Hammered by critics, NewLink strikes back with positive PhII indoximod data — and shares rocket up

Few biotechs have inspired the kind of love-hate relationship that NewLink Genetics $NLNK seems to provoke among the bulls and bears in the biotech investment community following its IDO work with passionate self-interest.

Earlier this year, the sentiment ran distinctly along the bear/hate argument, born out by some disappointing data and Genentech’s decision to punt their partnered IDO1 therapy. It also didn’t help that their cancer vaccine flopped badly in 2016.

Today, though, was mostly about good loving, as NewLink shares shot up 75% by the close.

Charles Link, NewLink

What caused this sudden euphoria?

Looking to prove that its drug indoximod can amp up the efficacy of Merck’s checkpoint therapy Keytruda in fighting melanoma, researchers rolled out a new set of data that touted an increase in the complete response rate from 12% to 20%, an overall response rate of 61% and a disease control rate of 80%. The median progression-free survival rate was recorded at 12.9 months.

It’s all data from a small Phase II data which the short crowd loves to criticize as often as they can, citing various design flaws and cherry picking. It’s also a long way from the pivotal melanoma study, which will recruit 600 patients for sometime in 2018, using both Keytruda and Opdivo.

“Our team is excited to move forward with this pivotal trial,” said Eugene Kennedy, the VP of medical affairs at NewLink. “We believe that allowing physicians the choice of either pembrolizumab or nivolumab accurately reflects current clinical care and should aid in enrolling the trial by the end of 2018.”

It’s important to remember that this is not an IDO1 drug. NewLink only knows that it works along the IDO pathway, separate from the enzymatic specific group, which includes Incyte’s leading epacadostat.

This argument isn’t nearly over. The only thing that will finally stop it will be definitive pivotal results.

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Research Scientist - Immunology
Recursion Pharmaceuticals Salt Lake City, UT
Director of Operations
Atlas Venture Cambridge, MA

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