Biotech Stock Mailbag: Xoma's Big Backers, FDA Approvals Contest - $XOMA

XOMA Corporation (NASDAQ: XOMA) is a biotechnology company focused on the discover and development of monoclonal antibody-based therapeutics.  

 

XOMA’s world-class monoclonal antibody technologies have contributed to the development of marketed biologics with a total of more than $1 billion in annual sales and for which XOMA received substantial royalties. The company also has a strong track record of product discovery and development collaborations with pharmaceutical and biotechnology companies and the U.S. government, and has licensed certain of its fundamental technologies to numerous pharma and biotech companies. 

 

At TheStreet.com, senior columnist Adam Feuerstein wrote an article in answer to a reader's question: "Why is Xoma up 50% for the month?" 

 

Feuerstein explained that the stock rose because "Baker Bros., a well-respected and closely followed health-care hedge fund, bought half the Xoma deal" of $40 million financing that was announced on March 6. 

 

He continued,

"The question you're probably asking now is, "Wait a second -- Xoma? What the hell can Baker Bros. see in Xoma?" [I wondered the same thing.] Xoma is apparently getting a new lease on life, thanks to a top-to-bottom restructuring -- a new CEO and chief medical officer, cost cutting and a new business model. Xoma is still developing the same lead drug XOMA 052 (given a new name, gevokizumab) but money-wasting efforts in diabetes and cardiovascular indications have been shelved in favor of clinical trials for Behcets uveitis and non-infectious uveitis -- both diseases of the eye.

 

A phase III study of gevokizumab is expected to start this summer with data likely available by the end of 2013."

 

Daily Dose: We spoke with an analyst who covered Xoma for years. The analysts shared with us, that the indication "Behcets uveitus" has promising data.  Xoma has managed to stay alive since the dawn of biotech and sooner or later, this stock should work.

Read the full article at TheStreet.com.