BST Trade Alert – April 9, 2015
Recommendation:
Buy Verastem $NASD: VSTM up to $12.00 per share.
About the Company:
Verastem is a clinical-stage biopharmaceutical company focused on discovering and developing drugs to treat cancer by the targeted killing of cancer stem cells.
Cancer stem cells are an underlying cause of tumor recurrence and metastasis. Verastem is developing small molecule inhibitors of signaling pathways that are critical to cancer stem cell survival and proliferation.
Their pipeline consists of 3 drugs in various stages of clinical trials.
Right now, they have about $93 million in cash. And they have enough cash to continue operations for at least two years without raising additional money.
About the Drug:
Their leading drug candidate is VS-6063.
This drug is currently being tested for the treatment of Mesothelioma lung and ovarian cancer.
So far the drug is showing promising results in the COMMAND study.
They are targeting cancer stem cells after chemotherapy in order to increase overall survival, quality of life, and progress free survival rates of patients with these types of cancer.
About the Market for This Drug:
Mesothelomia is a terrible form of cancer with very low survival rates and high levels of unmeet need. If the drug shows promise in progression free survival rates, the drug is likely to be fast tracked by the FDA.
This is a multi-billion dollar market. Other drugs that target this patient population have sales of more than $3.5 billion per year.
About the Potential Catalyst:
So far they have enrolled 180 of the 372 target patients for this study.
They will be able to report interim data based on the progression free survival rates once they have data on 50%. They expect to have this data sometime in the first half of 2015.
What’s more, the COMMAND study is being done across 13 countries at the same time. So, they could roll this drug out worldwide in a very short period of time.
About the Shares:
VSTM is currently trading for $10.28. The stock is up 12.6% this year. It’s currently 16.9% below the 52-week high.
The stock recently broke out above a price channel between $7.00 and $10.00. It shot up to a 52-week high of $12.35 before pulling back to support around $10.00.
This is bullish price action and should lead to higher prices in short order.
Key Facts:
Company: Verastem
Ticker: VSTM
Recent Price: $10.28
Market Cap: $369 million
Average Daily Volume: 658K shares
Chart:
Category: BST Trade Alert
