MW Geron's stock soars 95% after FDA advisory panel votes in favor of blood-disorder drug
By Ciara Linnane
Panel finds benefits of the drug outweigh the risks; FDA due to make final decision by June 16
Geron Corp.'s stock rose 95% Friday, after an advisory panel to the Food and Drug Administration voted 12-to-2 in favor of the company's blood-disorder drug imetelstat and said its benefits outweigh the risks.
The stock $(GERN)$ was on track for its biggest one-day gain in 21 years on heavy volume. Some 61 million shares had changed hands by midmorning, more than 7.6 times the average volume over the past 65 days.
The vote came after a panel meeting to discuss the efficacy and safety of the injectable treatment based on data from a phase 3 trial. In the briefing document for the meeting, the FDA had reiterated a series of safety concerns and questioned the benefits the drug offers to patients.
Geron is seeking approval of imetelstat as a treatment for transfusion-dependent anemia in patients suffering from low-risk myelodysplastic syndromes, or MDS - a group of related and rare blood cancers where a patient doesn't have enough healthy blood cells and platelets.
But the panel, comprised of oncologists and hematologists, rejected the FDA's concerns, and noted that the trial had shown significantly higher rates of RBC-TI, or red-blood-cell transfusion independence, than those taking a placebo.
Panel members emphasized that RBC-TI is the most important quality-of-life metric for patients suffering from MDS.
The discussion largely focused on the high level of cytopenia, or low red-blood-cell count, in trial participants. Geron said that side effect was not uncommon and experts said doctors know how to treat it.
"There are few treatment options and significant unmet medical need remains for these patients, particularly among those with difficult-to-treat subtypes of this blood cancer," said Dr. Faye Feller, Geron's chief medical officer, in a statement.
Wedbush analysts welcomed the positive vote and said they continue to expect approval of the drug by June. The FDA is scheduled to make a final decision by June 16. After that, analysts led by Robert Driscoll see "robust commercial potential."
Stifel analysts agreed and said they are modeling a 95% possibility of success for the drug.
"We expect the Geron discussion to now shift to labeling (a boxed warning would have no impact on our estimates), launch kinetics and strategic interest specifically as it pertains to imetelstat's potential exclusivity runway," analysts led by Stephen D. Willey wrote in a note.
If approved, imetelstat would become the biotech company's first approved product and will compete with Bristol-Myers Squibb Co.'s Reblozyl. That drug won an expanded indication from the FDA last year as a treatment for transfusion-dependent anemia in low-risk MDS.
Bristol-Myers Squibb $(BMY)$ is developing Reblozyl via a collaboration with Merck & Co. Inc. $(MRK)$ following Merck's takeover of Acceleron Pharma in late 2021. The company reported a 41% rise in Reblozyl revenue in 2022, to $1 billion.
The FDA is not obliged to follow the recommendations of its advisory panels, but often does.
All five analysts that cover Geron's stock on FactSet rate it a buy or equivalent. The stock has gained 60% in the year to date, while the SPDR S&P Biotech ETF XBI has gained 5.9% and the S&P 500 SPX has gained 7.4%.
-Ciara Linnane
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March 15, 2024 11:50 ET (15:50 GMT)
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