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How Good Were Celldex Therapeutics' Latest Clinical Results?

Celldex Therapeutics (NASDAQ: CLDX) recently announced results from a phase 1b clinical study evaluating CDX-0159 in treating two of the most common forms of chronic inducible hives. In this Motley Fool Live video recorded on July 14, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss just how good the biotech's latest clinical results were.

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Keith Speights: Let's talk about a small biotech that really hasn't been in the news much until just recently. Celldex Therapeutics has had pretty much nothing but bad news over the last few years. But this week, this beleaguered biotech had some really good news: Celldex reported results from an early-stage study for its experimental antibody therapy CDX-0159. Brian, what do you make of those results?

Brian Orelli: Yes, this is a phase 1 study in patients with the two most common forms of chronic inducible hives. The data was quite impressive.

Of the 19 treated patients, 18 had a complete response and the other patient had a partial response. Three of those patients had previously been treated with Oxsoralen -- that's drug for hives and other diseases from Roche and Novartis -- and all three of those patients that had previously been treated with the other drug had a complete response.

The company plans to start a phase 2 study in the first half of 2022. It's also planning to study the drug in a clinical trial for prurigo nodularis, that's another rash disease, in the fourth quarter; and then it's looking to expand into other indications as well. This drug can have multiple potential indications that can drive the potential market size for the drug.

Speights: Brian, my guess is that Celldex isn't a stock that's on your radar to buy anytime soon. But let's say there's some investors out there who are seriously considering investing in Celldex; what words of wisdom would you impart to them before they make that decision?

Orelli: Yeah, the pipeline in the drug can be a huge advantage, but it can also be a disadvantage too -- because if it fails in any one of these indications, it will drive down the stock a lot more, because the investors will then be worried that it will fail in the other indications.

I think that's the biggest issue with having one drug that can treat multiple diseases, is that it has a huge advantage because you can get a lot of sales from one drug; you can get multiple diseases, and therefore a larger market size. But also the downside is that if there's a problem with the drug working in one disease, investors are going to assume that that means it might not work in other diseases, and the price will adjust accordingly.

Brian Orelli, PhD has no position in any of the stocks mentioned. Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.


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