NBIX - Neurocrine Biosciences: Multiple 2023 Catalysts Makes It A Must-Watch

2023-04-24 19:30:47 ET

Summary

• Neurocrine Biosciences, Inc. results from both registrational studies, using Crinecerfont for the treatment of adults and pediatric patients with Congenital Adrenal Hyperplasia, are expected in the 2nd half of 2023.
• A PDUFA date of August 20, 2023, has been established for potential FDA approval of Valbenazine for the treatment of chorea in Huntington's disease.
• It is said that the global Huntington's disease treatment market size is expected to be worth around $1.7 billion by 2030.
• INGREZZA has been approved by the FDA to treat patients with tardive dyskinesia; full-year 2023 net product sales of INGREZZA is expected to be $1.67 billion as a low end estimate.

Neurocrine Biosciences, Inc. ( NBIX ) is a great speculative biotech play to look into. That's because it completed enrollment of registrational studies in both adult and pediatric patients for the treatment of congenital adrenal hyperplasia [CAH]. What's important about this development is that it expects to release results from both of these studies in the 2nd half of 2023. Positive results from these late-stage studies would add additional value for the company.

Not only does this opportunity exist for shareholders, but it is expected that data readouts will occur for two other programs in the Neurocrine Biosciences pipeline this year, which are for focal onset seizures in adults and Anhedonia in Major Depressive Disorder. Both of these indications are expected to have data releases in the 2nd half of 2023 as well.

Lastly, there is a catalyst relating to a PDUFA date established by the FDA of Valbenazine for the treatment of chorea in Huntington's disease on August 20, 2023. As an added bonus, Neurocrine Biosciences is already generating substantial revenue from sales of its drug INGREZZA, which has been approved to treat tardive dyskinesia.

With several data readouts approaching in the latter part of this year, plus potential of FDA approval of Valbenazine, these are the reasons why I believe Neurocrine Biosciences, Inc. is a good speculative biotech play to look into.

Multiple Data Readouts Could Mean A Huge Boost For Shareholder Value

A good thing about Neurocrine Biosciences is that it has several data readouts expected in the 2nd half of 2023. The two most important data readouts approaching would be the release of results from the two registrational studies using Crinecerfont for the treatment of adults and pediatric patients with Congenital Adrenal Hyperplasia [CAH], respectively.

Congenital adrenal hyperplasia is a group of genetic disorders that affect the adrenal glands, which are located above the kidneys. This genetic disorder occurs because there is a lack of an enzyme known as 21-hydroxylase. This is an important enzyme, because it is required in order for the patient's body to make the proper hormones. With a patient having this disorder, their adrenal glands are unable to produce important hormones to function properly. It can affect cortisol, mineralocorticoids and androgens.

The first phase 3 study recruited a total of 182 adults with CAH who were randomized to either take Crinecerfont or a placebo for a total of 24 weeks. The primary endpoint of this study is the percent change from baseline in glucocorticoid daily dose at week 24. Then, you have another closely similar registration study using this drug for pediatric patients. That is, a phase 3 study randomizing pediatric patients to either receive Crinecerfont or placebo for a total of 28 weeks. However, this study is only expecting recruitment of 104 patients and a different primary endpoint which is being evaluated over a 4-week period. That is, a change from baseline in serum androstenedione at Week 4 (Baseline to Week 4).

It is expected that results from both of these registrational studies will be released in the 2nd half of 2023. Additional data readouts from two phase 2 studies are also expected during the 2nd half of 2023. One data release will be results from a phase 2 study using NBI-921352 for the treatment of focal onset seizure in adults. Then, another phase 2 study using NBI-1065846 for the treatment of patients with Anhedonia in Major Depressive Disorder.

FDA Approval On Deck Could Be Another Value-Adding Event

Another potential value-adding event expected this year in 2023 for this company could be the possibility of marketing approval of Valbenazine, which is being reviewed by the FDA for the treatment of chorea in Huntington's disease. Huntington's disease is an inherited disorder that causes nerve cell in parts of the brain to gradually break down. The problem is that the breakdown of such nerve cells causes the parts of the brain that control voluntary movement to not function properly. Thus, the patient experiences a lack of control over their movements. Notice above, that the intention of Neurocrine Biosciences is to target chorea in Huntington's disease. Chorea means uncontrollable movements and abnormal posturing that takes place. Other issues with chorea could be as follows:

• Behavior
• Emotion
• Personality changes
• Thinking pattern change.

This is a large market opportunity for this company for sure. It is said that the global Huntington's disease treatment market size is expected to be worth around $1.7 billion by 2030 . The potential with this program is the ability to possibly obtain FDA approval of Valbenazine for the treatment of chorea in Huntington's disease. That's because a PDUFA date has been established by the FDA of August 20, 2023 for this drug. This means that Neurocrine Biosciences, Inc. could possibly receive FDA approval of this drug for the treatment of this patient population on or before this date.

Financials

According to the 10-K SEC Filing , Neurocrine Biosciences had cash, cash equivalents and marketable securities of about $1.3 billion as of December 31, 2022. What's great about this biotech is that it is already generating a substantial amount of revenue.

For instance, in Q4 of 2022 (latest earnings report), net product sales of INGREZZA were $399 million. As far as fiscal 2022, net product sales reached $1.43 billion. Why do I believe that this company can do better with the upcoming earnings reports? It is because of the strong guidance it has given. It expects 2023 net product sales of INGREZZA to be $1.67 billion on the low end, with the upper estimate range being $1.77 billion.

Despite Neurocrine Biosciences, Inc. producing sales with INGREZZA, that doesn't remove the necessity of it needing to raise additional cash to keep its operations funded. The company states in its 10-K SEC filing that it believes it has enough cash to fund itself for at least the next 12 months. This means that at some point during at least the 2nd half of 2023, Neurocrine Biosciences will likely have to raise additional cash. I believe that such a cash raise could be tied to one of the catalysts I went over above.

Conclusion

The final conclusion is that Neurocrine Biosciences, Inc. stock is a great speculative biotech play to look into. That's because, as I described above, it has several data readouts which are expected in the 2nd half of 2023. These will both include data readouts of the registrational studies using Crinecerfont for the treatment of adults and pediatric patients with congenital adrenal hyperplasia [CAH].

Not only that, but Neurocrine Biosciences also has a PDUFA date of August 20, 2023, on deck, whereby the FDA is reviewing Valbenazine for potential approval for the treatment of chorea in Huntington's disease. It is said that the global Huntington's disease treatment market size is expected to be worth around $1.7 billion by 2030. In addition, it has already received FDA approval of a drug known as INGREZZA, which has been approved to treat patients with tardive dyskinesia. Not only has it already received U.S marketing approval for it, but was able to generate $1.43 billion in sales in 2022.

In addition, Neurocrine Biosciences, Inc. is guiding higher sales for total year 2023, expecting to bring in net product sales of INGREZZA totaling $1.67 billion as a low-end estimate. With several catalysts expected in 2023, plus potential FDA approval of Valbenazine for the treatment of chorea in Huntington's disease, these are the reasons why I believe that Neurocrine Biosciences, Inc. is a good speculative biotech play to look into.

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