Biotech Calendar: Key Dates and EventsA quick and dirty guide to important biotech events for October.
By Adam Feuerstein, TheStreet.com Senior Columnist
THESTREET.COM — 09/30/09
BOSTON (TheStreet) -- A calendar of important, potentially stock-moving biotech events for October:
Oct. 5-6
JMP Securities Healthcare Focus conference
Oct. 7-8
Cowen & Co. 12 th Annual Therapeutics Conference
Oct. 8
FDA approval decision date for Spectrum Pharmaceuticals' (Symbol: SPPI) colon cancer drug Fusilev.
9/30/09
Preventing HIV with Gilead Science's Truvada
TenofovirPresident and COO of Gilead Sciences Inc. (GILD) John F Milligan.
“The fixed dose Quad pill is the most exciting thing we’re working on,” Milligan said.
Sanofi-Pasteur and VaxGen's HIV Vaccine Discovery
News from the new Aids Vaccine. The study involved 16000 volunteers from Thailand shows promise with a 30% effective rate in preventing HIV. Sanofi-Aventis (SNY) and VaxGen (VXGN) were the stocks involved. Sanofi is approaching a 1 year high trading at 36.76 while VaxGen is experiencing a strong sell-off closing at 0.68 after reaching a high of 0.999 in OTC trading.
In 1995, Drs. Francis and Nowinski, a Seattle-based retrovirologist and entrepreneur, led the spin-off of the Genentech HIV vaccine effort, forming VaxGen to concentrate on further development of AIDSVAX.
The VaxGen team then developed the bivalent form of AIDSVAX to increase the vaccine's potential to protect against additional strains of HIV. Genentech, VaxGen's manufacturing and development partner for the vaccine, has manufactured large quantities of the bivalent AIDSVAX for the upcoming Phase III clinical trials.
"We are proud of the role Genentech played in the development of this vaccine. We congratulate VaxGen's team and support them as they continue this vital work," said William D. Young, Chief Operating Officer of Genentech and a member of VaxGen's board of directors.
VaxGen, based in South San Francisco, Calif., is a biotechnology company committed to making an HIV vaccine for worldwide use. Genentech, one of the world's leading pharmaceutical biotechnology companies, is also based in South San Francisco and is VaxGen's largest shareholder
This vaccine needs more devolopment, mostly with efficacy, but there are other stocks in search for a HIV vaccine.
Other companies searching for the HIV vaccine:
PRO542 Progenics Pharmaceuticals (PGNX) HIV
PRO 140 Progenics Pharmaceuticals (PGNX) HIV
HVTN 502 Merck (MRK)
HVTN 503 Merck (MRK)
Top Newswire Coverage from the HIV Vaccine Clinical Discovery.
That's a step in the right direction, but those are modest results; for any other disease, preventing infection in fewer than a third of the tested cases wouldn't arouse much hype or hope. But with the HIV virus, after 25 years of attempts and failures, some fairly recent, it's no wonder everybody is excited for this potential breakthrough.
The experimental vaccine is a combination of ALVAC, from Sanofi Pasteur, the vaccine division of Sanofi-Aventis (SNY), and AIDSVAX, originally developed by VaxGen (VXGN) and now held by the nonprofit Global Solutions for Infectious Diseases. Neither vaccine worked individually in previous trials, but the combination, called RV144, showed modest results. (Neither vaccine causes HIV, separately or together.) The trial was a collaborative effort among the U.S. Army, the Thai Ministry of Public Health, the National Institute of Allergy and Infectious Diseases, the National Institutes of Health, Sanofi Pasteur, and GSID.
16,402 volunteers in Thailand participated in the trial, which opened in 2003. Half received the vaccine, and half placebos; all were counseled on HIV prevention. Of the 8,198 people injected with the placebo, 74 contracted HIV; of the 8,197 who got the vaccine, 51 got the virus -- a difference the collaborative effort calls statistically significant. More details will be given at the AIDS Vaccine Conference in Paris in October.
Researchers seemed surprised. "These results show that development of a safe and effective preventive HIV vaccine is possible," said Col. Nelson Michael, director of the U.S. Military HIV Research Program, in a statement. "While these results are very encouraging, we recognize that further study is required to build upon these findings."
The U.S. HIV/AIDS epidemic began in 1981, according to the NIAID; 565,927 people in the U.S. have died of AIDS. Globally, 33 million have lived with HIV/AIDS, and 2 million died of related illnesses in 2007.
But many challenges lie ahead. Different strains of HIV exist throughout the world; those common in Thailand unusual in the U.S., Africa, and elsewhere. Scientists will need to determine how long the protection lasts, whether booster shots will be needed, and so on. And some in the scientific community are skeptical; Jon Cohen at Science Insider explains that many AIDS vaccine researchers had predicted that the study would fail. They are now "dumbfounded -- and circumspect": concerned that the results came by chance.
This is the third big vaccine trial since 1983, when HIV was identified as the cause of AIDS, the AP reports. As recently as 2007, Merck & Co. (MRK) halted a study of its experimental vaccine after seeing that it actually increased the risk of infection. Before that, in 2003, AIDSVAX also failed in trials.
Vaccine makers might try to license the two-vaccine combo in Thailand. The U.S. Food and Drug Administration will need more studies before the vaccine can be considered for U.S. licensing, and its effectiveness will most likely need to be higher before it gets approval.
While Sanofi shares are down today, VXGN's are up over 10 percent.
Sequenom's Stock Falls, Clouded With Uncertainty
Sequenom Inc (SQNM) has been a disaster of a trade today. Down huge. Today alone lost 39%, trading down to 3.46. A year ago Sequenom was trading at 21.41. They were recovering slightly from their FDA false data reports for their clinical studies on pre-natal testing for Down's Syndrome, or Trisomy 21.
Sequenom Inc (SQNM.O) shares plunged Tuesday, a day after the company removed almost its entire top management following an independent probe that found the company failed to prevent mishandling of data related to its prenatal Down Syndrome test.
YouTube Credit Card Rant Gets Results
I mostly write about BioPharma Stocks but this does deal with a prominent stock Bank of America (BAC), who's stock price has risen considerably from the bailout period a year ago. The Debtor's Rant/Revolt Youtube video sets up some interesting points that could possibly hurt a stock or our country, which could happen. Theoretically this could cause an uproar and maybe another state of depression that we are currently experiencing. But could it possibly happen?
Would enough people risk hurting their credit? What could happen to our country if there was another tax revolt? This country was founded on a tax revolt so it's not exactly hard to imagine if people would form a revolution against Big Business and Wall Street. I still make trades but I am somewhat cautious on my trades as anything and everything can happen.
9/27/09
Abbott to Buy Solvay Drug Unit for $7 Billion NYSE: ABT
This just in from the WSJ. Abbott Labs (ABT) acquires Solvay conglomerate for 7B, or 4.8B eu.
