PBYI - Will Puma Biotechnology Break Out of Its Rut in 2020?
Aside from an acquisition, earning marketing approval for a drug candidate is the single biggest event that can happen for a development-stage pharmaceutical company. It marks the beginning of the transition to commercial operations and tends to spark a celebration among investors. But sometimes the celebration is premature.
Puma Biotechnology (NASDAQ: PBYI) offers a particularly painful case study of what can go wrong after a promising drug product launches. The company's breast cancer drug, Nerlynx, was once widely expected to become a blockbuster (a drug that generates over $1 billion in annual sales), but severe side effects have led to high discontinuation rates among patients. Growth virtually stalled in 2019. The pharma stock has fallen over 90% since its peak in late 2017.
While the precipitous fall in the stock price has been terrible for shareholders, Puma Biotechnology has a realistic plan to get Nerlynx back to growth. What do investors need to watch to gauge progress in 2020?