Assembling my biofolio...
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Dew, iwfal, or others:
I didn't realize when I first posted about this that Oncogenex is publicly traded (OGXI). I think a really interesting question, given OGXI's tiny market cap of $25 million and the trial results, is whether or not OGXI warrants further scrutiny as a possible investment.
They are going to need to raise cash via partnership to further develop OGX-011 but, given how good these results appear, I would think that's quite possible/probable. There's always the possibility of a buyout from someone as well.
Any thoughts?
Thanks.
Thanks for the response. Rigel claims, as noted in the first article, that some of the side effects may be attributable to methotrexate, which many of the RA patients were on at the same time they took RIGL's drug. I wonder how plausible that is and also wonder to what extent any of the actual efficacy results can be attributed to methotrexate and not to RIGL's drug.
Feuerstein (Street.com) should have a field day with this one as he believes they are a fraud as well. I've never followed INGN very closely so I don't know what all the negative buzz is about.
Is RIGL significantly undervalued?
The stock is down from $25 at the end of September to $6 and change right now (about $250 million market cap) over concerns about the safety, though apparently not the efficacy, of its oral RA candidate. Obviously the RA market is huge and an oral drug should bring in big money.
Do the side effects noted in the following article really warrant the kind of selloff the stock has experienced? http://www.forbes.com/2007/12/13/rigel-pharmaceuticals-closer-markets-equity-cx_ml_1213markets36.html?partner=yahootix
There's also a discussion in the following article about the rise in blood pressure but the author attempts to ease those concerns. http://seekingalpha.com/article/103172-rigel-s-punishment-may-prove-short-sighted
Any guesses on the potential annual sales for this drug if it were to make it to market down the road? I believe I read that ISIS will get royalties of between 5 - 7.5% of sales for the drug so it will need to be a good one to add any significant value to ISIS I would suspect.
At least in the near-term, the value for ISIS is going to be tied strongly to the success or failure of Mipomersen. I read enough before about that drug to give me pause but I need to revisit those articles. Longer term, I like Isis. Here is an interesting article speculating on the potential of a buyout: http://seekingalpha.com/article/102575-pfizer-needs-isis-more-than-isis-needs-pfizer
Good to see this after the Euro trial didn't look so good for Dacogen compared to Vidaza. I'm high on SUPG (who gets royalties on sales of Dacogen) but want to wait to see what this quarter's Dacogen sales look like to see if the Euro trial has caused any further erosion in Dacogen sales.
Regardless, the fact that SUPG gets at least 20% in royalties on the drug is a great thing for a tiny biotech (about $100 million market cap) like SUPG, especially in this market. And hopefully this new trial will cast a better light on Dacogen.
Isis & Oncogenex announce positive phase II results for prostate cancer drug
http://biz.yahoo.com/prnews/081203/law039.html?.v=101
Isis isn't necessarily cheap at a $1 billion market cap but then again, given their number of products under development, partnerships, and patent estate, perhaps it is.
Does a $500 million market cap for this company seem reasonable? I'll admit I've never followed this one too close but I've seen similar or even deeper pipelines in much cheaper biotechs.
Fair enough Dew. There is certainly the bias to do just that.
Thanks for the info. I see where a prior release contains a similar opinion as well from the principal investigator of one of the trials:
http://biz.yahoo.com/prnews/081027/aqm054.html?.v=59
Specifically, "[w]hen compared to other commercially available drugs that are used in the platinum-resistant setting, voreloxin has a similar response rate and a reasonable toxicity profile."
Perhaps the toxicity is better than approved drugs but I don't think that's clear at this point.
Are you saying it's more of a "me-too" drug that may be unable to differentiate itself from approved drugs or those under development?
I believe SNSS claims the drug (Voreloxin) is a first-in class, novel naphthyridine analog (related to quinolones). Voreloxin at least appears to be an active drug and the market cap for the company is under $15 million and I do hold it, so that's why the interest from me.
Thanks
Thoughts on Sunesis (SNSS) and its lead drug
I'm well underwater in my investments in SNSS and I'm just looking for further opinions on the company and its lead drug to determine if I should just let my existing holdings play out or add to it at these extremely depressed prices ($15 million market cap). Any thoughts are appreciated.
I was first attracted to SNSS because it looked like they had a fairly deep pipeline for such a small company along with several partnerships. Their lead drug, which is not partnered, is in Phase II trials for platinum-resistant ovarian cancer and Phase I for advanced leukemias. They have other compounds in development but they're pretty much focused on this one since cash is running out.
