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Text |Amino observations.How volatile can a pharmaceutical company's stock price be?
The answer to this question seems to be less important after being accustomed to the aesthetics of violence in the world of innovative drugs.
However, when AMBRX completed the 71-fold skyrocketing journey in only 13 months, everyone was still amazed by the extreme risks and benefits of innovative drugs.
In the case of AMBRX, the reversal drama has been staged repeatedly.
After going public in June 2021, AMBRX's stock price went all the way down after a brief rush period, and in a year and a half, the stock price almost fell to zero, falling from $18 at the opening to less than $1, hovering on the verge of delisting.
On December 8, 2022, AMBRX just hit an all-time low of 038 US dollars, and the next day it soared by 1008% due to excellent clinical data;
On January 8, 2024, after the news of Johnson & Johnson's $100 million acquisition of AMBRX came out, the latter's stock price soared 1015%。
AMBRX shares are up more than 1,110% year-to-date, and more ......than 7,100% from the lowest point in December 2022
I'm afraid the movie doesn't dare to act like this. The violent reversal of AMBRX is a microcosm of the gap between capital market expectations and biotechnology reality.
As we all know, failure is the norm in this industry, but it is also the endless failure, which eliminates one wrong option after another, and ultimately pushes the prosperity of the entire industry upward.
But the secondary market is always love-hate, and sometimes even reacts too quickly. When the company's clinical data is excellent and continues to rise, it will never hesitate to buy and buy in one goOnce the clinical signs are wrong, quickly withdraw and leave, and never wait and see. And when the reversal comes unexpectedly, the market will come again with salaries, adding fuel to the fire.
At present, when the U.S. stock biotechnology continues, the domestic market is still sluggish, and many innovative pharmaceutical companies are also like AMBRX, whose stock prices have fallen again and again, but the wind is not complete, and the rainstorm is not over.
The industry will not wither easily, and the truly excellent enterprises will not fall easily. The pessimistic moment has been experienced countless times in the past, and it is always to underestimate the huge amount of energy accumulated by innovative pharmaceutical companies, and there are always more ways than difficulties, and the reversal may be in an instant.
As both fundamentals and macros continue to accumulate positive momentum, there should perhaps be more positive and optimistic about the potential performance in 2024.
As the first case of Chinese capital acquiring an innovative American pharmaceutical company, AMBRX has received a lot of attention from the market in the past few years.
AMBRX is a company that dates back to 2003. At the time, AMBRX was spun off from the Scripps Research Institute, a private, not-for-profit biomedical research institute founded in 1924 and one of the few world-leading centers.
AMBRX has pioneered the world's first technology platform for site-specific integration of unnatural amino acids into protein peptide chains within cells. Compared with traditional ADC drugs, the introduction of non-natural amino acids of antibodies and drug linkers can achieve fixed-point and quantitative conjugation, and the obtained ADCs have high efficacy, good stability, high safety, and uniform drug-to-drug ratio (DAR), but there are also problems such as difficulty in antibody expression and possible immunogenicity.
With its unique technology platform, AMBRX has established partnerships with Bristol-Myers Squibb, Eli Lilly, Astellas and other giants in its early years.
In 2014, AMBRX planned to list on the NASDAQ, but it was abandoned due to a sluggish market and undervalued prices. In June 2015, AMBRX was acquired by a Chinese consortium.
In June 2015, led by Fosun Pharma, it formed an alliance with Hopu Investment, China Everbright Healthcare** and WuXi AppTec to jointly acquire AMBRX. After being acquired by a Chinese consortium, Ambrx's management has also undergone a certain change, and most of the company's senior executives are Chinese.
At the same time, AMBRX has also become more and more closely cooperating with China, reaching cooperation agreements with BeiGene and Sinobio Pharmaceutical in 2019 and 2020 respectively on their technology platforms.
As early as 2023, AMBRX reached a cooperation agreement with Zhejiang Pharmaceutical on the now well-known HER2-ADC ARX788.
Under the agreement, AMBRX retains commercial rights outside of China and receives royalties on products sold in China. Currently, the development and commercialization of ARX788 is attributable to Newcode Biotech, a subsidiary of Zhejiang Pharmaceutical. In October 2019, AMBRX and Newcode Biosciences announced that they had reached a second collaboration to jointly develop ARX305, an ADC for CD70-positive tumors developed by AMBRX on the same technology platform.
Although Newcode Biotech only has the commercialization rights of these two products in China, this does not prevent it from becoming a popular fried chicken in the primary market.
