Per reporter: Cai Ding Per editor: Lan Suying
The "myth" of soaring dozens of times in just one trading day has once again played out in the US stock market.
On Wednesday (October 11), Eastern time, shares of California-based biotechnology company Tempest Therapeutics, Inc. (hereinafter referred to as Tempest) closed up nearly 4,000%. As much as $500 million poured in, pushing the company's market value from less than $2.3 million to $130 million.
Behind this excitement is Tempest's newly announced positive results in global clinical trials of its oral, selective PPARα small molecule antagonist TPST-1120. The TPST-1120 regimen with two other drugs significantly improved progression-free survival (PFS) in patients with unresectable hepatocellular carcinoma (uHCC) by more than 60 percent. Tempest also said it is also currently evaluating TPST-1120 as a single agent or combination therapy in other oncology indications in a separate early-stage interim study.
3970.83%！ The breakthrough in liver cancer therapy stimulates Tempest's skyrocketing
Founded in 2011, Tempest is a clinical-stage oncology company. On the trading day before the surge (this Tuesday, October 10), the company's share price also hit a record low of $0.17, corresponding to a market value of only $2.2644 million. The market capitalization of less than $2.3 million also partly reflects investor expectations.
But such a little-known company has ushered in a surprising reversal.
On October 11, local time, Tempest announced the latest positive results obtained in the global randomized clinical trial of TPST-1120 developed by Tempest. TPST-1120 is an oral, selective PPARα small molecule antagonist.
Tempest published results showing that a "triple regimen" consisting of TPST-1120 with atezolizumab (a humanized monoclonal antibody that blocks PD-L1) and bevacizumab (a vascular targeted drug) significantly improved progression-free survival (PFS) in patients with unresectable hepatocellular carcinoma (uHCC). In terms of data, compared with the two "standard treatment regimens" of atezolizumab and bevacizumab, the "triple treatment regimen" increased the PFS of patients by more than 60%. (Note: Progression-free survival refers to "the length of time a patient develops the disease during and after treatment for a disease such as cancer without worsening.")
As soon as the results were announced, Tempest's share price soared, closing the day up 3,970.83% to $6.98 per share as of October 11. More than $500 million poured into Tempest, and the market value rushed to $130 million, which shows how crazy the market is. The "Daily Economic News" reporter also noted that Tempest also announced a "poison pill plan" on the same day, aiming to deal with potential acquisition threats. Under the scheme, shareholders are only entitled to exercise shareholder interests if an outside entity offers to acquire 10% or more of the company's outstanding common shares.
Tempest skyrocketed nearly 40 times on Wednesday (Image: Tempest)
Matt Phipps, an analyst at William Blair, a U.S. investment bank, said Tempest's "valuation before the data was almost unbelievably low was almost unbelievably low because investors were skeptical of previous Tempest's findings." He wrote in a note on Wednesday that "the company's valuation is clearly still undervalued in terms of the opportunity for its anti-liver cancer drugs."
Analysts covering Tempest are generally bullish on the company, with four analysts rating it as buy, according to Bloomberg data. In addition, the average of Tempest's three price targets given by analysts suggests that the stock could more than quadruple from its current level of $4 per share.
Pan Guinness, an analyst at HC Wainwright & Co., another investment bank, also expects Tempest to ride the wind, with a market capitalization of around $770 million. But Panguinis said his valuation was based on a 25 percent chance of trial success, which he called "conservative." He raised his price target this week to $47, the highest of the three analysts' price targets. He believes that in terms of the market for liver cancer therapeutics and the potential for the company's drugs to be part of the first-line treatment of liver cancer patients, "Tempest's huge upside potential remains." As of Friday, Tempest closed at $3.64.
Liver cancer is one of the malignancies with the lowest 5-year survival rate
According to the International Agency for Research on Cancer, in 2020, more than 900,000 people worldwide suffered from liver cancer, and nearly 830,000 died of liver cancer; Assuming current morbidity and mortality rates remain unchanged, scientists estimate that 1.4 million people could be diagnosed with liver cancer and 1.3 million die in 2040.
Studies have pointed out that primary liver cancer is the sixth most common cancer and the fourth leading cause of cancer death in the world. From 2007 to 2016, the incidence of liver cancer increased at a rate of 2%~3% per year, and the mortality rate also increased rapidly, gradually leveling off in recent years, but liver cancer is still one of the malignant tumors with the lowest 5-year survival rate (18%), and the number of new cases of primary liver cancer in 2020 has exceeded 900,000, and the number of deaths is about 830,000. It is estimated that after 2025, more than 1 million people will be affected by liver cancer worldwide each year.
That's why Tempest's latest research data has attracted so much attention in the capital markets. Moreover, the combination therapy of atezolizumab + bevacizumab is the first FDA-approved cancer immunotherapy regimen for the treatment of uHCC. Therefore, the improvement in clinical data of the "triple regimen" combined with TPST-1120 is even more exciting.
The Tempest trial results were based on a treatment follow-up analysis of 70 patients, of whom 40 were randomized to the "triple regimen" group and 30 patients were assigned to the "standard regimen", with a median follow-up of 9.2 and 9.9 months, respectively.
The company said that the median duration of PFS for uHCC patients after treatment with the "triple regimen" was 7 months, compared with 4.3 months for uHCC patients who received only the "standard regimen."
Image source: Tempest
Tempest also said the "triple regimen" group also improved in multiple categories. The data showed that the confirmed objective response rate (ORR) of the "triple regimen" was 30%, while the ORR of the "standard regimen" control group was only 13.3%.
Stephen Brady, CEO of the company, said in an official statement, "A comprehensive analysis of more mature clinical data indicates that early and interim analysis of triple therapy has greater benefits compared with standard treatment regimens alone, presumably due to the mechanism of action of TPST-1120 in it." ”
Brady added, "Based on these data, we are excited about the opportunity to include TPST-1120 in pivotal research. We look forward to advancing discussions with potential partners who share our TPST-1120 vision." ”
Globally, the current treatment of liver cancer faces many challenges and bottlenecks. For example, early diagnosis of liver cancer is difficult, liver cancer cells have congenital drug resistance, the pathogenesis of liver cancer is complex and diverse, and it is impossible to accurately assess the prognosis and treatment response of patients.
In order to improve the quality of life and prolong the survival of liver cancer patients, some new progress has been made in the diagnosis, staging and treatment of liver cancer at home and abroad in recent years. For example, in imaging examination, ultrasonography, CT/MRI dynamic enhancement and other technologies can improve the detection rate and differential diagnosis ability of liver cancer. In terms of molecular testing, genetic testing based on blood or tissue samples can reveal the molecular characteristics and target information of liver cancer, etc.
In this context, if the "triple treatment plan" can finally be widely recognized and applied, it will bring a new dawn to liver cancer patients around the world.
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