevent and treat muscle wasting in cancer patients.
Citigroup estimated that positive outcomes of the trial could be worth at least $11 per share and that Ostarine could attract the interest of biopharma companies that offer oncology products. Citigroup also raised its price target from $8 to $19 after adding Ostarine to its valuation.
GTx shares opened Monday at $4.81 and closed at $5.88, with an intraday high of $6.24. Its closing price Friday, Jan. 27, was $3.94.
The price held steady Tuesday, closing at $5.85.
Muscle wasting is a common cancer-related problem resulting in decline in physical function, and those limitations predict the ability of non-small cell lung cancer patients to tolerate chemotherapy.
Patients with functional limitations are less likely to be administered treatment; functional status is also a predictor of survival.
About half of patients with advanced non-small cell lung cancer suffer severe muscle loss. Muscle weakness and functional limitations are highly prevalent, with 88 percent of patients reporting difficulty climbing stairs, lifting and carrying small loads, walking short distances, and stooping, crouching or kneeling.
Also a side effect of many chemotherapy drugs, muscle wasting currently has no approved treatment.
The Ostarine clinical program, which to date has included 600 patients in eight trials, has shown consistent results in different patient populations, with 69 percent of patients showing improved physical function and 63 percent showing improved lean body mass endpoint, compared to 33 percent for placebo group on both endpoints.
GTx has traded with a 52-week range of $2.27 to $6.86.
Citigroup said it believes GTx is “currently one of the most compelling small-cap biotech companies,” citing the strength of two drugs in its current pipeline – Ostarine and Capasaris. The latter is a hormone treatment for men with advanced prostate cancer.
GTx is slated to release its 2011 Q4 and full-year earnings report Feb. 23. The company trades on NASDAQ as GTXI.