NKTR down 23%

NKTR down over 23% in pre-market to 69.50.

I’m looking for news…don’t see any as of yet.

Anyone know what happened?

– This…is the MaineReason
Long NKTR

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JP Morgan analyst downgraded the stock and lowered her price target based on what she regarded as “mixed results” reported over the weekend for the combination of NKTR-214 with Bristol Myers’ Opdivo.

https://www.cnbc.com/2018/06/03/reuters-america-mixed-result…

I am underwater in Nektar but I decided to pick up some more shares in the pre-market at $68.50 in the hope of scalping them.

Andrew
(who also is Long NKTR)

Yes, I just saw a similar link to that news and was about to post it.

– This…is the MaineReason
Long NKTR

https://endpts.com/nektar-wants-everyone-to-stay-calm-as-the…

“My take on the Nektar data is that it just became the biggest battleground in biotech. Either you believe 1) the new patients from the phase two expansions will turn into responses with time or 2) phase one was a low n mirage. We’ll only know with time.”

Yep.

We’ll see in October. Will be an interesting options play.

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Had a low bid at 78 out there. Filled. Also bought shares at 65. Over wieght.

Figure it is a gift.

Cheers
Qazulight

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I added some at $69.99, and some more at $64.90, but I have enough now and won’t add any more.

In my naive opinion, this is ridiculous, and simply a misunderstanding of what they reported. If the patients improve gradually over months, of course when you add new patients the overall response rate drops when you add in those patients who have just started on treatment…duh!

But we’ll just have to see where this goes.

Saul

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I added more just now at $64.90.

Best to us all.

– This…is the MaineReason
Long (more so now) NKTR

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I started a position at 65

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I hope someone with excellent insight and the bona fides to know what is causing this huge drop can weigh in.

Looking like a great opportunity, so why the landslide sell orders?

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3-day rule! Enter slowly, boys and girls. Save some powder for Wednesday-Thursday.

KC

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I bought a nice chunk at $56.07.

Making trades in the after market is more risky than options! You guys got an itchy trigger finger maybe.

Dominic
Wishing good luck to all NKTR longs and thinks in 5 years we won’t even remember this sell off

Decent summary on SA here: https://seekingalpha.com/news/3361297-nektar-24-percent-prem…

As folks have mentioned, great results in first group (11 of 13); street/computers focusing on the decline in second group.

Also as mentioned, tread lightly over the next couple of days, should be a fun ride over the next month or so.

Sox

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Here is a great article that discusses how the ASCO results relate to the selloff.

https://endpts.com/nektar-wants-everyone-to-stay-calm-as-the…

The article mentions the issue Saul noted, that response rate takes more time to appear than is indicated by the numbers taken without context. Adjusted for the new patients, the numbers look promising but really nothing will be known for certain until October (November?).

Aside from this, a few normal factors are probably driving the price down artificially: margin calls, trading algorithms, and day traders.

I added at $55.25…

A 40% drop on what I read as “steady, progressing results”… They have good response on folks that have been on the combo of meds for a sustained time. This is the Rule of Small numbers at work… their sample size is so low that adding 11 new people to the study dramatically changes the top line results. Thus the market reacts to a top line result change headline.

My opinion… we shall see.

Mark

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Where’s Bert to write a nice NKTR article when we need him??

LOL

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I will look at the data tonight. I wanted to over the weekend but life happened. I did glance at it Saturday and thought it looked pretty good for what appears to be about 4-5 months of treatment on average and only 1 scan for a number of patients. I’ll dig into it tonight if call doesn’t suck.

MC

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I added a little this morning and saw HC Wainwright Reiterates Therapeutics Buy Rating; Lowers PT to $97 From $125 dated this morning.

