Titan Pharmaceuticals Inc (TTNP)

[TRUISM]

How To Beat The Herd Mentality: Highline's Michael Higgins [Excerpt On TTNP]
Source: George S. Mack of The Life Sciences Report-February 27, 2015
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It's taken me some time to see it, but I've come to appreciate that the biggest growth segment in this market today is in the number of mature, "stable" opioid addicts. If you know one opioid addict, you know one opioid addict--you don't know them all. I don't think investors understand the zillion faces of opioid addiction. While there aren't official statistics for this "stable" group, they encompass any addict that has become "relatively" clean, has surpassed those initial few embattled years of sobriety, and is now truly focused on sobriety. For those living with this type of chronic condition, I believe Titan Pharmaceuticals Inc.'s (TTNP:OTC) six-month implant of Probuphine (buprenorphine hydrochloride implant) will be the leading non-oral choice.



TLSR : With the implant, Titan is bypassing or circumventing the problem of noncompliance, right?

MH : That's right. You can scan the brains of opioid addicts and see their addictions. Except for Alkermes, the active ingredient in these companies' addiction products is buprenorphine. It's a partial opioid agonist that provides pain relief without the euphoria of full agonists like heroin, oxycodone (OxyContin), hydromorphone (Dilaudid) and others. Currently, addicts are supposed to take a sublingual pill of buprenorphine every day. It's a daily test that at least 60% of addicts fail. I believe Titan's Probuphine, a series of four rods of 80 mg of buprenorphine that's linearly released, is ideal for the addict who wants to take a pill every day but is physically addicted to opioids.

TLSR : Titan's shares have been relatively weak over the last two years. What is the issue here?

MH : Probuphine is Titan's only clinical asset, and in April 2013 the company received a complete response letter (CRL) from the FDA. The stock will sit in the penalty box until investors fully appreciate why Titan got the CRL, and what kind of revenue opportunity sits in front of them. The company is now running a fifth Phase 3 trial, called PRO-814, to address the CRL. We're looking for positive Phase 3 results in roughly three months in what we're calling a "patient-ranging" study versus a typical dose-ranging study. Randomized patients are taking half the dose of Suboxone they were in the first four Phase 3s, while Probuphine's dosing remains the same.

TLSR : How will this study answer the FDA's concerns?

MH : Despite the majority of the March 2013 advisory committee (AdCom) voting to recommend approval based on Probuphine's efficacy profile, safety profile, REMS and overall effectiveness--four separate votes--the agency's CRL asked Titan to show the effect of Probuphine when buprenorphine levels more closely approximate the blood plasma levels of Suboxone. The agency looked past the clinical outcomes that the AdCom looked at, and instead focused on the plasma buprenorphine levels. It was an issue during the AdCom, but I was shocked to see the CRL.

The design of the ongoing Phase 3 is the same as the prior two Phase 3s, except that the enrolling opioid addicts are stable on half the dose of Suboxone. The primary endpoint continues to be a comparison of urine scores that are negative for opioids. There's no reason to believe Probuphine will be less effective than Suboxone in patients that are stable on a lower Probuphine dose. It's unlikely that Probuphine will deliver too much buprenorphine because it's a partial opioid agonist, so its euphoric effects are muted. This is an opioid treating opioid addicts, and doctors want to lower the dose to wean their patients off buprenorphine. But most studies show that takes a long, slow taper. A lower dose would work better as a tapering method. But the risk that too much buprenorphine in these addicts will mean Probuphine is less effective than Suboxone is, we believe, very low.

TLSR : Having an implant would rule out the possibility of a child getting hold of flavored sublingual films and tablets. Very young children have ended up in the emergency department or intensive care unit for eating these products. Should the FDA consider this? Could this be a value driver?

MH : You've done your homework! The amount of new information coming out on this topic is incredible. KOLs are increasingly aware of this issue. It's an increasingly bad problem. In my recent notes on Titan, I've quoted several papers that discuss this topic. Addicts share with addicts! Sometimes to "take the edge off." Sometimes to entice others to start abusing opioids. More often they lean on Suboxone during the week so they can work, then go off for a few days and get high on the weekends. But the hardcore addicts aren't that strategic. They use "Subs" when the money runs out.







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