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Go read The Billion Dollar Molecule - bunch on Boger. Many think he is bright but arrogant and probably way too over-confident. He does LOVE to hear himself speak.
I found an alternative for Tyzeka scrips and will post later in the week when I am on right computer to access data. I can say last few weeks have not recovered the drop from 2-3 weeks ago yet.
Jon
Disclosure: Minor IDIX long position, Minor VRTX long position, both using short puts struck below current prices. Was longer IDIX but cost myself a bit trimming mid-week last week (cut loose July 7.50 calls at a good price but cut loose some long shares too late and price now higher again).
I was short 5,000 shares worth of 12.50 puts and living in Hong Kong, went to bed at 2 pm EDT (2 am here) with all my short option strategies apparently expiring worthless. Woke up relieved to see that all my positions did expire worthless but as quite shocked to see the near hit in RPRX. WoW!
If the the $10.75 does come true, I will be owning 10K shares from my July/August put writes.
Jon
OT ENCY
There has been some discussion that one of the investigators might have messed up - I assume if FDA threw out his data, it could make p value go above .05. That would lead to statement about unproven efficacy and to my mind is classic, FDA statistical doubletalk. I guess Canada, Europe and Oz are stupid. I hope your $2.60ish is correct, as I would come out relatively unscathed. Below $2.20 or so and I feel some pain.
Jon
Where is the chart?
Jon
My source has been discontinued - sorry about that.
Jon
MS - downgrades to Equal Weight with no target from Overweight and $15
JPM - Maintain neutral.
Sus - Downgraded and high $6 fair value.
Citi - Maintain hold and $8 target.
Weisel - Maintains hold and $8.
Jon
Yes - that is certainly a fact. The overall background rates of PCR negative though are also very high. It must have been an easy population to treat in some way.
Jon
Thanks Pete.
Jon
Which newsletter was that if you don't mind - sound smart.
Jon
I sold my speculative long option position at minor gain after the open. I sold my long shares at break even for the day and close to break even overall. I lost a bunch of money keeping short puts out. Today's news removed one worry but added others - I personally still think the overall numbers in all arms were so high that it would have been very high to get much higher difference. I also think the 20% difference at the midpoint check and >10% change at week 4 will hopefully cause a re-gapping out when SVR data are known.
Jon
Those PCR negative numbers are very large in all groups except the non-riba arm - interesting population in some way.
Jon
ASPV,TRMS, VPHM in same boat, as revenues present or coming but how does it conform to future share price?
But they all are profitable and sell at 10x PEs. ISV when adding in the costs is breakeven to modestly profitable. At 10 PE, you have lower price than today. Sorry for delayed response - travelling in SE Asia.
Jon
He seems to forget one whole layer in his analysis - ISV costs. They currently have a cost layer at their level equivalent to 10-15 cents and they will pay royalties to PFE (low single digits) on ISPH sales levels. His numbers appear to be the royalties per share to ISV unless I am mistaken - he does not give full details but my math when reading the article (in my head while scanning) suggests this.
Take 15-20 cents off his EPS numbers and re-do the math - not as compelling. Also, some folks see peak sales in the $50 MM range and others (rodman) think it could be a couple hundred for the first product. ISV is very overvalued given its cost levels if the lower numbers are right. I have a feeling $100-150 MM may be reasonable and ISV becomes interesting if it did not have so many shares and if its costs weren't in the way.
Jon
From everything I have read, it appears both thelin (ency) and amb... (gild/myog) are superior to tracleer. And amb... is superior to thelin. Amb... appears to have best efficacy (hard to really tell since you CANNOT compare across trials) but no head to head data against anyone. It also would appear to have best side effect profile with limited effect on liver function (but they seem to have used a methodology which is much more aggressive than the other two but apparently this did not stop FDA from accepting the application). They also have fast track, which does not necessarily increase odds of approval - simply means FDA thinks more treatments are needed for this indication.
