SRRA Shares Higher: Sierra Oncology Cancer Drug Shines in Testing

By Duncan Ferris

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Sierra Oncology (NASDAQ: SRRA) shares leapt by more than 25% on Wednesday after a breakthrough in the firm's quest to commercialize a blood cancer treatment.

Sierra Oncology (NASDAQ: SRRA) has seen its share price storm higher after the biopharma company achieved strong results in its latest Momelotinib study. The treatment has been developed to help combat myelofibrosis, a nasty and incurable blood cancer.

In Sierra’s recent study, significantly more patients treated with Momelotinib saw a reduction in symptoms of more than 50% compared with the control group, who were treated with currently used drugs.

As such, the company now plans to push ahead with a New Drug Application in the second quarter of 2022. The US Food and Drug Administration has already granted the treatment with Fast Track designation, meaning its verification could come very rapidly.

Sierra Oncology’s president and CEO, Stephen Dilly, commented:

“These data are extremely exciting and everything we had hoped to see from the trial.

“To achieve statistically significant and clinically important efficacy across all prespecified primary and key secondary endpoints while maintaining platelet counts in such a difficult to treat patient population is remarkable, and a confirmation of the anemia response we identified in the comprehensive review of our previous Phase 3 studies.”

Sierra’s capital

Alongside confirmation of the strong results, Sierra was eager to show it has the resources to successfully commercialize the treatment. The company said it had estimated cash and cash equivalents of $104.7m at the end of 2021 and confirmed it has the ability to access up to an additional $120m in a series of tranches from a loan facility.

Series B Warrants could provide a total of $33.3m in proceeds if fully exercised before their expiration in 74 days’ time.

Furthermore, the company announced plans to sell $100m worth of shares of its common stock in an underwritten public offering. Proceeds of this would also go towards commercialization efforts and development of the company’s other candidates.

Should you invest in Sierra Oncology?

As such, it’s not hard to see why investors are so excited about Sierra. SRRA appears to have developed a useful treatment and has the capital to give its creation some serious backing.

However, biotech stocks have performed poorly over the last 12 months. The SPDR S&P Biotech ETF, which tracks the performance of biotech stocks, has dropped by over 40% in the last year.

Even so, you might think biotech stocks are ready to fight back or consider Sierra a strong enough prospect to buck the trend.

If you enjoyed reading this analysis piece, why not read our in-depth reports on ESG investing and Healthcare investing. Or check out our 12 investing themes for 2022.

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Topics:
Healthcare Supplies
Biotechnology
Pharmaceuticals
Industries:
Healthcare
Companies:
Sierra Oncology

Author: Duncan Ferris

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Duncan Ferris does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above article.

Duncan Ferris has not been paid to produce this piece by the company or companies mentioned above.

Digitonic Ltd, the owner of ValueTheMarkets.com, does not hold a position or positions in the stock(s) and/or financial instrument(s) mentioned in the above article.

Digitonic Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.

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