Abbott to Buy Solvay Drug Unit for $7 Billion
Abbott Laboratories has struck a deal to acquire the pharmaceutical unit of Belgian conglomerate Solvay SA for roughly €4.8 billion ($7 billion), in another sign of the consolidation of the drug industry.
Swine Flu Remains Mild as Vaccine Advances
Senators Reject Bid to Cut Drug Prices for Low-Income Seniors
I am just reporting this for Big Pharma. I'm not glad that it affects those whocan't afford healthcare but at the same time what does Medicare cover these days when seniors can't afford their meds. It's a mess but expect the BioPharma Indexes rising this week.
Senators Reject Bid to Cut Drug Prices for Low-Income Seniors
WASHINGTON – An amendment to health-care legislation that would have cut drug prices for low-income seniors, imposing billions of dollars in new costs on the pharmaceutical industry, failed in a vote by the Senate Finance Committee on Thursday.
The measure would have allowed Medicare to purchase drugs for low-income seniors at the same price that Medicaid pays for the drugs, which the nonpartisan Congressional Budget Office estimated would have resulted in a loss of $106 billion over 10 years to drug makers.
9/25/09
Swine Flu Stocks Tumble
This past week we have seen Biotech Indexes falling sharply. In addition there has been a massive Swine Flu Stock sell-off. Stocks of note are Novavax (NVAX), Sinovac (SVA), Biocryst (BCRX), AVI Biopharma (AVII), and Dynavax Technolog (DVAX).
NVAX: 090109 6.65 high, Today at 3.81-- 43% loss
SVA: 090109 10.46 high, Today at 7.90-- 25% loss
BCRX:091509 11.67 high, Today at 8.26-- 29% loss
AVII: 090109 2.08 high, Today at 1.58-- 24% loss
DVAX: 091009 2.55 high, Today at 1.80-- 29% loss
Today's selloff is a sign that these stocks are solely trading on hype and volatility, this hype could come back but these are volatile stocks that will rise and fall sharply. Yesterday's crash appears to have come from Congress' Health Care 80B Dollar Bill vote. In news today, the Senate Votes Down New Pharma Cuts. We have the G20 convention in Pittsburgh this week. But there is a lot affecting the market the past couple of days. The Federal Reserve has people talking too. Today, the Fed moves to be sooner, faster, stronger: Warsh, meaning faster rate hikes in this case.
The market recovers slightly only to be set back down quickly to previous gains. It a state of reflux that is unpredictable. I see the swine flu stocks coming back but I do not think they will return to previous highs any time soon. Maybe at the height of flu season but with an early flu season we could all have some immunity to it by the end of the season. It's not that bad but it is a very contagious flu strain affecting young people at alarming rates. I do see these stocks rising again but there is no way to tell.
9/23/09
Trascept and Jazz Have Risen After Newsmakers in Biotech Industry Conference
Two stocks of note in the past week are Jazz Pharmaceuticals (JAZZ) and Transcept Pharmaceuticals .(TSPT). Last week Transcept attended the BioCentury Thomson Reuters Newsmakers in the Biotechnology Industry Conference on Sept 16, 2009. Jazz was also in attendance. It seems this conference is playing out as stocks have risen in the last week.
Transcept's stock has risen from a low of 11.00 before the conference to its current trading at 13.75. This is a fast rising company in its first year on Nasdaq. Jazz has jumped from a low of 9.16 to its current trading value of 9.72. Jazz has been up from earlier news that the CEO purchased 150,000 shares on Sept. 1-2, 2009 at 7.21 a share. Jazz Pharmaceuticals (JAZZ) Running On Buy From Smart Investor.
9/22/09
Cytokinetics Shows Favorable Phase II results
Cytokinetics (CYTK) is a clinical trial drugmaker that has been making some ground-breaking news this past week. They have numerous clinical trials taking place right now ranging from oncology (breast cancer and non-Hodgkin's lymphoma) to high risk heart failure. Their stock has risen in the past week from 3.50 to a high of 5.00 Monday afternoon 092209. Today the stock is trading at 4.67. Currently, they are recruiting patients for 3 Clinical Trials for their pipeline medications. Here is their ClinicalTrials.gov link: Cytokinetics Trials
Cytokinetics recently announced favorable Phase II data from last week for its Heart Failure medication. Here is the presss release from their website.
Cytokinetics Presents Phase IIa Clinical Trials Data on Omecamtiv Mecarbil at the 2009 Heart Failure Society of America Annual Meeting
9/15/09
Salix Pharmaceutical Shares Soar 50%
Bill Forbes, Salix’ senior vice president and chief development officer, said in a statement that if approved, rifaximin would be the first new option on the market for managing HE in more than 30 years. Salix estimates that HE represents a $600 million market in the United States.
Rifaximin also has been granted an orphan drug designation by the FDA for treatment of HE. That designation provides seven years of marketing exclusivity in the United States if the drug gains FDA approval.
Salix Pharmaceuticals, Ltd. (NASDAQ: SLXP) announced on August 25, 2009, the FDA has accepted for filing and designated for Priority Review the Company's New Drug Application for rifaximin tablets 550 mg for the maintenance of remission of hepatic encephalopathy. Additionally, the FDA has informed the Company of its plan to schedule an Advisory Committee meeting in late February 2010 to discuss the application.
A Priority Review classification is granted to drugs offering major advances in treatment, or providing a treatment where no adequate therapy exists. Based on this classification, the FDA has issued an action date of December 24, 2009 under the Prescription Drug User Fee Act. However, the convening of an Advisory Committee in late February 2010 signals the December 24, 2009 action date will be delayed.
"We are extremely pleased with the outcome of our pivotal Phase 3 trials of rifaximin in the treatment of non-constipation irritable bowel syndrome," stated Bill Forbes, Pharm.D., Senior Vice President and Chief Development Officer, Salix Pharmaceuticals. "Irritable bowel syndrome, characterized by abdominal pain, bloating and altered bowel habits, is one of the most common chronic medical conditions. Non-constipation IBS comprises the most common forms of IBS by including patients that have either diarrhea-predominant or diarrhea-constipation alternating symptoms. Based on the most current understanding of IBS, TARGET 1 and TARGET 2 were designed to investigate the utility of rifaximin, a broad spectrum, minimally absorbed, gut-selective antibiotic, with minimal side effects, in relieving the symptoms of IBS by altering the bacteria believed to be responsible for creating the symptoms. TARGET 1 and TARGET 2 will serve as the confirmatory trials for the Company's New Drug Application seeking marketing approval for rifaximin as a treatment option in this condition which is associated with widespread prevalence, incapacitating symptoms and substantial medical costs. The Company is targeting to submit the NDA during the first half of 2010."