Thelin appears equivalent on efficacy and slightly better on safety to tracleer. On safety, it would appear much safer on liver function (1/4 or so events of raised levels vs. tracleer and close to placebo - amb... claims 0% vs. thelin 3% but again methodologies are different with amb.. needing 2 raised measurements in a row. On other side effects, thelin has drug-drug interaction issues with warfarin (common drug in patient group) while tracleer does not. Tracleer appears to have issues with drug-drug on revatio (Viagra). Thelin was run in head to head trials vs. tracleer and was as above.
Based on the above, I would think you were correct in your assessment except I would not expext no post-marketing studies. Problem is that there appears to be an issue with FDA and NO ONE knows why. Buzz of medical community by the way seems to be that both will be approved even given these facts. Thelin is basically approved globally except US and Asia at this point (Canada, Europe, Australia, ...). Database of users up over 1000 vs. 500 or so for amb...
Buzz of analyst community seems to be GILD approved no problem and thelin may or may not be approved. For the analysts (except Punk), it does not really matter. They expect GILD to dominate new patients with share trends on order of 40/40/20 for tracleer (entrenched share, why change if not having side effects and having efficacy), amb..., and then thelin. I have seen numbers as skewed as 20-30/50-60/10-20. Even Punk is something like 20/45/35 if memory is right. Remember Viagra vs. Cialis - usage comes down to several factors including label, trial results, real world results, marketing, entrenched bases. Viagra still outsells Cialis 2-1 despite efficacy differences (shorter acting) and perhaps more safety issues. Analysts BELIEVE in amb.. superiority and GILD marketing might along with tracleer entrenched base and its owner's (Actelion) marketing might in this space. They view Given and company as much weaker.
Additionally, remember that ENCY has $100+ MM of debt if royalty backed debt included. Nothing is near the marketing stage except Thelin and the approved drug on which they get royalties. Thelin in ROW is probably worth $100-150 of peak revenues. I believe $3-5 is supportable by the royalties and the ROW but expect failure to lead to $2.50 or so. Upside is probably to $6-7 if approved this week and then to $8-10 if GILD not approved (anything except approved/approvable for label). If GILD gets the nod too, back down to $5-6.
Jon
NEBIDO just doubled analysts' expectation on pricing for what it is worth. Could help A get even higher pricing if ever approved. More important - will help set stakes for any negotiations.
Jon
PS Zip mentioned Nebido is being viewed as a long-acting form of something already approved. A is a new mechanism.
This is also the reason WPI just gave up its exclusivity on a generic and sold the right to another generic player if memory serves.
Jon
Having read the IDEV analyst stuff, all of the analysts seem to think Nebido approval is pretty standard stuff - no one seems concerned or has mentioned QoL.
Jon
VRUS: Given low volume buying/selling moves stock around at will. Look at today's open - would have been good time to get first bit. I will wait for awhile myself and do some more research.
Jon
Options out to August look expensive to me. I have sold a very small amount of puts out to that date at strikes from 7.50 to 12.50. Would have made much more money just going long the stock but every trade I have made has moved too strongly in my favor not allowing me to get any kind of size down. Today, I got all of 10 puts sold. Total is probably closer to 100 over the different strikes and expiration dates.
Jon
OT OT NUAN is the maker of that software. I bought some years ago and never used it - newer stuff supposedly much better.
Jon
PS NUAN on a tear - $3 B valuation.
Those are likely simply feeder funds into the main hedge fund on which the sponsors get to charge another fee.
Jon
As an option player the late June date is interesting as it means one might be able to sell vol with no event since June options expire on the 15th. That being said, there has been almost no vol in IDIX options to date (have not looked in past week or so except to almost buy some October 7.50s - which to my chagrin, I did not do). And yes, I was going out as far as October to try and capture the event given what happened in march.
Jon
Dew,
No hassles on the numbers but why 82% and not 81% or 83%? Not being a jerk but trying to understand thought process and your take on why the odds you give.
EDIT - By the way, what happens if they do interact modestly negatively but they still hit 10%?
