Puma Biotechnology Falls on Disappointing Neratinib Data – Analyst Blog

Puma Biotechnology, Inc. 's ( PBYI ) shares lost 9.7% immediately after the company announced the top-line results from a randomized, two-arm, phase II study (NEfERTT) on its lead candidate, neratinib. Neratinib, in combination with paclitaxel, failed to show significant improvement in progression free survival (PFS) in patients suffering from first-line HER2-positive locally recurrent or metastatic breast cancer when compared to paclitaxel plus Roche's ( RHHBY ) Herceptin.

The primary endpoint of the NEfERTT study was PFS. In this study, patients were randomized to receive first-line treatment with paclitaxel plus neratinib or paclitaxel plus Herceptin. Results showed that patients treated with paclitaxel plus neratinib achieved a PFS of 16.6 months while patients receiving paclitaxel plus Herceptin achieved a PFS of 16.7 months.

However, the company stated that the incidence of central nervous system metastases in the patients treated with paclitaxel-neratinib combination was reduced by 52.6% than those treated with paclitaxel plus Herceptin. Detailed data from the NEfERTT study will be available in 2015.

We note that Puma Biotechnology has a licensing agreement with Pfizer ( PFE ) for neratinib.

Our Take

We are disappointed by the top-line results from the NEfERTT study. Neratinib being the primary candidate at Puma Biotechnology, failure to establish its superiority over paclitaxel plus Herceptin is a major setback for the company. With no approved products in its portfolio currently, the company's growth prospect is heavily dependent on the development of neratinib.

Meanwhile, Puma Biotechnology is also evaluating neratinib for the treatment of patients suffering from non small cell lung cancer, breast cancer and other solid tumors with HER2 mutation.

We remind investors that Roche is a dominating player in the breast cancer market with drugs like Herceptin, Perjeta and Kadcyla.

Puma Biotechnology carries a Zacks Rank #4 (Sell). A better-ranked stock in the biotech sector is Biogen Idec Inc ( BIIB ), carrying a Zacks Rank #1 (Strong Buy).

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Puma Biotechnology Falls on Disappointing Neratinib Data - Analyst Blog