Looking over Salix's Financials can be found here: SALIX PHARMACEUTICALS LTD Form 10-Q August 10, 2009
Total Assets were 377M. Total Liabilities were 137M. Total Liabilities and stock holder's equities were 377M with 63M in long term debt. For 6 months Revenue was 97M with a net loss of 29M. Net income from 2008 annual data was a loss of 47M on 178M in total evenue. Looking ahead to the third quarter of 2009, Salix expects to recognize a loss of approximately $0.30 per share and product revenue of about $60 million. Wall Street analysts expect the company to lose $0.28 per share on revenue of $60.43 million.
So financially they have been struggling a bit but most clinical trials are very expensive. With this approval and the NDA filing in Feb 2010 maybe they can turn the corner and make a substantial profit. I see the stock dropping a bit from the current volatility and hype but it should prove to be a profitable trade in the future. Most of their clinical trials are out of the way and they are an aggressive company acquiring the rights for future Gastrointestinal products.
Related articles
9/14/09
Talecris' IPO May Not Be A Profitable Trade
Talecris is expected to launch a billion dollar IPO in the next few weeks between the 18-20 point range. Once public, Talecris plans to trade on Nasdaq under the symbol TLCR. My take on the IPO is a pass. I feel that between 18-20, it will not be a hugely profitable trade at that range. I see a drop during its IPO is certainly plausible. Although the company is profitable they have huge debt and growth is expected between 6-10% through 2010.
BioPharma IPO's the past few years have not done all that well. Cumberland Pharmaceuticals IPO(CPIX) went sour with an initial offering between 19-21 that is now trading at 15.33. CPIX priced an initial public offering of 5 million shares at $17 per share, $2 below its estimated price range. The last biopharma IPO was ARYx Therapeutics went public in November of 2007. They traded at 7.85 back in November 2007 and are now trading at 3.31. However, these were not IPO's of the near billion dollar calaber that this IPO will be. Many companies have withdrawn their IPO plans according to Biotech IPO News
From the recent article on BNET Talecris May Not Be the First Biotech out the IPO Window. Talecris Biotherapeutics first filed for an initial public offering of stock in June 2007, but scrapped the proposed IPO during the summer of 2008 when an Australian company, agreed to buy it for $3.1 billion. That acquisition was ousted by the Federal Trade Commission resulting in a lawsuit for antitrust infringement. Talecris made headlines almost exactly two years ago in filing to raise as much as $1 billion in an 2007 IPO. The company is not exactly a traditional biotech – as a spin-out of Bayer, it markets plasma-derived products such as immune globulin and posted revenue of $1.4 billion [in 2008]. But Talecris’ returns aren’t exactly of biotech caliber either – net income on all those sales was just $65.8 million.
VetureBeat criticized Talecris’s original filing for being “ridiculously huge” and for other reasons:
"So what we have is a profitable but relatively slow-growing biotech with huge debts, run by executives who are themselves bleeding substantial amounts of cash out of the business, which is likely to remain heavily indebted after its owners siphon off most of the proceeds from an offering roughly four times the size of any other biotech IPO in almost a decade."
Here are three links to the Talecris IPO
A nice article on the IPO from 2007:
Talecris, a Ludicrously Large IPO, and the Beginning of the End for Private Equity?
Raleigh's News and Observer wrote a recent article on the IPO:
Talecris readies IPO that could raise $894 million
The Wall Street Journal's article:
Talecris Sets IPO At 44.7M Shares, $18-$20/Share
After looking at the SEC filings it shows Talecris reported revenue of $747.4 million during the first six months of 2009. That's up 20 percent from the same period last year. Profit rose to $116.7 million, up from 19 million in 2008. The latest profit included a $75 million termination fee from CSL Ltd. of Australia, after the companies' union was canceled. So profits could grow higher.
Here are SEC filings on Talecris at Hoovers
Net income from 2006 was 87.4M
Net income from 2007 was 123.6M
Net income from 2008 was 67.8M
Total Assets from June 2009 were 1.336B. Total Liabilities were 1,374B with 1.1B in long term debt. The long term debt with Talecris' IPO makes me worry and I recommend caution on the trade. You might even consider shorting the IPO, but I really don't recommend shorts as they are mostly short term and could go sour as Talecris is profitable. Just not enough to double the stock overnight.
9/9/09
Vivus' Qnexa Drug approved by FDA and Seeking a Partner to Sell Its Anti-Obesity Medication
Here are today's articles concerning Vivus Inc's FDA approval for Qnexa. I see this as a blockbuster drug candidate and good news for the nearly 40M Obese Americans. My only caution is later health problems as it uses some form of the fen-phen medication. This as a nice trade right now and in the future. Watch out Alli, Glaxo Consumer Health's obesity drug, here Vivus comes! Glaxo's alli just received health concerns recently over liver failure. In addition to Qnexa, Vivus also has various ongoing Phase III clinical trials for ED medication Avanafil due Oct 2009, with a long term safety study due Oct 2010.
This just in to the Wall Street Journal: Vivus CEO Ready To Roll Up Sleeves In Finding Qnexa Partner
As Vivus Inc. (VVUS) moves forward with developing its experimental weight-loss treatment Qnexa, Wall Street will be focused on the next step for the small drug developer: Finding a partner to sell the drug.
PR Newswire: VIVUS Announces Positive Results From Two Phase 3 Studies; Obese Patients on Qnexa Achieve Average Weight Loss up to 14.7% and Significant Improvements in Co-Morbidities
Results of EQUIP and CONQUER Phase 3 Studies Exceed FDA Benchmarks for Obesity Treatments, Demonstrate Positive Safety Profile
MOUNTAIN VIEW, Calif., Sept. 9 /PRNewswire-FirstCall/ -- VIVUS, Inc. (Nasdaq: VVUS) today announced positive results from two final, phase 3 pivotal 56-week studies, EQUIP (OB-302) and CONQUER (OB-303), evaluating the safety and efficacy of Qnexa(TM), an investigational drug, in more than 3,750 patients across 93 sites. The EQUIP and CONQUER studies met all primary endpoints by demonstrating statistically significant weight loss with all three doses of Qnexa, as compared to placebo. Patients taking Qnexa also achieved significant improvements in cardiovascular and metabolic risk factors including blood pressure, lipid levels, and type 2 diabetes.
Vivus Soars After Drug Hits U.S. Weight-Loss Targets
Sept. 9 (Bloomberg) -- Vivus Inc. rose 71 percent, the most in about a decade, after the biotechnology company said its weight-loss drug met U.S. guidelines in two large human trials.
Vivus climbed $4.89 to $11.80 at 4 p.m. New York time in Nasdaq Stock Market composite trading, its biggest gain since Dec. 22, 1999, when the Mountain View, California-based company asked U.S. regulators to clear an erectile dysfunction drug.
