Nektar Stock Plunges on Worries Over Trial Results of Cancer Drug

Nektar Therapeutics saw a third of its stock value disappear on Monday during trading after the response rates in kidney and melanoma cancer patients decreased during the mid-stage trial of its cancer drug that is used in combination with Opdivo from Bristol-Myers Squibb.

Shares of Nektar plunged at one point by 36%, but the company, based in San Francisco sought to give assurance to its investors that responses would become better as patients were added into the second part of the same study and remained on the cancer treatment longer.

It needs to be looked at as must a snapshot, a moment in time, said the CSO at Nektar Jonathan Zalevsky during an interview in Chicago. We have much confidence based upon our data that over time the response rates will improve.

Analysts remained optimistic as well. One industry analyst who had a buy rating for Nektar shares said it could be better if the combo was evaluated in a couple of months after the trial’s patients have received the treatment eight months.

Another analyst said the jury remains out, but responses in the PD-L1 negative patients, who do not typically respond that well to just the use of Opdivo, and the continued deepening of the responses is compelling.

One more analyst said that the collaboration with Nektar makes good sense for Bristol-Myers and that the drug combo is likely to progress into trails. The regimen remains very active in patients that have tumors that are negative for PD-L1 protein, both in kidney and melanoma cancer, said the analyst.

An investigator in the study from Yale Cancer Center, says he agrees that this data are sufficient enough to move to the final testing stage generally required to get regulatory approval in the U.S. However, he cautioned that it is not yet known whether this combo of drugs would improve or lengthen the lives of patients in a significant way.

The investigator said that the drug did what it is supposed to, but there is no way in concluding that it is better until the randomized trial is performed.