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If they "dumped" calls on the buyers, why would the ask move up? I would assert that overall options volume relative to the open interest is nothing to get excited about.
For the most part, the purchases were hitting the ASK (from what I observed throughout the day). There was sufficient supply to prevent a price rise. Call writers hit the BID at end of the day at various strikes.
That being said, the option purchases largely appear to have been hitting the ASK. The demand is undoubtedly emanating from call buyers.
Thanks Dew. No real point in speculating, but it is very unusual for a company to make a mid-course correction like this. (Backing out of a prestigious CC and removing the link from their website)
Does anyone know when they removed the link. The google cache snapshot is from 3/10, so it must have happened between 3/10 and yesterday.
It doesn't hurt that MNTA short interest released today (for the period ending 3/15) is at a 12-month low. (http://www.nasdaqtrader.com/Trader.aspx?id=ShortInterest)
I'm hopeful we get word from the FDA this week.
Ouch ... unbelievable.
MNTA: someone wanted into MNTA bad this afternoon in the AH. They spent $166,320 buying 10,800 shares @ 15.40 .... interesting
Dilution is going to happen after the May 3rd settlement ruling. I expect that dilution will be net positive for the stock, as it is a fairly big de-risking event in advance of potential Down Syndrome test commercialization. Look for a rally after dilution.
ARYX: Does anyone think it is a good value play here? Or is it more likely to head to 0.5 - 0.7 on the back of dilution (as value investor suggested a few days ago)?
MNTA climbing again.
NVS and SFY are both acting in ways that imply they expect some sort of FDA decision soon. We have a decent chance of a decision within the next 90 days.
SQNM is a good value at these levels (IMHO).
Dew, what you do think MNTA would be worth to NVS today (with mL approval pending)? Notwithstanding your excellent point about the Alcon deal needing to take place, I would be interested to know...
Wow .... I can't imagine that NVS would consider acquiring MNTA until after the FDA makes a formal decision on the mL ANDA. It might be a great (and mutually beneficial) acquisition in a multi-generic mL approval scenario.
Dew, your thoughts on this?
MNTA - Two Articles I Consider Extremely Bullish for Imminent Approval of mL.
DAVOS-Sanofi CEO says braced for generic Lovenox
Wed, Jan 27 2010
* Lovenox not part of the future at French drugmaker
* Sanofi will be "extremely vigilant" on generic safety
* CEO says not interested in Germany's Ratiopharm
By Ben Hirschler
DAVOS, Switzerland, Jan 27 (Reuters) - Sanofi-Aventis <SASY.PA> is already anticipating the arrival of generic forms of its blockbuster anticoagulant Lovenox and doesn't view the drug as part of the company's future, its CEO said on Wednesday.
The French group's rival Novartis <NOVN.VX> hopes to win U.S. approval soon for its copy of Lovenox and worries about an imminent launch have knocked Sanofi shares in recent days.
"It will have a hit on sales but for us it (Lovenox) is not a growth platform for the future," Chris Viehbacher told Reuters on the sidelines of the World Economic Forum.
"Lovenox isn't part of the future of the company ... and we essentially built into our 2013 guidance the appearance of a non-substitutable generic. If there weren't a generic for Lovenox it would be an upside for the business."
There has been mounting speculation in the past week that Novartis's generics unit Sandoz and its partner Momenta Pharmaceuticals <MNTA.O> are gearing up to launch a generic form of the drug, which sells some $4 billion a year worldwide.
Along with Novartis/Momenta, others seeking approval for a generic Lovenox include Teva Pharmaceutical Industries <TEVA.TA> and a partnership of Watson Pharmaceuticals <WPI.N> and privately held Amphastar Pharmaceuticals.
Lovenox is a complex biological drug and Viehbacher said authorities would have to look long and hard to ensure any copy delivered the same safety and efficacy as the original.
"We are certainly going to be extremely vigilant on all the safety issues," he said.
UPDATE 2-Novartis says on track with generic Lovenox
Fri, Jan 22 2010
* Swiss group says has resolved issues faced in past
* Aims to launch generic as soon as gets FDA approval
* Sanofi shares down 1.5 percent
* Momenta shares rise 13.3 percent
(Adds Momenta shares, analyst comments)
LONDON, Jan 22 (Reuters) - Switzerland's Novartis AG <NOVN.VX> said on Friday it was making progress with a generic copy of Sanofi-Aventis SA's <SASY.PA> blockbuster anti-clotting drug, Lovenox, after an analyst said Novartis was gearing up to launch its version.
The shares of Novartis partner Momenta Pharmaceuticals Inc <MNTA.O> soared more than 13 percent.