Vivus is competing with Orexigen Therapeutics Inc. and Arena Pharmaceuticals Inc., both of San Diego, to introduce a new diet drug in the U.S., a market that might be worth $10 billion annually for a safe therapy that helps patients lose 10 percent of their weight in a year, said Needham & Co. analyst Mark Monane. Global obesity levels, linked to rising rates of diabetes and heart disease, will swell 75 percent to 700 million people by 2015, according to the World Health Organization.
“We would market this drug to people with significant obesity and co-morbidities,” such as diabetes, high cholesterol and high blood pressure, said Leland Wilson, Vivus’s president and chief executive, in a telephone interview today. “This is serious medicine for those with serious disease.”
The Vivus drug, Qnexa, could generate sales of $3 billion by 2016, said Michael King, a New York-based analyst for Merriman Curhan Ford & Co., in an Aug. 20 telephone interview.
“Obesity is one of the last true, broad-based consumer markets where you can get significant revenue,” King said.
Study Results
Two 56-week studies counted patients on Qnexa who lost at least 5 percent of their weight, compared with how many on a placebo pill did the same. In one study, 67 percent of people taking the drug achieved that goal, compared with 17 percent on placebo. In the other trial, it was 70 percent, compared with 21 percent.
The Vivus studies reported today are the final stage of clinical trials generally required to seek U.S. regulatory clearance. The company said it will seek permission to sell Qnexa by the end of the year.
Patients who finished both studies followed a low-calorie diet and lost an average of 6 pounds after a year with a placebo. In one of the two studies, called Equip, people on the highest dose of Qnexa lost an average of 18 pounds when they completed the trial. In the second study, called Conquer, average weight loss on the higher dose of Qnexa was 30 pounds.
Heart and Metabolism
The study also showed “significant improvements” in cardiovascular and metabolic risk factors, including blood pressure, cholesterol levels and type 2 diabetes, Vivus said in a statement.
“To get payers in the health care system to want to pay for these drugs you need to have real benefit in altering these co-morbidities,” Wilson said in the interview. “It puts obesity into a serious disease category that insurers, employers and government want to treat in order to save money, lives and improve quality of life.”
The trials “demonstrated remarkable safety,” Wilson said.
Qnexa combines a generic form of the appetite suppressant phentermine, a commonly prescribed obesity drug that was an ingredient in the recalled diet pill known as fen-phen, with the anticonvulsant drug topiramate, the generic form of Johnson & Johnson’s Co.’s Topamax, which is used to treat epilepsy and migraine headaches.
Greater Effect
While each of the ingredients in Qnexa has some weight-loss impact, the combination of the two “has a greater effect than either of the individual components,” King said.
The positive study data will allow Vivus to accelerate discussions with “major pharmaceutical partners,”, Wilson said in the interview. That partner needs to be in place about six months before the product launch, expected in early 2011, he said.
Arena Pharmaceuticals may be the first of the three companies to ask U.S. regulators to approve its obesity treatment, lorcaserin, when it files “late this year,” Chief Executive Officer Jack Lief told analysts during an Aug. 3 conference call. The company expects to release in September the results of the second of two pivotal, late-stage studies of lorcaserin that will be used to seek approval of the drug.
Lorcaserin is similar to, but chemically different from, fenfluramine, an ingredient in Wyeth’s combination diet-drug known as fen-phen, which was taken off the market in 1997 after being linked to heart and lung problems. Studies so far have demonstrated the Arena drug is well-tolerated by patients and shows no evidence of the heart-valve damage seen in fen-phen users, the company said.
Arena Data
Experimental data released by Arena in June showed lorcaserin met one of two benchmarks required by the U.S. Food and Drug Administration to show a drug’s effectiveness. The treatment helped 48 percent of patients -- or more than twice the comparable placebo result -- lose more than 5 percent of their total body weight, the study found.
The average weight loss after one year for lorcaserin was 3.6 percent more than that of patients on a placebo. The results failed to meet a second FDA standard that an obesity drug has at least a 5 percentage point difference in weight loss between the drug and a placebo.
About 32 percent of Americans adults are obese, according to data from the Centers for Disease Control and Prevention in Atlanta. Medical spending for obesity was $147 billion in 2008, an 87 percent increase over the past decade, according to a government study published July 27 in the journal Health Affairs.
Sanofi Drug
Paris-based drugmaker Sanofi-Aventis SA withdrew its weight loss drug Acomplia from the market in Europe last year after it was rejected by the U.S. Food and Drug Administration over reports of increased psychiatric disorders. New York-based Pfizer Inc. and Merck & Co. of Whitehouse Station, New Jersey halted development of similar drugs.
Amylin Pharmaceuticals Inc., of San Diego, is working on a drug that combines pramlintide, the active ingredient in its diabetes drug Symlin, with leptin, a hormone tied to hunger.
Merriman Curhan Sees Another 20% Upside In Vivus (VVUS)
September 9, 2009 2:51 PM EDT
Merriman Curhan issued some bullish comments on Vivus (Nasdaq: VVUS) which is up 70% todya following positive Phase III results of Qnexa in Obesity, saying the stock could push toward a $1 billion market cap.
Merriman analyst Michael G. King commented in a report this afternoon saying "Vivus, with the issuance of top-line data from its Phase III trials, Equip and Conquer, has shifted the landscape for the treatment of obesity to a new level. These results open the door to a new frontier in which safe and effective pharmacotherapy for obesity now becomes the new normal. On the basis of the anticipated continued positive news flow, we would expect the shares to push their way toward a $1B market cap.
Even with today's 70% surge the market capitlization of Vivus is about $825 milion, which leaves more room to continue to Buy the shares Merriman said.
A $1 billion market cap would push shares of VVUS to about $14.30 each, based on the current 70 million share outstanding at this point. That would suggest another 19% upside!
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=1b4acf2f-9abe-4755-a97c-996c38470165)
Red Hot Novavax in talks with "half dozen" countries
This article was posted on Reuters Today about the future of Novavax.
Recent quote: NVAX Google Finance
Another great insight on the company's new vaccine technology was written by Mike Garza of BioMedReports.com and Seeking Alpha. Here is a link to that article titled:
Novavax's (Nasdaq:NVAX) VLP technology may be big news for mankind
Novavax in talks with "half dozen" countries-CEO
* Countries drawn to quicker, cheaper vaccine, CEO says
* Method 80 percent cheaper than egg-based flu vaccine
By Julie Steenhuysen
CHICAGO, Sept 8 (Reuters) - U.S. biotech company Novavax (NVAX.O) is in discussions with officials from several different countries looking for quick ways to make flu vaccines to protect their populations from swine flu and other potential pandemics, the company's chief executive told Reuters.
"We're talking with at least half a dozen countries if not more," Novavax Chief Executive Rahul Singhvi said in a telephone interview.
Although the clinical-stage biotechnology company does not expect to have a flu vaccine approved for use in the United States until 2012, it has already signed a licensing deal with Spanish drugmaker Rovi(ROVI.MC) and started a vaccine joint venture with Indian drugmaker Cadila Pharmaceuticals.