In March 2021, the new code biology completed 41.5 billion yuan in Series A financing, with a valuation of 176.5 billion yuan;In July 2022, Newcode Biotech completed another Series B financing, raising 40.1 billion yuan, over-raised 100 million yuan, and the post-investment valuation increased by 72% compared with the A round to 309.7 billion yuan.
These two points are enough to show that the new code biology is very popular in the primary market. However, on the other side of the ocean, AMBRX, the treatment is diametrically opposite.
Since its listing in June 2021, AMBRX's share price has gone down after a brief boom.
As we all know, since 2021, the global biotechnology industry has begun to turn from bulls to bears, and the American Biotech ETF-SPDR (XBI) has turned downward since hitting a record high in February 2021, experiencing the most tragic wave since the last century**, falling by more than 64% to the lowest point in May 2022.
Like all biotech in China, AMBRX is not immune to the fact that it has experienced a period of darkness when the stars fell into the sea. In the year and a half since going public, AMBRX shares have fallen to almost zero, falling from $18 at the opening to as low as 0$38 shares, hovering on the verge of delisting.
On the surface, AMBRX is not at the right time to go public. But this is actually a case caused by DS-8201**.
At that time, the core pipeline of AMBRX, which was also the fastest in R&D, was ARX788, an ADC drug candidate targeting HER2.
In the past two years, everyone knows the story that happened in the HER2 ADC track. With the advent of the DS-8201, all HER2 ADC players are starting to get on pins and needles, including AMBRX.
Because DS-8201 is too powerful, it has successfully defeated the second-generation ADC drug TDM-1 and has become the first choice for second-line breast cancer in Europe and the United States.
From the date of listing, DS-8201 has won multiple indications in the field of breast cancer and gastric cancer with the trend of "tornado destroying parking lots", and sales surpassing TDM-1 are just around the corner.
AMBRX's ARX788 clinical trial target is TDM-1, but compared to the rapid development of DS-8201, ARX788 has not released clinical data for a long time. This also makes its stock price almost impossible in the process.
Finally, in October 2022, AMBRX voluntarily announced that it would suspend the research and development of ARX788 and use ARX517, a new PSMA ADC drug, as the first pipeline. This is an ADC drug for metastatic castration-tolerant cancer prostate cancer (MCRPC) with the potential for FIC.
The core reason for the suspension of ARX788 is that the company believes that the market landscape of HER-2 ADC drugs has changed after analysis.
Although the early data for ARX788 were positive, the ACE-Breast-01 trial previously confirmed that 16 of the 29 HER2-positive breast cancer patients who received ARX788** (66%) had an ORR. In 1The disease control rate (DCR) observed in the 5 mg kg cohort was 100%. This study showed that ARX788 was well tolerated overall, with most adverse events being grade 1 or 2 and manageable.
However, in the face of DS-8201, AMBRX does not seem to have much confidence, so it chooses to suspend overseas clinical trials and continue to advance the clinical trials in China by Xinma Biologics.
At the same time, AMBRX also announced a 15% layoff in order to retain more capital to keep the company afloat. But after this series of operations, investors' confidence in AMBRX fell to a low point, and the stock price went all the way to the lowest point on December 8, 0.$38 stocks, down 98% from their highs.
Everything has a cycle, booming and declining, or the pole is coming. Almost on the same day, the tide began to turn.
After the darkest day after the launch, AMBRX waited for good luck.
On December 9, 2022, AMBRX presented data from the Phase II clinical trial of ARX788 at the SABCS meeting, which showed an objective response rate of 57 in patients with metastatic breast cancer who have progressed after T-DM1**1%。
After the clinical data was revealed, AMBRX shares rose by 1007 in a single day59%。After the surge, its stock price reached 4$54 shares, market capitalization is only 2$900 million. In the following two months, the stock price fell back to around $2 and was in a sideways state.
The core is that although the data of ARX788 is good, the existence of DS-8201 still greatly compresses its future value. After all, T-DM1 will be squeezed by DS-8201, and the scale of drug-resistant patients will naturally shrink.
Fortunately, AMBRX also has ARX517.
This is an ADC drug that targets prostate-specific membrane antigen (PSMA). PSMA is highly expressed (>89%) in metastatic castration-resistant prostate cancer (MCRPC) and is a validated** target.
On February 16, 2023, AMBRX announced positive Phase 1 clinical data for ARX517, and its stock price rose 53% on the same day. This is also the beginning of AMBRX's bottoming**.
Half a month later, Zhejiang Medicine announced that ARX788, developed by Xinma Biologics, had reached the primary efficacy endpoint in the scheduled interim analysis of the pivotal clinical ACE-Breast-02 study. Based on this result, Newcode Biotech intends to apply for early termination of the study and submit a new drug application to the CDE.
