Stand: 31.10.2022
In October, inflationary pressure and tough central bank rhetoric have been important topics, but increasing signs of economic stress, dire profit and especially guidance warnings by many companies brought forth the notion of the Fed pivot. Current interest rate levels start to bring down economic activity and will help to calm inflation, even though exact timing and levels of normalization are still a topic of discussion. The very idea that most of the heavy lifting is probably done in terms of interest rates was enough to lift global equity markets out of their depressed mood and lead to a rally during October. The global healthcare sector could keep pace with those positive trends. It might sound counterintuitive, but the “defensive major pharmaceutical and biotechnology companies were among the star performers. Medical technology was mixed, and performance depended heavily on the quarterly results. An overriding theme in medical technology, however, was ongoing staff shortages, which sometimes led to lower procedure volumes as expected by both the companies and investors. Generally small cap biotechnology stocks were also lagging, although some clinical data led to wide performance divergences. Finally, life sciences and research equipment companies, normally a beacon of stability in tough times, performed rather poorly over the month as investors continue to fret over declining covid-related revenues and risk of decelerating core revenue growth. In October, AACR-NCI-EORTC, or the “Triple Meeting Molecular Targets and Cancer Therapeutics Symposium, took place with several new data disclosures in the field of oncology. MorphoSys has shown preliminary results from the ongoing phase 1/2 study of their next generation EZH2/EZH1 inhibitor in heavily pre-treated patients with advanced cancers. The efficacy looks encouraging in several cancer types, supporting possibilities of development for broad array of solid tumours, however it comes at the cost of safety. Merus presented the first data of EGFR x c-MET bispecific antibody. The drug candidate has shown solid initial efficacy and competitive safety profile in patients with lung cancer and other solid tumours. While the clear differentiation remains to be demonstrated, Merus antibody has a chance to become a competitive player, based on preclinical data showing great potency and convenient dosing regimen. Outside of the conference, BeiGene has announced that their BTK inhibitor Brukinsa achieved superior progression-free survival compared to Johnson & Johnson and AbbVie s competing drug Imbruvica in a head-to-head phase 3 clinical trial in patients with subtypes of leukaemia and lymphoma. This information came on top of showing better overall response rate as demonstrated earlier this year and supports the application seeking expanded approval of Brukinsa, which is currently under review by the FDA. AstraZeneca s high-level results from phase 2 trial in patients with estrogen receptorpositive breast cancer has revived the field of oral selective estrogen receptor degraders (SERDs). Astra s drug candidate has shown statistically significant and clinically meaningful benefits of progression-free survival as compared to standard of care (fulvestrant). Also, Astra s Akt inhibitor capivasertib has shown good efficacy in the same breast cancer setting. Both results give Astra the competitive advantage over Roche. Merck has opted in to jointly develop Moderna s personalized cancer vaccine for melanoma. The therapeutic vaccine based on messenger RNA technology is being studied in combination with Mercks Keytruda in a phase 2 clinical trial and the companies expect to report data in the fourth quarter of this year.The third quarter earnings season has started, with consistently good results in the healthcare sector. The well-known lack of reliance on economic conditions led to few surprises, especially for pharma and major biotechnology companies.