The World Health Organization predicts a third of the world's population -- roughly 2 billion people -- will eventually be infected with the new H1N1 virus, and has warned there is not enough production capacity to make vaccine for everyone.
Singhvi said the H1N1 pandemic has been a wake-up call for many governments who rely on foreign suppliers for flu vaccines. "A lot of these countries are finding out it is better to have control of vaccine supply within their own borders," he said.
He said the Rockville, Maryland-based company's technology, uses engineered bits of genetic material called virus-like particles or VLPs that mimic a flu virus. Vaccines based on VLPs can be made more cheaply in about half the time of old-fashioned vaccine methods, which use specially grown chicken eggs, Singhvi added.
Investors have embraced the stock. Since April, when the new H1N1 strain emerged, Novavax shares have risen more than 1,000 percent. The shares were up 29 cents in Tuesday's mid-afternoon trade on the Nasdaq to $5.81, up more than 1,000 percent off its 52-week low of 52 cents on April 2.
Some analysts, including Oppenheimer, cut their ratings on the company's stock to "perform" from "outperform" last week.
"They think the stock went up too much too fast," Singhvi said. "I think they're wrong, but that is for us to prove."
SIMILAR VACCINES
Several companies are working on vaccines that use similar technology. Novavax grows them in caterpillar cells, which are harvested and purified. The process is done in disposable, ready-to-use equipment.
While no flu vaccines made this way are licensed yet, VLPs have been used to make Merck & Co Inc's (MRK.N) cervical cancer vaccine Gardasil, which has been used in more than 7 million girls and women.
Singhvi, a former Merck vaccine researcher, estimates it could cost 80 percent less to build plants to make his VLP flu vaccine than conventional egg-based manufacturing facilities
"That has been attractive to other countries, and other companies in other countries, not only because it's cheaper, but also because the technology transfer is simpler," he said.
Developing a pandemic vaccine has been the company's focus since 2005, when it began making a vaccine for H5N1 avian flu. "This is not something we just started dabbling in because flu became a sexy thing," Singhvi said.
The company's seasonal flu vaccine has been through two rounds of mid-stage testing in humans. The company hopes to test its seasonal flu vaccine in the elderly this fall.
"We demonstrated our capability in this current pandemic by making H1N1 -- the novel swine flu strain -- within 4 weeks of identifying the strain and sent that to the CDC for testing," Singhvi said.
Those tests showed the vaccine protected ferrets -- which get human-like flu.
Novavax will seek approval to start human trials of its H1N1 vaccine in the fourth quarter, and it hopes to start late-stage trials in 2011. "The earliest we could get on the market would be 2012. That is under standard licensing conditions. But these are not standard times," Singhvi said.
"If the pandemic becomes very severe, I think whatever would need to be done, the U.S. government would do," he added, saying that other countries have expressed interest in a faster approval process.
Recent quote: NVAX Google Finance
Another great insight on the company's new vaccine technology was written by Mike Garza of BioMedReports.com and Seeking Alpha. Here is a link to that article titled:
Novavax's (Nasdaq:NVAX) VLP technology may be big news for mankind
Novavax in talks with "half dozen" countries-CEO
* Countries drawn to quicker, cheaper vaccine, CEO says
* Method 80 percent cheaper than egg-based flu vaccine
By Julie Steenhuysen
CHICAGO, Sept 8 (Reuters) - U.S. biotech company Novavax (NVAX.O) is in discussions with officials from several different countries looking for quick ways to make flu vaccines to protect their populations from swine flu and other potential pandemics, the company's chief executive told Reuters.
"We're talking with at least half a dozen countries if not more," Novavax Chief Executive Rahul Singhvi said in a telephone interview.
Although the clinical-stage biotechnology company does not expect to have a flu vaccine approved for use in the United States until 2012, it has already signed a licensing deal with Spanish drugmaker Rovi(ROVI.MC) and started a vaccine joint venture with Indian drugmaker Cadila Pharmaceuticals.
The World Health Organization predicts a third of the world's population -- roughly 2 billion people -- will eventually be infected with the new H1N1 virus, and has warned there is not enough production capacity to make vaccine for everyone.
Singhvi said the H1N1 pandemic has been a wake-up call for many governments who rely on foreign suppliers for flu vaccines. "A lot of these countries are finding out it is better to have control of vaccine supply within their own borders," he said.
He said the Rockville, Maryland-based company's technology, uses engineered bits of genetic material called virus-like particles or VLPs that mimic a flu virus. Vaccines based on VLPs can be made more cheaply in about half the time of old-fashioned vaccine methods, which use specially grown chicken eggs, Singhvi added.
Investors have embraced the stock. Since April, when the new H1N1 strain emerged, Novavax shares have risen more than 1,000 percent. The shares were up 29 cents in Tuesday's mid-afternoon trade on the Nasdaq to $5.81, up more than 1,000 percent off its 52-week low of 52 cents on April 2.
Some analysts, including Oppenheimer, cut their ratings on the company's stock to "perform" from "outperform" last week.
"They think the stock went up too much too fast," Singhvi said. "I think they're wrong, but that is for us to prove."
SIMILAR VACCINES
Several companies are working on vaccines that use similar technology. Novavax grows them in caterpillar cells, which are harvested and purified. The process is done in disposable, ready-to-use equipment.
While no flu vaccines made this way are licensed yet, VLPs have been used to make Merck & Co Inc's (MRK.N) cervical cancer vaccine Gardasil, which has been used in more than 7 million girls and women.
Singhvi, a former Merck vaccine researcher, estimates it could cost 80 percent less to build plants to make his VLP flu vaccine than conventional egg-based manufacturing facilities
"That has been attractive to other countries, and other companies in other countries, not only because it's cheaper, but also because the technology transfer is simpler," he said.
Developing a pandemic vaccine has been the company's focus since 2005, when it began making a vaccine for H5N1 avian flu. "This is not something we just started dabbling in because flu became a sexy thing," Singhvi said.
The company's seasonal flu vaccine has been through two rounds of mid-stage testing in humans. The company hopes to test its seasonal flu vaccine in the elderly this fall.
"We demonstrated our capability in this current pandemic by making H1N1 -- the novel swine flu strain -- within 4 weeks of identifying the strain and sent that to the CDC for testing," Singhvi said.
Those tests showed the vaccine protected ferrets -- which get human-like flu.
Novavax will seek approval to start human trials of its H1N1 vaccine in the fourth quarter, and it hopes to start late-stage trials in 2011. "The earliest we could get on the market would be 2012. That is under standard licensing conditions. But these are not standard times," Singhvi said.
"If the pandemic becomes very severe, I think whatever would need to be done, the U.S. government would do," he added, saying that other countries have expressed interest in a faster approval process.
9/8/09
Facet Biotech Rejects Biogen's Offer, will there be a counteroffer?