The results so far appear to be pretty good but I'm open to further opinions: http://biz.yahoo.com/prnews/081106/neth060.html?.v=68
As you can see, in the Phase 1b/2 trial for AML patients in combination with cytarabine, there were several remissions but I guess it's unclear if that is related to SNSS' drug or cytarabine. In the Phase 2 against platinum-resistant ovarian cancer as a single agent at the highest dose in 32 patients, there was 1 complete response, 2 partial responses, and 20 patients achieving stable disease so far.
How do you all view these results and how likely would it be for the company to attract a partner given these results?
http://www.google.com/hostednews/afp/article/ALeqM5gCxcvWTgYtaUQbGnYfvl8dEWrsRw
If you believe that article regarding the threat of a biological attack, then I think the stock certainly does hold even more upside. That said, the company now has a $700 million market cap and the stock trades near a 52-week high. I'm just not big on investing in companies trading at or near a 52-week high as so much can go wrong.
As the article states, the company primarily relies on the government for its revenue and relying on any one customer is risky. What if its next-generation anthrax vaccine doesn't live up to its promise and the government looks elsewhere? There's just too many questions for me to want to invest in it.
My worst move was backing out at the last minute on investing in MEMY just a few days before it got bought out by Roche for 4 times the price. I'm hoping ACHN makes up for that.
Biotechs, and in particular the smaller biotechs that I tend to focus on, clearly do have risks that you point out such as potential regulatory delays, safety, competition, etc. No question about that. For the smaller ones, you also have to add financing risk as a lot are experiencing a cash crunch.
However, IMHO, I think it's the smaller biotechs that have really been beaten down during this downturn and offer a lot of upside at these levels with reasonable risk/reward. I think you're referring to the larger biotechs (e.g. Genentech, Amgen, etc.) in terms of those keeping their "heads above water." My small cap positions have really been slaughtered of late. There are so many names I'd like to invest in but I just don't have the funds so I have to be very selective. If you focus on quality names that have deep pipelines, good partnerships, ample cash, and, perhaps most importantly, diversify, I think it's a good time to be in small-cap biotech as long as you're selective and do your homework.
mcbio just did as well! I'm anxious to see what happens to the stock in 2009. This is one I believe in for the longer term so if we do experience any setbacks, I'll likely buy more.
Thanks, that's helpful. So Teva responded to the same question that MNTA/Sandoz did but that doesn't necessarily equate to the FDA viewing both generics as equal.
Regarding Sanofi's potential "authorized" generic, is the belief that they likely won't introduce one due to the fact that any introduction by them essentially cannibalizes sales of Lovenox? I.e., why would someone use Lovenox if the same company that makes it has its own generic? Rather, by not issuing their own "authorized" generic perhaps they hope there will be those who question if the generics truly are equal to Lovenox. Is that the rationale?
Although it would be nice to have the only generic, as long as MNTA at least gets approval in 2009 we should be looking at a much higher price, which makes me like the risk/reward.
Question RE MNTA generic competition
Dew or others:
Are the FDA decisions for Teva, Amphastar, and MNTA's generic drugs for Lovenox all mutually exclusive in terms of timing or are the decisions expected to be known around the same time for all three? If mutually exclusive, which company is first expected to get an FDA decision and is there any idea of timing in 2009?
Also, in the ReadMeFirst, there is discussion that Craig Wheeler believes that Amphastar is not close to approval for their generic. Are Teva and Amphastar two separate competitors or just one joint entity? If they're separate, what do we know about Teva's generic and any reasons why it would be unlikely to receive approval?
No, not DCF because I know profits are years down the road, if they do come at all. I think a combination of a general market rebound and GERN finally getting its stem cell product in the clinic will create a bit of a buzz and get this stock moving. Of course, we don't know when the FDA will lift its hold on the product. I never really had too much excitement about the telomerase products for cancer.
Notwithstanding my position, I will say that GERN probably is one of the least favorites of my holdings or the biotechs I plan to invest in soon just because there are a lot of questions.
Dew,
Who is the competition and are they publicly traded? It sounds like a promising area of research so I'm open to digging into this a little more.
I'm just saying that even without a buyout that I think the stock will go a good deal higher from current levels. And if a buyout offer comes along down the road, even better. Betting on buyouts can be hazardous for sure but I'm willing to take profits should this one rebound like I eventually expect it to.
Micro,
I respect the opinion and commentary on GERN but I guess we'll have to agree to disagree on this one. The market didn't seem to have much concern with the announcement either as the stock actually closed up on Friday.
My investment rationale for GERN hinges not on GERN curing cancer or repairing spinal cord injuries in the next few years (or ever necessarily for that matter) but rather on the fact that you're dealing with what is arguably one of the leaders in embryonic stem cell research among the publicly traded biotechs. And I don't believe GERN needs to get any drugs on the market for this stock to go higher from current levels given their position as one of the dominant players in a promising field.