"We aspire to launch as soon as we get FDA (U.S. Food and Drug Administration) approval. We believe we have satisfactorily resolved each of the specific issues we've faced in the past," spokesman Eric Althoff said in response to a report that a launch could be imminent.
Sanofi shares fell 1.1 percent in Paris on concerns about future sales of its key drug, after broker Sanford Bernstein said U.S. approval for a generic version of the $4 billion-a-year product may be close. Novartis shares were up 0.1 percent.
Bernstein said it had learned that Novartis' generic Sandoz division was setting prices and soliciting pre-orders from U.S. purchasers for its generic form of Lovenox, or enoxaparin.
"This covert action suggests Novartis believes approval of its generic might finally be nearing," analyst Tim Anderson said in a note.
About 60 percent of Lovenox sales come from the United States, Anderson said.
"It has long been uncertain whether or when generics to Lovenox might get approved and, just because Novartis is doing this, does not mean they have certain approval," Anderson said. "It would, however, suggest that the odds of approvability are rising."
Anderson's note and Novartis' subsequent comments were driving Momenta stock higher on hopes the approval of generic Lovenox was imminent, said Canaccord Adams analyst Ritu Baral.
The drug would be Momenta's first marketed product, said Baral, who has expected a first-quarter approval.
Along with Novartis/Momenta, others seeking approval for a generic Lovenox include Teva Pharmaceutical Industries Ltd <TEVA.TA> and a partnership of Watson Pharmaceuticals Inc <WPI.N> and privately held Amphastar Pharmaceuticals.
Baral said a contamination controversy a couple of years ago over heparin, a material used in producing enoxaparin, led to considerable delays in the companies winning approval for generic Lovenox.
"That's why this has been a rather epic saga," Baral said.
In a perfect world, responsible leadership (officers & directors) would be cognizant of the inference that large stock sales ahead of key milestones has on investors, and would take steps to ameliorate the likelihood that the wrong message is being sent.
MNTA insiders have been big sellers of stock since the co. went public. (they love their 10-b-5 plans) In fact, there were even significant sales of stock by some high-up execs in the single digits. (give aways) That being said, the directors/officers are still all big holders -- I don't think that these sales speak one way or another to their "optimism" for approval.
Thanks for posting RockRat. I too am a holder of LEAPS and some September calls. I expect the stock to do nicely in any approval scenario, trading well above $30 per share. That should make most of the longs here happy (for the time being).
The FDA is under pressure to approve mL by some big generic advocates, so I think they will do so, sooner rather than later. (w/in 30 days)
Who is to say that the FDA would immediately share their concerns with MNTA or NVS? Don't forget that politics play a part*, but politics is oft wrapped in a facade of fact.
Disclaimer: I am still very long MNTA.
* = (Craig Wheeler - Cowen Conference comment re: FDA politics)
I see your point.
But there is enough noise and garbage out there, not to have to parse through and rebut a well-known charlatans assertions. Better to due your own "DEW DILIGENCE."
AF is the king of manipulation. He deliberately leaves out material information in his pieces, when they don't suit his "theories." If you want me to cite to specific articles, I can do so. Take a look at his piece today on SQNM -- irrespective of what you think about the company, for him to cite to another bearish EDITORIAL is weak and deceptive journalism.
I won't begin to touch all the assumptions that compromise this "analysis." But it is amusing.
the stock is up 20% because the FDA accepted the name "exelbine" ... interesting.
Thanks for pointing that out DD.
That being said, calling out the FDA in public does not necessarily buy goodwill from the agency. However, I do agree with CW, and am a firm believer that in life, it is sometimes necessary to call "a spade" when you see it.
Great post RockRat.
The anecdotal sentiment seems to overlay nicely over the near-term (bullish) & intermediate term (bearish) option speculation you point out.
Craig Wheeler has come out and stated that he is optimistic of near term approval, but that further delay would give him pause. He has openly asserted* that failure on the part of the agency to approve in the near-term, would lead him to believe that the delay was purely political. That is a pretty ballsy statement to make to the FDA ahead of a decision... I suspect he chose those words intentionally in an attempt to call out the Food & Drug Administration leadership.
That being said, if approval does not come in the near-term, it likely signals that the mL dream will continue to be deferred and MNTA will continue to live in decision purgatory until some external influence exerts pressure on the unaccountable technocrats in Washington.