These articles were posted recently about Facet Biotech. Things are looking strong for their future. Especially if they can afford to reject Biogen's offer. I don't know how this will pan out. I expect Biogen should make a counter offer soon but after that anything can happen. However, if they don't make this counteroffer, I am unsure of the stock's future as it went up on speculation alone. Human Genome Science experienced this earlier, however it was over false Glaxo takeover rumors. I expect Biogen to make a counteroffer but not that much more. This is a nice article from the SF Biz Journal: Biotech spinoff Facet starts life $400M richer
Forbes.com: Biogen Idec backs $356M offer for Facet Biotech
Associated Press, 09.08.09, 04:57 PM EDT
NEW YORK -- Biogen Idec Inc. backed its $356 million buyout offer for Facet Biotech Tuesday afternoon, hours after Facet turned Biogen Idec down.
The Cambridge, Mass.-based company said its offer for Facet, which totals $14.50 per share, is "extremely attractive" and fairly values Facet's pipeline of drug candidates. Biogen Idec ( BIIB - news - people ) made its bid late Friday, and Tuesday morning, Facet said it undervalued the company.
Facet shares closed at $8.82 before Biogen made its unsolicited offer. But the stock finished up 5 percent at $16.15 on Tuesday, which suggests investors are expecting a sweeter offer.
Facet, based in Redwood City, Calif., has been working with Biogen for the last four years on a pair of drugs: volociximab for cancer, and daclizumab for multiple sclerosis.
Biogen shares closed up 17 cents at $51.18.
Facet rejects Biogen's $356M bid, shares rise
Headed into the long weekend last Friday, Biogen Idec unveiled a $356 million bid to buy Facet Biotech, which had already turned a cold shoulder to an earlier, and higher, offer last August. And early this morning Facet fired off a quick rejection, saying the offer is too low. Investors drawn to the showdown quickly lifted Facet's shares above Biogen's offer.
Biogen, which is partnered with Facet on two key development programs, offered Facet shareholders $14.50 a share--a 64 percent premium on Thursday's close. Back in mid-August Biogen was willing to pay $15 a share, but the big Boston biotech company felt that Facet's recent collaboration deal with Trubion--involving a $20 million upfront and a $10 million equity stake--shaved some value from the company.
Analysts don't expect a deal to go through at this price. Biogen Idec is offering slightly more for Facet than it holds in cash. There's also an added bonus for Biogen Idec if it can make a deal stick. Merrill Lynch notes that a deal would waive a $30 million milestone Biogen owes Facet.
Facet Biotech and Trubion Pharmaceuticals Inc. (TRBN) Announce Worldwide Collaboration for the Development and Commercialization
Facet Biotech and Trubion Pharmaceuticals Inc. (TRBN) Announce Worldwide Collaboration for the Development and Commercialization of TRU-016 in Deal Worth up to $196.5 Million
REDWOOD CITY, Calif. and SEATTLE, Wash., Aug. 28 /PRNewswire-FirstCall/ -- Facet Biotech Corporation (Nasdaq: FACT - News) and Trubion Pharmaceuticals, Inc. (Nasdaq: TRBN - News) today announced an agreement for the joint worldwide development and commercialization of TRU-016, a product candidate in phase 1 clinical development for chronic lymphocytic leukemia (CLL).
TRU-016 is a CD37-directed Small Modular ImmunoPharmaceutical (SMIP(TM)) protein therapeutic. The collaboration agreement includes TRU-016 in all indications and all other CD37-directed protein therapeutics.
"TRU-016 is a promising therapeutic with impressive preclinical and preliminary clinical data for CLL that will greatly enhance our pipeline and support a key strategic objective, which is to build a robust oncology portfolio," said Faheem Hasnain, president and CEO of Facet Biotech. "After a thorough evaluation of a number of programs over the past several months, we concluded that TRU-016 was a particularly compelling program and a great fit with our pipeline and expertise. While the novel approach to protein therapeutics is supported by a solid biological rationale and validated clinical data in CLL, TRU-016 may have broad utility in additional indications, including non-Hodgkin's lymphoma and multiple sclerosis. Through this collaboration, we can leverage and extend our significant expertise in the research and development of protein therapeutics and we look forward to playing a key role in advancing this important program with our partners at Trubion."
"In considering alliance opportunities for TRU-016 we sought to retain meaningful economics in this exciting first-in-class product candidate, while enabling aggressive joint development with a partner who shared our vision and brought complementary experience and resources to the alliance," said Peter Thompson, M.D., FACP, president, CEO and chairman of Trubion. "We are delighted to have Facet as our partner. Coupled with our own strengths in the discovery and development of novel protein therapeutics, their expertise will afford us the opportunity to pursue the clinical development and commercialization of TRU-016 and other CD37-directed therapeutics in the most aggressive manner possible."
Under the terms of the collaboration agreement, Trubion will receive an upfront payment of $20 million and may receive up to $176.5 million in additional contingent payments upon the achievement of certain development, regulatory and sales milestones. The companies will share equally the costs of all development, commercialization and promotional activities and all global operating profits. In addition, Facet will purchase 2,243,649 shares of newly issued Trubion common stock for an aggregate purchase price of $10 million.
9/7/09
Top Weekly Performers in Biopharma
Top Weekly Performers from:
Fri 04 Sep vs. Fri 28 Aug
Top 15 Gains (%) - ranked on change in share price
Rank/Company/Currency/Market Cap/Change in Market Cap/Notes
1 Nutra Pharma USD +89% 74M +34
Sep 2: Shares rise on 12.5x average daily trading volume.
2 Aerocrine SEK +65% 144M +57
Sep 3: Health Canada approves Aerocrine's Niox Mino, a medical device that measures inflammation in the airways, for use in treating asthma.
3 Peplin AUD +50% 129M +43
Sep 2: Leo Pharma announces agreed takeover of Peplin, for $288m.
4 Facet Biotech USD +48% 378M +123
Sep 4: Company receives a hostile takeover offer from Biogen Idec at $14.50 per share, having previously rejected a $15 per share offer; Biogen's offer values Facet at $355m, only around $45m higher than Facet's estimated cash of $310m; Facet's shares closed at $15.38 suggesting that the market expects Biogen will eventually have to raise its bid to close the deal.
5 The Medicines Company USD +46% 583M +184
Sep 2: Company announces that it has received a new patent from the US patent office for its anti-clotting drug, Angiomax, raising analyst hopes that onset of generic competition for the drug will be delayed.
6 Sinovac Biotech USD +45% 388M +120
Sep 3: The Chinese State Food and Drug Administration (SFDA) issues a production license for the company's H1N1 swine flu vaccine, Panflu, prompting the company to raise its revenue guidance for the year to greater than 20% growth. 31 Aug: Company receives a positive opinion for Panflu by an expert committee held by the Chinese SFDA.