Jon
Sorry. I clearly cannot post clearly and will stop for now. What I meant was the amount of unused margin equity required to be held in your account to initiate the trade. Some brokerages might require more and the new portfolio margin might improve the number slightly depending on other RPRX positions.
Jon
What does this mean for THRX? Anyone? If I remember, they are testing for both NI and for superiority.
Jon
CAP not a good example but look at the travails of OSCI and their approved for one indication antibiotic.
Jon
SIRT are the red wine guys, right? Not literally, but figuratively.
What a low key offering from hype-minded guys. They had articles everywhere.
Jon
Most of these types of things seem to come later rather than earlier. They said top-line in late June but I would guesstimate July some time. Anyone know what they will actually report - will it be topline PK data only or efficacy data only or both?
Everyone seems to think the 10% is a no-brainer. Anyone have thoughts on price either way? I would guess $5-5.50 if less than 10% and $9-10 if good.
Jon
Thanks IJ.
Jon
No - sorry about that. I mean that they are 40+% out of the money and yet they trade for 3+% of the strike price. That is extremely high. Some bios are higher - think ELN and MNTA and other story stocks - but that number is very, very high. Should probably be closer to a dime and not a quarter.
I would never advocate doing this but one could get a 33% return on equity on this position over 3 months. To sell short those puts (i.e., take a bullish position) would require 75 cents per share or $75 per contract. Your potential return is $25 per contract, or 33%. Your potential risk, however, is much higher at something on order of several hundred dollars if all trials were horrible or if the mkts crashed or some combination thereof - not likely, but still a theoretical possibility.
Jon
As an option guy, I can tell you the mkt has high expectations for key news by August. The August 7.50 puts have substantial value for something so far out of the money. Have not checked today but memory says $0.25 or so.
Jon
What is that?
Jon
Are they thinking Gates or Allen?
Jon
I do wonder why he did not do an issuance comprised of some selling shareholder shares (his) and new shares. That is done all the time. I guess he would have gotten less proceeds if done this way, and if that is the reason he did not do it this way, then he is worse than we think.
And Dew, this does happen all the time and given the massive trading volumes, this could easily have gotten away. The stock would likely have traded several points lower however.
Jon
Please Dew! Now I will have nightmares for weeks! <vbg>
Jon
I was short 12.50 puts on quite a large chunk - they made me sweat the whole day. Wouldn't have minded share delivery but I get to do it all again this way.
Jon
Coming direct this week. Nice data.
Tyzeka data:
Date New Total Baraclude Tot (same week of its launch
Nov 17 2 2 31
Nov 24 5 5 47
Dec 1 15 15 54
Dec 8 29 29 55
Dec 15 31 31 85
Dec 22 30 32 94
Dec 29 43 47 100
Jan 5 22 34 106
Jan 12 38 51 135
Jan 19 38 55 177
Jan 26 41 60 164
Feb 2 52 68 185
Feb 9 55 83 198
Feb 16 51 89 224
Feb 23 59 92 253
Mar 2 69 107 247
Mar 9 59 107 285
Mar 16 54 103 286
Mar 23 55 90 269
Mar 30 87 142 283
Apr 6 82 137 340
Apr 13 61 135 337
Apr 20 76 146 371
Apr 27 80 161 374
May 4 92 188 382
Jon
PS Now up to half of Baraclude at similar point.
Stock should be doing better.
I may buy some more soon.
Wish I had sold some on that earnings day. Ugly action.
Some outfit called Next Generation just upgraded them this morning and Needham reiterated buy on the second. AGE initiated at hold with a lot of info in the same timeframe.
Jon
VVUS The deal they got for EvaMist though did surprise most folks.
Jon
Thanks for the notes. Shortening VX950 to 7-9 weeks seems on the surface to make a lot of sense if followed by 12-24 weeks of SOC. I have seen other commentaries favoring this approach.
It makes me wonder though if the Ph II program was as well-constructed as it could have been.
Jon
PS Hindsight is 20-20.