Amorfix
I only heard of this company because I track BiogenIdec and they are apparently in the early stages of working with Amorfix. Any thoughts on this release regarding Amorfix's work with monoclonal antibodies?
http://biz.yahoo.com/cnw/081020/amorfix_dse_improvemt.html?.v=1
Amorfix is a little too small for my taste and it only trades on the Toronto Stock Exchange. I might be more interested if BiogenIdec ultimately does license the technology and make a large investment.
I believe his model portfolio holds IMGN as well, and that's my largest holding.
I think he relies a lot on his industry contacts to give him info. He doesn't give a lot of detailed scientific information but more of a layman's description of a given stock, the company's drug, and the investment thesis. I appreciate that just because I'm no scientist or doctor. I could see how others who are might appreciate more of a specific scientific discussion though.
Thanks, I hadn't heard of this one before. I e-mailed them to get more info on price and if they do any free trials.
Good job on the low cost-basis. You're in pretty good shape for 2009 if the news flow is positive. If it is, your decision to hold on will probably look wise.
It's always tough to figure out when to sell. If I have a loser and the story has changed from why I originally invested, I have no problem selling. I have more trouble when trying to figure out when to sell winners.
I was fortunate enough to be in RIGL at cost basis around $9 when they announced positive (at least at that time) Phase II results for their oral RA drug. The stock shot from around my cost basis to about $25 and I decided to take the profit. If I get a quick triple, I'm usually apt to sell just because these biotechs ebb and flow so much. Now, the stock is back below $10, even though to me the story is still largely intact.
Biotech Newsletters/other sources
Are there any biotech newsletters out there that any of you use or otherwise recommend? Also, where do you primarily get your
investment ideas from?
I track roughly 150 biotech/drug stocks on Yahoo Finance and I try to read the related articles for a lot of those companies daily. I've got pretty much all of big pharma on that list so occasionally they'll add a partnership with someone I've never heard of and I'll add that name to my list.
I have come to like the biotech articles posted by Seeking Alpha and Adam Feuerstein (TheStreet.com). I know Adam has his own newsletter now but I don't know if it's worth the cost. I've heard of MTSL but I believe they have a pretty poor track record and I just remember getting a sample issue from them years ago and they had all of these crazy target prices for most of the companies with not a lot of discussion on each stock. Perhaps that has changed, though. I did Sturza's newsletter for awhile too but I don't know if that one is still around and, if so, I don't know the track record as I didn't use it for very long.
Thanks for the welcome! Happy thanksgiving to you and everyone else on here. This is a cool site. I wish I'd found this a long time ago as I've been investing in biotechs for years.
I'm going to read MNTA's latest 10-Q to get a better feel for this company but I like everything I've read so far. Do you have any idea what the exact royalty will be for MNTA on sales of generic Lovenox if there are multiple generic competitors? I'd assume it's still a double-digit royalty.
Is MNTA your favorite biotech stock right now Dew?
GERN's response:
http://biz.yahoo.com/bw/081127/20081127005363.html?.v=1
I don't think this decision is as bad for GERN as it seems at first blush after reading the above release (granted, it's from GERN). If the stock should experience any further weakness, I'll probably just dollar cost average some more into my position.
First look at MNTA
First, awesome summary Dew on MNTA at the top of this page. There's tons of good analysis there for someone like myself who is a newcomer to MNTA. I'd heard the name before but for whatever reason never decided to take a closer look at it as an investment.
It looks like the predominant opinion on here is that the FDA will approve its generic Lovenox in early 2009. If so, that will be big not only because there should be significant cash coming in shortly thereafter, but perhaps equally important that the approval validates MNTA's approach and the rest of its pipeline. But then, MNTA's not just about follow-on biologics, as they have M118 as well. I like the story and the risk/reward level here and may establish a small position. I think this is one of those biotechs where you won't need a huge position if MNTA reaches its full potential. I also like the fact that it will add some diversity to my biotech portfolio since I'm now heavily weighted in cancer-focused companies.
What about BioCryst Dew? What are your thoughts on peramivir?
Supergen - Thoughts on PIM Kinase Inhibitor and Stock In General
Supergen claims that its drug, SGI-1776, which is about to enter Phase I, is the first PIM kinase inhibitor in clincal trials. The drug targets cancer. Does anyone know if that is in fact true and how does a PIM kinase inhibitor compare and stack up to a tyrosine kinase inhibitor? If this truly is the first, you would think this would draw some interest down the road wouldn't you?
Any other thoughts on the rest of their pipeline or the market cap (around $100 million)? They've already got Dacogen on the market, which generates revenue to finance the pipeline.