Positive Clinical Data Propels Geron Corporation (NASDAQ:GERN)

Geron Corporation (NASDAQ:GERN)

Geron Corporation (NASDAQ:GERN) and Janssen Research and Development, LLC, have a collaboration agreement whereby Janssen evaluates the internal data produced by the clinical trial of Geron’s clinical trials labeled IMerge and IMbark. Geron’s drug candidate, Imetelstat, targets disorders, including cancer, that has its origins in the patient’s bone-marrow blood cells. Janssen’s analysis of the data that resulted from the IMerge and IMbark trials suggest that the risk/benefit profile supports further development and study. This news sent GERN shares over 20% higher ($2.60) on volumes (10.5 million) exceeding 20 times their daily average just two hours into trading.

Myelodysplastic syndromes (MDS) describes a group of cancers that result from immature blood cells, located in the bone marrow, never developing into healthy blood cells. Some types of MDS may develop into acute myeloid leukemia. Janssen concluded that data from the Imetelstat-treated patients in the IMerge trial justifies further development efforts for lower risk MDS. A data package and proposed trial design refinements will be provided to the FDA.

Myelofibrosis (MF) is a disorder of the bone marrow. This syndrome is characterized by bone marrow being replaced by scar tissue which inhibits the bone marrow to create blood cells which may result in Anemia, bleeding problems, and the possibility for a higher risk of infections. This condition results in the liver and spleen compensating by increasing their blood cell production which causes the organs to swell. Janssen concluded that data from the Imetelstat-treated patients in the IMBark Phase 2/3 trial for patients with MF demonstrates a safety profile consistent with previous trials and a starting dose rate of 9.4 mg/kg suggesting a clinical benefit.

Over the next year Janssen, per agreement with Geron Corporation (NASDAQ:GERN), will evaluate, in an ongoing manner, the efficacy and safety data from the trial which will include an assessment of overall patient survival. Geron Corporation (NASDAQ:GERN) expects the trial data, combined with any available feedback from the health authorities, and the imetelstat’s programatic totality, will lead Janssen to determine if Geron’s development of imetelstat shall continue or not.

Before today shares of Menlo Park, CA-based Geron Corporation (NASDAQ:GERN) had traded between $1.90 and $2.40 for most of the past six months. Three firms follow Geron. Two rate GERN shares as a “Strong Buy’ and one rates the shares as a “Hold”. Their consensus price target is $4.17. GERN shares have a high short float percentage. Over 20% of the stock’s float is represented by short-selling. In 2015 GERN shareholders broke even on sales of $36.4 million. However for 2016 GERN shareholders experienced an EPS loss of -$0.19 on $6.2 million in sales.

4/10/2017
Ticker Symbol GERN
Last Price a/o 11:41 AM EST  $                      2.61
Average Volume                1,470,000
Market Cap (mlns)  $                  342.17
Sales (mlns) $6.20
Shares Outstanding (mlns) 159.15
Share Float (mlns) 158.37
Shortable Yes
Optionable Yes
Inside Ownership 0.10%
Short Float 20.35%
Short Interest Ratio 21.9
Quarterly Return -6.93%
YTD Return 3.86%
Year Return -31.75%

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading.

Author: Steve Clark

Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

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