In addition to the joy, the new code biology also needs to solve the positioning problem of ARX788.
DS-8201 has been approved for marketing in China, and the situation that Ambrx once feared will also become a problem for the new code bio.
In the ACE-Breast-02 trial announced by Zhejiang Medicine, the control group was lapatinib combined with capecitabine. The positive results do not prove that it can compete with DS-8201.
Although AMBRX's CEO said in a press release, the positive results of this large Phase 3 study further support its case for developing ARX788**HER2-positive breast cancer patients globally.
But that doesn't change the fact that the rise of the DS-8201 is still a great challenge for the ARX788.
This can be seen from AMBRX's clinical program. Following the announcement of the successful Phase II and Phase III clinical trial of ARX788, the Company plans to initiate a Phase II clinical trial of DS-8201 with plans to enroll 30 patients and initiate a registrational clinical study if the ORR reaches 20-30%.
Of course, the focus of the market has long since shifted to the ARX517.
On November 28, AMBRX announced the latest clinical data of ARX517 in the Phase 1 Phase 2 dose escalation and expansion clinical trial of APEX-01**MCRPC.
The head of the company said that in 2A significant decrease in PSA50 and a long-term ** effect were observed in patients at a dose of 0 mg kg, while with a dose of 3There were no DLTs (dose-limiting toxicities) or serious adverse events (SAES) at the 4mg kg dose, and the safety monitoring committee has voted to escalate the dose to 45mg/kg。
The smaller toxicity*** allows ARX517 to unlock larger doses, meaning that the drug has great potential for the future.
Johnson & Johnson's acquisition of AMBRX at a premium, from the company's external statement, it is not difficult to see that it is interested in ARX517.
"AMBRX's ADC technology offers a unique advantage in the binding of stable antibodies and cytotoxic linker payloads, which leads to engineering that effectively kills cancer cells and limits toxicity," said Yusri Elsayed, Global Area Leader at Johnson & Johnson Oncology. To date, the results of ARX517 in MCRPC are promising, representing a potential first- and best-class approach to target this aggressive disease. ”
According to Johnson & Johnson, there are 18 in the MCRPC field50,000 patients is a huge market, and it is believed that ARX517 has the potential to become a FIC and BIC product.
Although AMBRX's ADC platform has obvious shortcomings in the eyes of some market participants, Johnson & Johnson is very satisfied with the transaction.
Just before Johnson & Johnson announced the acquisition, AMBRX's stock price was slightly higher due to the clinical data of ARX517, but it still hovered around $13, with a total market value of only about $900 million.
When the news of Johnson & Johnson's $2 billion acquisition of AMBRX came out, the latter's stock price soared by 1015%。Since the beginning of last year, its share price has risen by more than 1,110%, and if you look at the lowest point of the stock price in December 2022, it has risen by more than 7,100% ......
It's a reversal of the century.
Looking back, in the process of AMBRX's stock price reversal, AMBRX has been boosting the downturn with new clinical data every time**, and capital is willing to pay for it.
It's not hard to see why. The secondary market is always a love-hate affair and sometimes even reacts too quickly.
When the company's clinical data is excellent and continues to rise, it will never hesitate to buy and buy in one goOnce the clinical signs are wrong, quickly withdraw and leave, and never wait and see. And when the reversal comes unexpectedly, the market will come again with salaries, adding fuel to the fire.
Back to China, since the second half of 2021, the pessimism of the entire market has prevailed, and the systematic unilateral *** excellent companies that have been in the mud and sand have not been spared, and many innovative pharmaceutical companies have fallen to historical lows like AMBRX.
Despite the great uncertainty of innovation, there is no shortage of failure stories for the industry as a whole. But it is precisely the endless failures that eliminate one wrong option after another, and ultimately propel the entire industry to prosperity.
The example of AMBRX also shows us that product power is the last word, and at any time, for innovators, it should not be defined by the current downturn or a failure.
At the end of December 2020, Masayoshi Son, who came out of the trough of his life, tweeted that good luck is always followed by bad luck, and it is important not to be discouraged at that time.
At present, when the U.S. stock biotechnology continues, the domestic market is still sluggish, but the wind is not over, and the rainstorm does not end.
The industry will not wither easily, and the truly excellent enterprises will not fall easily. The pessimistic moment has been experienced countless times in the past, and it is always to underestimate the huge amount of energy accumulated by innovative pharmaceutical companies, and there are always more ways than difficulties, and the reversal may be in an instant.
So, are you ready?