Shares of biotechnology company Arcturus Therapeutics Holdings Inc. fell 55 percent on Tuesday as investors responded to the results of a phase 1/2 study of his COVID-19 vaccine candidate that an analyst said was disappointing.
Arcturus ARCT based in San Diego,
said late Monday that it had received approval from the Singapore Health Sciences Authority to continue a phase 2 study of its candidate candidate ARCT-021, which will enroll up to 600 volunteers.
Approval is based on data from phase 1/2 of studies that showed that the vaccine produces neutralizing antibodies after a dose, albeit at lower levels than rival candidates. Arcturus hopes that his vaccine will not require a booster shot, making it easier to administer than vaccines that require two doses.
The company aims to generate phase 2 intermediate data in early 2021 that will determine the optimal dosage and begin a global phase 3 study in the second quarter of 2021.
Raymond James downgraded Arcturus shares to market performance from superior to news and said the data was “overwhelming”.
“While the latter data set does not completely affect single-stroke ARCT-021, which may provide protection against COVID-19 infection in phase 3, the lack of neutralizing antibody titers SARS-CoV-2 (NAb) at or above observed in the greenhouse reduces our confidence that ARCT-021 will be able to achieve competitive levels of single-injection vaccine efficacy, ”analysts led by Stephen Seedhouse wrote in a note to clients. “At the very least, the question will be asked by the market and unanswered until phase 3, thus limiting short-term growth and justifying a market performance rating.”
Neutralizing antibody titers entered the lower end of the range of convalescent plasma titers observed with vaccines developed by Pfizer Inc. FE,
with the German partner BioNTech SE BNTX,
and Moderna Inc. mRNA,
he said. These vaccines have received an emergency use authorization from the US Food and Drug Administration and are currently being released in the United States and other countries.
These vaccines have been shown to be about 90 percent effective, while Arcturus is potentially as low as about 62 percent, Seedhouse said.
“We recognize that achieving north of 60% single-dose EV would be a decent result for the RNA mechanism and make ARCT-021 a viable vaccine (at least as competitive as AZD1222), given the massive global demand.” , he wrote. “But this level of NAb titles… does not support the more optimistic outlook we had previously for ARCT-021… is not competitive with Pfizer / Moderna and… will not make ARCT-021 a preferred vaccine in the US”
Arcturus shares gained 280% in 2020, while SPDR S&P Biotech ETF XBI,
won 50% and the S&P 500 SPX,
increased by 16%.