BioSante Pharmaceuticals, Inc. (BPAX)

[Just the facts maam]

I sent an e-mail this morning which was later followed up with a phone conversation to discuss the issues. (Once again Simes answers in red.)

QUESTIONS SURROUNDING THE SAFETY TRIAL

What prompted the change to the safety trial involving 3656 patients to two points thereby involving a patient group more at risk of a CV event?

They were not getting enough CV events with the one CV risk criteria so they had to get a patient population more prone to a cardiac event.

I have provided a timeline of events which I have collected from various publicly available sources in relation to Bioante, Solvay
and Abbott.

The following is the info that I had uncovered regarding peculiarities that increased the likelihood of assistance and an interest on the part of Abbott and/or Abbvie (now).

Linda Andrews et al irregularities

Libigel Trial change November 12, 2009

Testosterone older men trial changes November 12, 2009

I am not saying that any agreement was in place at the time, as many of you would not have bought shares, for risk of insider trading conflicts. But you have to admit it is very suspicious to say the least.

As a result of compiling this information, it raises many questions.

Many of us question the relationship of Linda Andrews, Dr Sandra Croak-Brossman and the events of Abbott announcing the offer to buy Solvay Pharmaceuticals and the timing of Linda Andrews assisting Biosante followed by clinical trial changes the same day at Solvay and Biosante regarding testosterone. We also know that both Linda and Sandra had worked at Pfizer for a considerable number of years.

But when Linda Andrews posted this in her experience at Biosante as

Prepared documentation for FDA Regulatory Submissions (i.e., new investigators, CVs, protocols, amendments, newsletters, correspondence, source document worksheets and CRFs)

Note: In our conversation on February 26 , 2013, you stated that she would have been nowhere near document submission to change clinical trials.

She claimed she worked for Biosante and Abbott at the same time from November 2009 to March 2010 only to find out that she had later deleted her work experience indicating her time at Biosante during the period from November 2009 to March 2010.

Everybody, not just myself saw something was not above board here.
We also started questioning the relationship between Linda and Sandra especially since Sandra was hired by Biosante in July 2011.

With respect to Linda Andrews he claims that he doesn’t know her others remember her vaguely. And that he definitely did not have any input on changing trials protocols or criteria. It wouldn't be the first time someone beef up their work experience, who knows?

As for how Linda Andrews got hired and her relationship with Sandra Croak-Brossman. Simes does not know anything about that they may have known each other from Pfizer but he does not know anything about that.

He did say he has nothing but the highest respect for Sandra Croak-Brossman. Biosante tried to get her to stay with Biosante, but she did not want to deal with the risks of a small biotech.

He did agree that the change to two testosterone (Androgel and Libigel) trials that on the same day is very odd, but an odd coincidence.

LIBIGEL SAFETY TRIAL
The following info is from ClinicalTrials.gov Identifier: NCT00612742

Official Title: A Phase III, Randomized, Double-Blind, Placebo-Controlled, Multi-Center Study of the Long-Term Safety and Efficacy of LibiGel® for the Treatment of Hypoactive Sexual Desire Disorder in Postmenopausal Women

Study Type: Interventional
Study Design: Allocation: Randomized
Endpoint Classification: Safety/Efficacy Study
Intervention Model: Parallel Assignment
Masking: Double Blind (Subject, Investigator)
Primary Purpose: Treatment
Libigel long term Safety - efficacy trial

Libigel Safety trial

Excerpt from Biosante news release

BioSante currently has two Phase III clinical trials in progress covered by an SPA (Special Protocol Assessment) with the FDA, to demonstrate the safety and efficacy of LibiGel (testosterone gel), in the treatment of HSDD. In addition to the two LibiGel Phase III safety and efficacy trials, BioSante is enrolling women in a Phase III cardiovascular and breast cancer safety study of LibiGel. Pursuant to a written agreement with the FDA, this one safety study will serve as the basis of safety for both surgically and naturally menopausal women. The safety study is a randomized, double-blind, placebo-controlled, multi-center, cardiovascular events driven study of between 2,400 and 3,100 women exposed to LibiGel or placebo for twelve months. At the end of the twelve months, BioSante intends to submit a LibiGel New Drug Application (NDA) for review and possible approval by the FDA. BioSante will continue to follow the women enrolled in the safety study for an additional four years after the NDA submission and possible approval of LibiGel.

BioSante holds two SPAs for LibiGel for the treatment of FSD; one for "surgically" and one for "naturally" menopausal women. "BioSante's SPAs confirm the FDA's position that FSD and HSDD are true diagnosable conditions that women experience, with measurable endpoints that can be evaluated and which deserve therapeutic options. Regarding LibiGel specifically, we are pleased that the SPAs affirm that our clinical trial design, endpoints, sample size, planned conduct and statistical analyses are acceptable to support regulatory approval," said Stephen M. Simes, BioSante's president & CEO. "We have a clearly defined, reasonable and feasible LibiGel development path that can lead to the approval of LibiGel to provide potential benefit for a broad population of menopausal women.

