Morning Commentary: Clovis Oncology dominates trading, convertibles jump over 25 points on data

By Stephanie N. Rotondo

Seattle, June 19 – A New York-based sellside source said that Clovis Oncology Inc. was the “nom du jour” on Monday, as the company’s stock (Nasdaq: CLVS) popped nearly 50% in early trading.

The company’s 2.5% convertible notes due 2021 also got a nice pop, the trader said, seeing the issue trade at 158.6 against a stock price of $84.60.

Another source also placed the debt with a 158 handle, which compared to levels with a 125 handle last week.

The momentum in the securities came as Clovis shared positive late-stage clinical trial data on its ovarian cancer treatment, Rubraca. The results will help the company market the drug for wider uses than the originally proposed treatment for cancer patients that test positive for defective BRCA genes.

In fact, the data indicated that the drug could be effective on up to four times as many patients as originally expected.

Additionally, Clovis also said on Monday that is had reached a settlement deal on a class action lawsuit related to an experimental lung cancer drug.

The lawsuit was brought by investors who said Clovis misled them on the drug’s potential.

Because of the settlement, Clovis will take a $142 million charge in the second quarter.

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