Is Dynavax Technologies Corporation (NASDAQ:DVAX) a good stock to buy? Investors who are in the know are altogether becoming less confident. The number of bullish hedge fund positions that are disclosed in regulatory 13F filings were cut by 1 recently. There were 23 hedge funds in our database with DVAX holdings at the end of the previous quarter. At the end of this article we will also compare DVAX to other stocks including BioTime, Inc. (NYSEAMEX:BTX), Teligent Inc (NASDAQ:TLGT), and Gold Resource Corporation (NYSEAMEX:GORO) to get a better sense of its popularity though.
Follow Dynavax Technologies Corp (NASDAQ:DVAX)
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We follow over 700 hedge funds and other institutional investors and by analyzing their quarterly 13F filings, we identify stocks that they are collectively bullish on and develop investment strategies based on this data. One strategy that outperformed the market over the last year involves selecting the 100 best-performing funds and identifying the 30 mid-cap stocks that they are collectively most bullish on. Over the past year, this strategy generated returns of 18%, topping the 8% gain registered by S&P 500 ETFs. We launched this strategy 2.5 years ago and it returned more than 39% since then, vs. 22% gain registered by the S&P 500 ETFs.
Dynavax (DVAX)’s lead product candidate is HEPLISAV-B, an investigational vaccine for adult hepatitis B. Hepatitis B is a serious condition that can lead to cirrhosis, hepatocellular carcinoma, and chronic hepatic insufficiency. Around 350 million people globally are chronically infected with Hepatitis B and are carriers of the virus.
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Currently, there are two vaccines for Hepatitis B on the market, Engerix-B by GlaxoSmithKline, and Recombivax HB from Merck. Both vaccines require three shots, the first two shots one month apart, and the third shot six months after the first. Because of the long waiting period for the third shot, many patients don’t take it and don’t receive the full protection of the vaccine. If approved, Dynavax’s HEPLISAV-B would be superior than the two vaccines on the market because it requires only two shots one month apart before becoming fully effective. On June 11, DVAX presented efficacy data from a Phase 3 trial demonstrating that HEPLISAV-B provided a higher rate of seroprotection than Engerix-B in adults with type 2 diabetes. Because of the greater seroprotection and shorter times, analyst believe HEPLISAV-B will garner a substantial percentage of the estimated $1 billion-a-year market.
Dynavax previously applied for a Biologics License Application (BLA) for HEPLISAV-B in 2012, but didn’t get approval because the FDA wanted more safety data. In 2014, Dynavax began new safety studies to produce the additional data the FDA requested and on January 7 2016, Dynavax released positive results from a Phase 3 study that showed that HEPLISAV-B had met the primary endpoint with respect to the overall safety of the drug. In late March 2016, the FDA accepted for review the BLA for HEPLISAV-B.
On April 27 2016, DVAX fell substantially after the FDA said it needed more time to review the BLA for HEPLISAV-B. The FDA determined that the integrated data Dynavax submitted represented a major amendment to the BLA, and the agency postponed the PDUFA date for HEPLISAV-B by three months to December 15, 2016. The FDA also set the Advisory Committee meeting to occur on November 16.
