NewLink Genetics' Stock Plunges As Genentech Plans To Returns Rights Cancer Treatment Candidate

Shares of NewLink Genetics Corp. plunged 31% in premarket trade Thursday, putting them on track to open at a more-than 5-year low, after the biopharmaceutical company said Genentech planned to return the the rights to NewLink's IDO inhibitor GDC-0919 (navoximod), an immuno-oncology product candidate. The rights were part of a license agreement from October 2014. NewLink said the research collaboration with Genentech, a member of the Roche Group for the discovery of IDO/TDO inhibitors will continue. "We are obviously disappointed in this decision," said NewLink Chief Executive Charles Link. "We remain committed to advancing our IDO pathway inhibitor indoximod, which continues to generate exciting data in combination with anti-PD-1 agents, cancer vaccines, and chemotherapy in multiple cancer types including melanoma, prostate cancer, acute myeloid leukemia, and pancreatic cancer." NewLink shares had tumbled in April after disappointing results of a trial in which indoximod was being tested in combination with Merck & Co.'s Keytruda. The stock traded at $7.38 ahead of the open, the lowest price seen during regular trading hours since February 2012. The stock has plummeted 47% over the past three months, while the iShares Nasdaq Biotechnology ETF has slipped 1.6% and the S&P 500 has gained 8.7%.