ARIAD Pharma (ARIA) Investor Event with Management: Steady Upside Likely to Continue - Jefferies

Jefferies analyst, Eun Yang, hosted an investor dinner with ARIAD Pharmaceuticals' (NASDAQ: ARIA) Paris Panayiotopoulos (CEO), Manmeet Soni (CFO) and Timothy Clackson, Ph.D. (President of R&D and CSO). The analyst believes the steady share price appreciation to date has been driven by positive changes under new leadership since early-2016. With updated Ph2 data for its 2nd drug brigatinib at ASCO (FDA approval in 1H17) and add'l strategic decisions at the Analyst & Investor Day on 6/17, we expect further upside likely. There could be two cancer drugs on market in 2017 (Iclusig, brigatinib) & their potential for expanded earlier tx settings should lead to renewed interest to drive shares.

At ASCO, updated Ph2 ALTA data for brigatinib (~3 add'l months data vs. Dec. 2015 cut-off date in abstract) could potentially provide improved ORR/PFS (vs. ORR/PFS of 46%-54%/8.8-11.1mo in abstract) and CNS data during oral presentation on 6/6/16. ARIA notes PFS is a key feature of brigatinib vs. other ALKi; KOLs see ~2-3mo add'l PFS benefit over current ALKi as clinically meaningful in 2L ALK+ NSCLC. Although not a head-to-head study comparison, given the very comparable pts population (crizotinib-experienced ALK+ NSCLC), ARIA notes ~2-3mo PFS benefit of brigatinib (11.1mo vs. 8.1-8.9mo for alectinib) as meaningful. In the CNS, ORR in earlier Ph1/2 was 53% in pts with measurable intracranial metastases (n=8/15; incl. 1 CR) vs. 35% in pts with nonmeasurable lesions (n=11/31; all CR) with median intracranial PFS of 15.6mo (n=48 pts with FU scan). In comparison, alectinib showed ORR of ~40%-43% (with CR of ~25-27%) in pts with measurable & non-measurable CNS metastases with DoR of 10.3-11.1mo. At ASCO, ARIA expects early CNS PFS data & ORR data from Ph2 ALTA trial.

No change to Buy rating or $13 PT.

For an analyst ratings summary and ratings history on ARIAD Pharmaceuticals click here. For more ratings news on ARIAD Pharmaceuticals click here.

Shares of ARIAD Pharmaceuticals closed at $8.08 yesterday.

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