Kindest Regards,
Steve

MC really look forward to your take. I picked up more at 52 dollars just now. I am simply amazed at some of these analysts. We all know how hard it is to place a value on a company like this and for some person to look at these results and say, “it looks rather ambiguous to me” would make sense, but to say, “the company is now worth 73 dollars a share as opposed to 91.50” or some such nonsense is crazy.
How do you get one of those jobs? I have no idea how much NKTR might be worth if and when some of their drugs are approved, but these people are so sloppy it is sad.
Just my thoughts
Mike

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All,

I am by no means an expert on price action, and I am probably too upbeat on NKTR (as upbeat as I am now underwater), but I listened to the entire investors presentation (nearly 2 hours), which is much more in depth than the 10 minute ASCO talk. It is available on NKTR website.

http://www.nektar.com/application/files/1215/2798/5479/NKTR_…

Since this price drop is a big deal to many on this board, I will give my interpretative background: I am a practicing radiologist with a doctorate in cell and molecular biology (did a lot of bench top research), and I also manage clinical trials as part of a small, private, but up and coming imaging contract research organization. We do not have the contracts for NKTR’s clinical trials.

My conclusion is that the I/II trial results are not mixed, just completely misunderstood from a mechanism of action of NKTR-214.

This is an immune activating drug. It needs time to stimulate the immune system, have it recognize tumor as pathologic, then trigger cell death and slowly cause the tumor to fade. The criteria used to evaluate response are radiologic, based upon reduction of tumor size on CT scans. The trial uses the RECIST criteria in which the summed diameters of 5 target tumors must reduce in aggregate diameter by 30% to be considered a partial response. While a small linear reduction, that is a big volumetric reduction. It takes time for this to happen, especially for it to be accomplished by your own immune system, and these are very aggressive “death” cancers.

There are two facets to their trial. N1 and N2. N1 was designed to determine the recommended phase 2 dosing and determine side effects, while N2 is designed to add an appropriate number of patients in order to fill out a statistical model (Fleming Two Stage Design) that would predict with 90% probability that results are statistically significant over use of a single checkpoint inhibitor drug..

The time it takes for patients to develop an immune response which then results in tumor shrinkage is the crux of the analyst interpretive problem. NKTR-214 is not a chemotherapeutic agent which hits tumors hard initially, with lots of cell death, tumor necrosis, and later tumor recurrence. This biologic agent takes time to stimulate and refine the immune response to tumor, then it takes time for the immune system to kill the tumor and cause tumor shrinkage, then it takes time for the patient to get another CT scan (we don’t just do these willy-nilly), then it takes time for a radiologist with a contract research organization to score the scan, then it take time for the results to be compiled.

The N1 patients for renal cell carcinoma have been on study for on average 10.1 months with and overall response rate of 71%, improved from a 46% response rate in Nov 2017. The N1 melanoma patients also show deepening responses over time with an overall response rate now of 77%. This is what I was looking for in their presentation.

Based upon the Fleming Two Stage Clinical Trial design, N2 patients were added to the trial to in order to reach a statistical number of responders to reject the null hypothesis and show that NKTR-214 met its efficacy targets (which is not just a response, but a response better than historical treatments, i.e. single checkpoint inhibitor therapy). These N2 patients are the interpretative problem as their mean time on trial is 4-5 months and thus they are skewing the response data downward as they have just not been on trial long enough (they look like the N1 patients back in November). This is what the analysts are upset about.

What is interesting is that despite this, even with the added N2 patients to the N1 patients, and the resultant downward apparent overall response rate, the responses in N1+N2 are statistically significant over historical treatments. The phase I/II trials are essentially concluded for first line renal cell, first line melanoma, and cis-platinin ineligible bladder cancer. They have the data they need to advance to phase 3 clinical trial for each of the indications, and are enrolling those trials presently.

There is much more to add regarding non small cell lung cancer (NSCLC), and their efforts to expand into second and third line melanoma, RCC, bladder, NSCLC, and even triple negative breast cancer as well as with triple combo therapies.

My conclusion is that the thesis has not changed, but actually improved, and there is opportunity in short-sightedness, but that you also never know what will really happen when dealing with patients and biology.

This too shall pass…On vacation this week with family and headed for a morning hike in Glacier National Park.

Jack

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Wow Jack, what a great explanation! Thanks so much for taking the time to spell it out!
Saul

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