JP Morgan 2017 – What to watch for…

Celgene as bellwether

Whether or not there are any sizeable pre-conference deals announced when Wall Street opens on Monday morning, Celgene is poised to shape investor sentiment during the early stages of 2017. As it does every January in San Francisco, the large-cap biotech is expected to update its full year and 2020 guidance during the first presentation at JPM. Management issued prior 2017 guidance in October and expects revenues this year close to $13 billion. Consensus forecasts already exceed this target, however, and investors – at the very least – will be looking for more colour on the growth trajectory for flagship drug Revlimid; sales of which are expected to grow to around $8 billion. 

Vertex takes cautious view

Pressure on Celgene to deliver some positive news may have increased thanks to pre-conference guidance issued by Vertex on Sunday. The company issued full-year revenue guidance for its newer cystic fibrosis treatment Orkambi of $1.1 billion to $1.3 billion; the mid-point of which is some 17 percent below current consensus forecasts. Potentially slow European reimbursement of Orkambi is partly to blame, with management also appearing keen to avoid a repeat of last year's revenue downgrade in August. Investors will be eager for any updates on Vertex's triple combination cystic fibrosis therapies, with Phase II data due to be presented in the second half of 2017.

Spotlight On: Competition may not be the only thing that Vertex has to fear

Recent upheaval at Alexion

Alexion's share price has recovered to a six-month high following the announcement in November it had launched an investigation into sales practises for its flagship drug Soliris and the subsequent departure of its CEO and CFO in early December. Last week, the company played down any meaningful implications stemming from the investigation and confirmed it will not be required to revise any previously reported earnings. Investors may, nevertheless, appreciate additional feedback from interim CEO David Brennan regarding the investigation and any information regarding his permanent successor.

Gilead – when will they buy?

Gilead faced a growing pressure to embark on large scale M&A last year and 2017 will be no different, particularly as consolidation is widely viewed as the best type of sector tailwind. Whether Gilead will announce any material updates remains unclear, but the recent hire of Alessandro Riva – from Novartis – to head up its haematology and oncology business unit will provide investors one angle for questioning.

[Ipsen got the M&A ball rolling with its $575 million deal to acquire Merrimack's US marketing rights for the pancreatic cancer treatment Onivyde which was announced late on Sunday. The acquisition – potentially worth $1 billion – is designed to enhance Ipsen's US oncology presence and provided Merrimack necessary funds to complete a previously announced restructuring]

Mysterious Moderna – a glimpse behind the curtain?

Known predominantly for its hugely successful fundraising efforts, privately-owned mRNA specialist Moderna has attracted some scrutiny over the past 12 months, thanks in part to the secretive nature of its research. What incremental insight CEO Stephane Bancel provides on the company’s pipeline when he presents at JPM on Monday remains conjecture at this point but Moderna's presence at the conference has already increased speculation it will shortly announce an IPO.

Regeneron – Dupixent likely to be the focus

Regeneron investors are currently weighing up the good – pending approval and launch of Dupixent – with the not so good – a recent district court ruling which threatens to see one of its two marketed products, Praluent, withdrawn from the US market. With Dupixent, a novel treatment for moderate-to-severe atopic dermatitis, appearing to be a shoe-in blockbuster product, uncertainty over the future of Regeneron's PCSK-9 inhibitor notably changes the company's short term outlook.

Brand new Biogen?

The JP Morgan conference will provide new Biogen CEO Michael Vounatsos a baptism of fire on multiple accounts; investors will be keen to see an update on the company's growth strategy, will be looking to see if Vounatsos impresses given his lack of prior CEO experience and may question the sensibility of Biogen's pricing strategy for the newly approved spinal muscular atrophy (SMA) treatment Spinraza.  

Sarepta's sales update

With Sarepta having pulled off a notable coup by securing FDA approval for its Duchene muscular dystrophy (DMD) treatment Exondys 51 last year, investors are now keen to see how the drug performs commercially. The company's share price is down 51 percent from an early-October high, in part due to growing concerns that insurance companies will not reimburse Exondys. Any update on the drug's launch is therefore keenly anticipated.

Roche – an important year ahead

Among Big Pharma it is arguably Roche which has the most catalyst-rich 2017. Investors can only wait for outcome of the APHINITY study (Herceptin plus Perjeta in adjuvant HER-2 positive breast cancer) but will be looking for pre-launch updates regarding Ocrevus in multiple sclerosis and any additional information regarding newly released Phase II data for emicizumab (KOL Views: Leading haematologist suggests those finding fault with emicizumab’s Phase III may be trying too hard) New launches remain important given both Roche's reputation for R&D innovation the shadow cast by potential biosimilar competition to its key oncology franchises. 

Kite Pharma/Juno – CAR-T race

The former has taken a significant lead over the latter in the race to deliver a first CAR-T therapy to market. While Kite investors will be looking for any updates on a critical year ahead which will see KTE-C19 move into the regulatory arena, Juno will be probed on the future of JCAR015 and whether JCAR017 will become its mist advanced CAR-T asset.

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