* Cowen Conference Call - 3/10/2009
Motionman is right ... technically speaking, we are one day closer to possible approval ... whether that approval happens tomorrow or 2020 is anyones guess. But that being said, this is indeed the closest they've come (thus far) to possible approval. :)
DD I don't think anyone on this board would disagree with your assertion. That being said, assuming that the TEVA (and Amphastar) application is rejected and MNTA's app. is approved, is it really likely that MNTA stock would triple or quadruple overnight (I think your valuation had it as high as ~85$ per share). I've never seen anything like that, and not sure it would/could happen.
I do think it could double overnight and then make a gradual run to the high 60's.
That being said, I agree with ex, I suspect that the stock will do quite nicely EVEN in a multi-generic approval scenario. 35-40.
P.S. I don't think I've seen you attempt to value the co. in a multi-generic approval scenario.
Warning: This post is full of optimism/hope/speculation ...
MNTA mL sole generic approval scenario?
Is it in the realm of possibility, that MNTA's stock move into the $55-$75 range OVERNIGHT if the FDA explicitly approves mL as the sole generic?
I have never seen a company with a 600 million $ market cap triple or quadruple in value OVERNIGHT. Is it more likely that upon approval, the stock would steadily climb to the 50$-75$ range
P.S. volume seems to have finally increased.
The MNTA calls are super pricey. Yikes... In the last 2 weeks the ask has skyrocketed for all the calls, including the LEAPS. (i think some of the LEAP ask prices have doubled).
MNTA - Craig Wheeler (Cowen Conference this morning):
"I am impatiently optimistic that we will be approved soon (for mL)"
"Some parts of agency were as frustrated as us that MNTA had to go through immunogenecity review"
- "As we worked through the issue, we received positive feedback
from multiple groups (within the agency)"
"Now the FDA has everything it needs ... someone at the agency has to put the pieces together"
"We are frustratingly dealing with a large beauracracy in Washington"
"(No need for advisory committee at this time) - Signals that we've had are that we've crossed the (technical) hurdles already"
"We and our partner are doing everything in our power to push this process forward - we are highly interested in seeing this approval)"
"The only thing they (FDA) could do to us now would be political (we've been through all the technical issues - supply chain, characterization, immunogenecity)" <<<< WOWSERS
"We have been working with Sandoz to see how much supply we need upon launch"
According to management, approval could come any day now.... Does that mean it is imminent ?? ... not necessarily.
Interesting ....
Care to speculate as to what Craig Wheeler will discuss at the Cowen presentation tomorrow morning? I'm betting it is the FDA sole generic approval of MNTA's mL .... :)
Dew,
Thanks as always for sharing your depth of knowledge with the board....
How do you think the market would respond to MNTA, if the FDA started rejecting competitor applications for mL (but kept Momenta in the dark about approval of its version of mL)? Would this be seen largely as a positive, or a negative? The likelihood of a sole generic would obviously improve, but the overall likelihood of approval may diminish...
My apologies, President & COO of Amgen (not CEO). Thank you for the correction.
I encourage you to read the docs...
Charles Cantor is still with SQNM (he never left) ... http://www.sequenom.com/About-Us/Leadership-Team/Charles-Cantor
Dennis Lo maintains his relationship with the Company.
I agree that SQNM could have (and should have) been more transparent with respect to "what happened."
That being said, the settlement agreement provides great insight to some of the "problems" the investigation revealed. I would encourage those interested to read it.
(for what its worth, it should also be noted that the independent investigation revealed no "fraud")
Charles Cantor and Dennis Lo are the real "science" behind the DS test.
Thanks for the feedback.
Harry Hixson, the acting (interim) CEO was the chairman of the board when the debacle befell SQNM. He took over after the company ousted some key executive leadership. That being said, his credentials are quite impressive -- he was the former Chairman & Chief Executive Officer of Amgen.
One important consideration in speculating about what exactly transpired at SQNM ahead of the debacle was taking note of the massive short position that had been building. This short position was huge and built in the face of the data that turned out to be "mishandled." Would it be too much of a stretch to imagine a few key employees "coming clean" to management about inadequate policies & procedures one month before DS commercialization (i.e. compromising the integrity of the test data), thus de-railing the launch and throwing the co. and stock price into a near death spiral.
I expect third-party validation studies and/or a partnership will help alleviate the "reputation" damage stemming from the mishandling. I suspect that at the end of the day, the broo-hahah was the result of employee sloppiness; not unsound science or fraud.
SQNM hot and heavy action in the pre-market. Price target raised to $16 @ Cantor Fitzgerald...
Cantor Fitzgerald upgraded Sequenom after meeting with the company's management, as the firm thinks that the development of the company's molecular diagnostics portfolio is back on track. The firm thinks the company's pipeline appears to be progressing and it set a $16 target. :theflyonthewall.com