7 Diamyd Medical SEK +36% 162M +42
Sep 3: Company reports 4-year follow-up data from a phase II trial of type 1 diabetes patients who received just two injections of Diamyd vaccine.
8 Jazz Pharmaceuticals USD +31% 287M +68
Sep 4: Shares rise on 5.5x average daily trading volume.
9 Transcept Pharmaceuticals USD +24% 164M +31
10 Algeta NOK +24% 337M +64
Sep 3: Company licenses global rights to its phase III, bone metastases cancer drug, Alpharadin, to Bayer for $61m upfront and potentially $800m in total, whilst retaining a 50% co-promotion and profit-share option in the US; Bayer will cover the majority of further developmental costs for Alpharadin.
11 AVI BioPharma USD +23% 191M +36
Shares of companies engaged in the development of a swine flu vaccine rise following a positive recommendation for Sinovac Biotech's swine flu vaccine in China on 31 Aug.
12 Protalix BioTherapeutics USD +23% 565M +107
Sep 3: Shares rise to a one-year high of $7.57 on increasing confidence in the company's Gaucher disease product, prGCD, and heightened speculation the company is a takeover target given its low cost plant cell-based biological manufacturing technology. 2 Sep: Hapoalim Securities initiates coverage with an "outperform" rating and price target of $10, claiming Teva could be a likely acquirer. 1 Sep: Shares rise on 5.5x average daily trading volume.
13 Sepracor USD +23% 2533M +470
Sep 2: Shares rise to a five-year high prior to a halt in trading on news that the company is to be acquired by Dainippon Sumitomo Pharma for $23 per share, or $2.7bn in total.
14 Cellectis EUR +21% 186M +33
Sep 1: Monsanto licenses the use of Cellectis' genome modification technology for the development of meganuclease technology in plants; company to receive €3m upfront, milestones and royalties.
15 Curis USD +21% 159M +27
Sept 2[post-market]: The New England Journal of Medicine publishes two encouraging papers on GDC-0449, a drug which targets the hedgehog pathway, including phase I data from a trial in the rare skin cancer basal cell carcinoma; Curis and partner Roche have a phase II trial in the indication ongoing; the papers raise hopes that the drug will prove successful in fighting skin cancer and possibly other tumour types.
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=e6d1555e-5840-47f7-acab-87421f126e1a)
Death and Taxes, Consider Taxes before selling stocks
I saw this article in the paper today and thought it was good advice. Always take into consideration the Capital Gains Taxes when selling stocks. No one enjoys being in tax trouble and have had my fair share of taxes. Luckily I have been able to redo some of my taxes and negate some of the government's taxes they thought I owed them. Not fun. Anyways, always consider taxes when buying and selling stocks. If not you will receive a nice letter from the IRS next year with some explaining to do.
Here's a nice look at where your taxes go. It's called the Death and Taxes Chart by Wallstats.com Just click on it to enlarge.
Wikipedia on 2009 Capital Gains Taxes.
Capital gains tax in the United States
Consider taxes before selling stock
BY HOLLY NICHOLSON - Correspondent From the Raleigh News & Observer, another broke paper out there.
Sun, Sep. 06, 2009 02:00AM
Q: After having lost so much money in the stock market last year, when a CD matured in early March my husband and I decided what the heck and took a leap of faith in the recovery of our financial system. We bought three bank stocks.
We invested a total of $60,000 putting $20,000 in each stock. One we bought around $15 a share, and it is now trading at more than $25 a share. Another has gone from $10 a share to more than $25, and the last one was purchased for $2 a share and is now trading around $5 a share.
The total value is now more than $134,000. My husband wants to hang on to these stocks, and I think we should be content with the stock price increases and sell now. I don't know as much about stocks as my husband, so he suggested I write to you and get your opinion, should we sell these stocks or keep them? He told me that you may need to know that we are near the top of the 28 percent federal tax bracket.
Reply: That gamble worked out well for you! Many financial stocks have had a nice rebound since their March lows this year. I'm not sure about the other two stocks, but the $2 a share stock must be Citigroup. It took a lot of nerve to invest $20,000 in this bank stock back in March.
Unfortunately, I can't predict whether the prices of these stocks will increase, decrease or remain the same. The financial sector of the market is less unstable than it has been late last year and earlier this year, but it is still uncertain.
If you sell now, all gains will be short-term capital gains and taxed at ordinary income rates since you have owned these stocks for less than a year. If you are near the top of a tax bracket, a sale could propel you into a higher bracket.
In 2009, a married couple filing jointly will pay 33 percent federal tax on taxable income above $208,850 and 35 percent on taxable income above $372,950.
If you wait and sell after you have held the stocks for a year, you will pay tax at the long-term capital gains rate. Currently this is 15 percent for those in tax brackets above 15 percent and zero for those in the 15 percent and lower tax brackets.
Long-term capital gain rates will revert on Jan. 1, 2011, to pre-2003 levels unless Congress extends the current law. The rates for those in the 15 percent or lower brackets will be 10 percent and for those above the 15 percent bracket the rate will be 20 percent. There is wide speculation that in the near future, the capital gains rate for taxpayers with a taxable income of $250,000 and greater will increase to a rate higher than 20 percent.
If you can wait and sell in March 2010 and qualify for the long-term capital gains treatment, you will save the difference between your ordinary income tax bracket and the long-term capital gains rate.
If selling now puts you in the 33 percent federal tax bracket, you will save 18 percent in taxes by waiting to sell until you have held the shares for a year when the proceeds will be subject to the 15 percent long-term capital gain tax. If the share value declines by 18 percent between now and March 2010, you would have been better off selling now. If you don't think they will decline by more than 18 percent, you should wait until next year to consider selling the shares.
9/4/09
Pfizer Hit With Record fine, but unlikely to end bogus drug marketing
Image by Arturo de Albornoz via Flickr
This is a list I have compiled of Lipitor Marketing Reports by Pfizer.
Glaxo's cancer vaccine inches toward approval--Merck's Cervarix vs GSK Gardasil.
By MATTHEW PERRONE - AP Business Writer
Published: Fri, Sep. 04, 2009
WASHINGTON -- Federal regulators said Friday that a GlaxoSmithKline vaccine prevents the leading cause of cervical cancer in women, bringing the company one step closer to competing with Merck's blockbuster Gardasil, which has controlled the U.S. market for three years. GlaxoSmithKline(GSK) Google Finance
In documents posted online, the Food and Drug Administration said Cervarix - Glaxo's vaccine against human papilloma virus or HPV - successfully blocked the two leading strains of the virus nearly 93 percent of the time.
But even as the British drugmaker moves closer to competing in the U.S., Merck is poised to begin marketing Gardasil to boys and men. In a separate review, the FDA said that vaccine prevented genital warts in males 90 percent of the time.
