Tough day.
The dumping of bio-pharma player Nektar Therapeutics’ (NKTR – Get Report) stock on Monday, which crashed nearly 42%, might have been done so too hastily according to analysts TheStreet talked with.
Shares plummeted after investors and Wall Street analysts found Nektar’s mid-stage trial results for its collaborative effort with Bristol-Myers Squibb Co. (BMY – Get Report) to combine Nektar’s NKTR-214 top immune-oncology program with Bristol-Myers’ Opdivo drug to be below expectations.
Response rates for patients with melanoma and kidney cancer patients decreased, according to the study that was released to the American Society of Clinical Oncology (ASCO) over the weekend.
“You have to think of it as a snapshot, it’s a moment in time,” Nektar Chief Scientific Officer Johnathan Zalevsky reportedly said in an interview at an ASCO conference meeting in Chicago. “We have high confidence based on our data that, over time, these response rates are going to improve.”
Pharmaceutical companies often see stock price drops when they report poor trial performances, but not as drastically as Nektar’s, Edward Snyder, certified financial planner for Oaktree Advisors, said. It’s the largest single-day drop he’s seen from a pharmaceutical company that he can remember, he said.
“This is probably an overreaction by investors trying to trade it on the short term,” Snyder said. “As far as expectations, it’s anyone’s guess. It could go either way. You could see it bounce back and regain some of that which it lost, or it may just stabilize out and continue up from here.”
Read more at The Street