"

Biosante News release dated November 11, 2008


Now please explain where the efficacy trial data was going to be obtained?

The only trial with a naturally menopausal women population was the one commonly referred to as the safety trial, which was completed according to Biosante September 4th 2012 news release.
Upon reading: “A cardiovascular safety study of LibiGel (testosterone gel) in postmenopausal women with elevated cardiovascular risk and hypoactive sexual desire disorder”. I was able to extrapolate that if the enrollment ratio remained proportional there would be as many naturally menopausal women as there was in the two efficacy trials for surgically menopausal women.

Libigel trial publication from American heart Journal

Simes stated that it is true they had SPA for post menopausal women, but never conducted any efficacy trials for menopausal women anywhere. They chose to complete the portion for naturally post menopausal women in the safety trial so that in the future a safety trial would not be needed.

It certainly appears that efficacy for naturally post menopausal women was to be obtained from within this trial to be within this trial.

If so was did it use weekly or daily diaries?

No since there was no efficacy trial

Was the trial set up similarly to Intrinsa which was referenced in the article?
No again for same reasons.

Questions regarding analysis of the safety Trial data

Alfreida Borieka, a Clinical Trial Safety Manager, Pharmacovigilance returns to Abbott in May 2012 (near end of 1 yr mark for last enrolled patient) after 20 months. At around the same time Jeanette Shapiro leave Abbott to work for Biosante as a

Clinical Data Reviewer
[url]
www.linkedin.com/pub/alfreda-boreika/2a/961/a25[/url][tag]Alfreda Boreika[/tag]

Jeanette Shapiro


It appears on the surface that some level of analysis was underway even though the company line was you were blinded.

Your earlier PR statement and presentations left shareholders with the impression that the safety trial analysis would commence once the last enrolled patient reached the one year anniversary. Yet hiring Shapiro speaks to some level of review and analysis.
If efficacy was actually being monitored within this trial, were you fully blinded to this data as well?

He stated that the only information they have been privy to is the CV events which have to be reported as they happen. That no one other then the Data Monitoring Committee has had access to the data at Biosante. The cost of examining the data could take anywhere from $6 to $10 million to complete. For continuity purpose in the event ANI or another company wants to pursue the analysis they have up boxed up all the data and it is being stored offsite

VALUATIONS
Most are also dismayed at the valuation provided Biosante. I others have watched the trading trends of Biosante and often you would see larger buys in the 20,000 to 30,000 share vicinity wiped out by 100 to 200 share purchase. I have seen this consistently happening. Biosante has been heavily manipulated since December 14, 2011. So using the share price for a 5 day window during a period of major manipulation in October was all the more reason a proper analysis was required. Once again it harms your credibility.

Finally since a proper Discounted Cash Flow analysis for all products in Biosante’s Pipeline was not conducted other then Bio-t-gel (now Tesneo) and aggregated which appears to be among the most equitable ways of valuing a biotech such as Biosante.
If you intend to stick with these valuations, the general consensus is that since the value attributed to Biosante was used to determine the exchange ratio and many of Biosante’s products were given zero value. Then the shareholders at least deserve a CVR for each product given zero value, there are quite a few. This would also include GVAX was sold for $1 million dollars and was valued between $1 and $2 million therefore all feel a CVR for shareholders would be justified.

Note: The CVRs should not be at the discretion of the Board. Make it concrete so there is no doubt that the CVR’s will be issued. That is also one of the reasons you have a credibility issue. Most feel they may not be issued. If you want people to start voting for the merger you cannot leave any ambiguity.

He stated that regarding GVAX the FDA has only approved one vaccine Provenge by Dendreon and it is not performing financially as well as expected. This has cooled the demand. In addition since they are in Phase II trials, Aduro and or their partners will have to spend hundreds of millions to get it to approval. As a result they got a royalty rate from Aduro in the mid single digit range.
He then explained how they came about acquiring Cell Genesys. It was during the financial crisis and money to finance biotech was scarce. They gave up less of the company then they would have had they sought financing.

They chose ANI among the other suitors because ANI gave away the largest percentage of their company and had a better fit along product lines.


As for additional CVR ‘s, I tried, Simes said ANI won’t reopen the negotiations. It is what it is.

In closing it was interesting that Simes stated that even though he is recommending the merger he is okay if the vote is against the merger. They would have to come up with different strategy but he gets to keep his job.

Simes admitted that their concern presently is not so much whether we vote for or against the merger but to get enough votes to make it count. They need enough share holders to validate the merger vote. (This is probably why we are see the push from both proxy services and Simes is calling individuals)

In relation to the talk about the money, Simes stated that Biosante still has to pay off the Kevin Tang $8 miillion note legal fees and business wind merging costs lawyers etc… If the merger goes through they will have around $18 million.

Make of it what you will.

I know some have questioned whether it is Simes on the other end of the phone. I have heard and viewed many presentations and I believe it was him or a very good impersonator.

Chose to believe this or not but he stated that the majority of votes coming in have are in favor of the merger and is looking at approaching the SEC about getting authorization to release the results to date.