The agency will ask a panel of vaccine experts next week to weigh in on both vaccines. The FDA is not required to follow the group's advice, though it usually does.
While Merck has suggested the approval for boys could double the potential market for Gardasil, Leerink Swann analyst Seamus Fernandez said the benefit likely will be minimal.
Genital warts caused by HPV usually clear up by themselves, and the cancers caused by the virus are extremely rare in men.
"If it's not preventing something serious like cervical cancer and there are questions about safety, I think parents' acceptance of the vaccine in young boys might be less urgent than for their girls," said Fernandez.
Glaxo has won a number of government contracts for Cervarix in Europe, but its U.S. launch was delayed in 2007 when the FDA said it needed more data about the vaccine. Earlier studies of Cervarix showed a higher number of muscular and neurological problems among patients who used the vaccine compared with an alternate treatment.
The FDA said Friday that outside experts have now determined Cervarix did not cause those problems.
"The conclusion in the case of each of these efforts was that the data are not sufficient to establish a link," the agency said in its review.
FDA reviewers also noted a slightly higher rate of miscarriages in women taking Cervarix, but said "the data do not establish a causal relationship."
Glaxo wants its vaccine approved for girls and women ages 10 to 25. The FDA is expected to make a decision on the vaccine later this year, but analysts say London-based Glaxo may still have trouble making inroads into the U.S. market.
Gardasil and Cervarix both defend against HPV strains 16 and 18, which cause about 70 percent of cervical cancer cases. But Merck's vaccine also defends against two other HPV types that cause 90 percent of genital warts, something Cervarix does not target.
The most common side effects with both vaccines were pain and swelling at the injection site.
Gardasil became an early success story for Merck after its 2006 launch, achieving sales that are rare for a vaccine. The company has sold about 50 million doses worldwide, with more than $1.4 billion in revenue last year.
But sales have been slowing amid questions about the longevity of the vaccine's effect and its price tag of nearly $400. In the most recent quarter, Gardasil sales fell to $268 million, down 18 percent from the prior year period.
A government-funded study last year found that the HPV vaccine is cost-effective for young teens, but not for women in their 20s. And labeling for the vaccine notes that the "duration of protection of Gardasil has not been established." Company trials have only tracked immunity out to five years after receiving the three-injection regimen.
Whitehouse, N.J.-based Merck will make the case on Sept. 9 for approving the vaccine for boys and men ages 9 to 26.
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=7b965007-456e-4fcf-8f32-ad7e65762697)
9/1/09
Swine Flu Humor
Just looking for some humor on a tough day on Wall St today. I have found some funny things on Swine Flu humor and some crazy guys at DopeyCowboys.com. Yet again a break from my business articles. Can't be business all the time.
This was their disclaimer from Dopey Cowboys.
Take a break from your mundane corporate trading life and enter the belligerent, biased and sometimes pig-headed world of DopeyCowboy.com. We hate your job more than you do. In fact, we hate pretty much everything. Let’s face it, making fun of people is much more satisfying than meeting any deadline. DopeyCowboy.com’s blogs are written independently and privately by a small group of antagonistic Wall Street traders who see their world for what it really is.
![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=222e4822-3acf-4d3e-8f7e-370a66a67f11)
Acadia High Risk-Low Reward
Today, Acadia announced less than favorable results from their Phase III clinical trial for Pimavanserin. You can read about this from Street.com's article Acadia Parkinson's Drug Fails Phase III trial and plans to slash 50% of its workforce according to Marketwatch.com's article. Business Wire has a good look at the news earlier this morning as ACADIA Pharmaceuticals Announces Results from Phase III Trial of Pimavanserin in Parkinsons Disease Psychosis. I don't think anyone really saw this coming with such positive news in the past.
This really is devastating news as it was their primary moneymaking drug. Citi analyst Dr. Lucy Lu downgraded shares of Acadia to "Sell" from "Hold" and reduced her price target to $1.50 from $4.50, citing the study failure. She said slashed 2011 revenue estimates to $8.4 million from $23.3 million and 2012 estimates to $7.6 million from $46.3 million. The stock dropped considerably losing close to 68% of its value in early trading. Yesterday Acadia (ACAD) was trading at 5.84 and at this moment is around 2.00 at closing. But what does Citi know as they are struggling themselves with TARP payments.
Upon reviewing this a little closer it makes sense, and I wish I could have written about the caution of this stock before today. Anyone who has taken Psych classes understands the Placebo effect and how patients suffering from Psychosis sometimes pretend to feel better based on a placebo alone. Just searching google I found a nice Psychosis Placebo effect book and it has a nice excerpt on Understanding the Placebo effect. The mind works in mysterious ways and we can trick ourselves into feeling better or worse. This isn't good for drug companies trying to pass Clinical Trials. Another Placebo effect study done by Columbia University is titled: Researchers Demonstrate How Placebo Effect Works in the Brain. Many psychosis medications are hard to judge their efficacy.
I do think the drug does have some positive effect and did not impair disease-related motor function in patients with PDP. This was their major pipeline drug but they do have options here and look at what went wrong. They will continue with their second Phase III trial on Parkinson's Disease Psychosis or PDP. They still can try clinical trials with Alzheimer's patients and have other drugs in Phase I/II trials. AGN XX/YY is in Phase II, partnered with Allergan, for Chronic Pain, and AC-262271 for Glaucoma in Phase I. Other Programs can be found on there website here.
But the key here is to do your homework. Diversify, Diversify and Diversify. Do not put all your money into 1 biotech stock as these are very high risk, and sometimes low reward. Invest in the Long-Term. 10 years from now this stock might just make it and you just have to wait and see. Look at their financials, see what they have going on if the Clinical Trial Fails. Do they have more than one application for their medication. In this case they do so I see Acadia bouncing back eventually.
This is one of many drugs that fail in Clinical Trials. A nice look at BioPharma investing shows that Failed Trials Can Spell Startup Disasters. Even the big BioPharma companies take huge risks with Clinical Trials. Just look at Pfizer and their struggles to get past the daunting, ever-dreaded Phase III lately. It is a gamble and you shouldn't be in it if you are not prepared to take losses. Other huge setbacks have been felt by Savient, Biogen, Hemispherx, AEterna Zentaris, and Dendreon. Some eventually get past it, some don't.
My advice is this. Diversify to reduce risk. If investing in stocks, only buy around 5-10 percent of your portfolio in each one investment. If you want a higher risk/return ratio invest more but be prepared if the trial fails. Or you can just get out of Clinical trials altogether and just wait for approval. Another way is to invest in Big Pharma. They can take a hit and still move past it.
Don't panic, it happens to everybody in BioPharma investing. Sometimes we fail, get yourself up and "Don't give up, Don't Ever Give Up" Jimmy V. Just look at Steve Jobs. He too once failed, here is a nice speech from his 2005 Stanford commencement address.
Subscribe to:
Posts (Atom)