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I don't expect we'll ever see SA data. The fact that the ad seeking subjects is still up suggests that enrollment is still ongoing. They're going to run out of time and money before this study can be completed.
I think we're done. This company will be bought, or the IP will be liquidated. I don't expect a partnership; if there were a counterparty, we'd already have the deal. However painful it will be for those of us who are under water here, I think this is the best we can hope for (based on Dew's numbers the 90% bump may be high, since the data were skewed because of outliers on the high end). I dread a biotech alamo, which would leave retail investors with nothing.
The SHM should be interesting.
Parexel handled RD-2. If the advertisement mentioned in post 26264 is related to cor's SA trial, and is recent, we're definitely looking at some date slippage.
This is blood under the bridge, but since we may be in the process of moving from investors to undertakers, these are key decisions that to my mind stand as examples of errors in judgement on the part of cor management. You've addressed all this ad nauseam, so I apologize in advance.
1. From a strategic standpoint, leaving aside zebra's law, why did they bring before the FDA a new compound to treat a non-life-threatening condition in a juvenile population, for which other drugs already existed (ADHD)?
2. Once the hold was applied, the consultants they hired to chaperone their petition to the FDA must have known that the bar was going to be set very, very high. Why didn't they cut bait rather than squander resources and time resubmitting a tainted molecule nearing the end of its patent life? The other low-impacts were already getting closer to the clinic, and the collaboration with Greer was already underway (I know this: in October 2007 I asked about whether ampakines had been tried in the treatment of Rett's Syndrome at a scientific conference Greer and I were both attending. He chased me down after the session to quiz me about how I had come upon ampakines, and when I told him, he explained that he had begun working with cor. He provided no details, and I didn't ask).
3. More generally, I feel that the indication-based outlicencing strategy is no longer viable (upfronts are too small, buyouts are more attractive to BPs), and I am not convinced that cor management has abandoned this approach.
Anyway, the hell with all this. There are roughly 130 microcaps in the same situation as cor (as per tonyavw's post msg# 26164). My guess is that all of these companies are looking to partner, and most will fail to do so. I have to think that cor has some of the best IP in this cohort, and the overall situation of BPs has to motivate them to in-licence compounds, so there is reason for hope. If cor is able to make a deal and survive this brutal period, the environment it will find itself in after the microcap biotech die-off will perhaps be more favorable, since there will be fewer microcaps competing for partnerships.
I continue to have some cognitive dissonance about that whole affair. Stoll got up at the 2007 spring SHM and stated that the problems with cx-717 were due to a post-mortem artefact, and that they had nailed it (I remember that he mentioned that 8 ft of documentation were being sent to the FDA to support this claim). So first off, cor did respond to the FDA to get the hold lifted.
The problem is, despite what they told us, whatever was in the 8' box, it was deemed insufficient. I got a bad feeling about the integrity of the company's management about the way the whole thing was handled: the application was withdrawn without comment after a phone-call on the very last day of the review process.
If cor really had full confidence in the incontrovertible evidence of what was in the 8' box, it seems unfathomable that they just rolled over like that. You mentioned at the time that it is not at all uncommon for the applicant and the FDA to go back and forth, clarifying issues and defending their arguments, so there should have been a mechanism short of outright defiance for cor to put up more of a fight. They didn't. "Discretion is the better part of valour" was the explanation offered, but when you look at the history of this company since then, it has been one of precipitous decline, despite good trial results.
We don't know what would have happened if they had pushed back, but my sense is that cor management overstated the quality of the data in the 8' box, which is why they rolled over. Regardless of whether that is true or not, I think that cor has stagnated on good news, and drifted down on no news because the company's credibility was compromised. Standing by what you claim to be true may in the end be more important than avoiding conflict with the FDA. The most charitable thing I can say about cor management is that they mishandled that situation.
I think the bottom is at $0.17, barring another round of dilutive financing. I don't understand why people are so interested in getting the exact bottom here, since it likely will go up from these values even if it dips below. The price appears to be driven down by the heavy volume of selling, and much of these shares probably come from the institutional investor that financed cor at $0.17 / share. Based on the number of shares already sold, share-price should begin drifting up again. I think the PIPE and the delisting have been priced in.
I'm not convinced that the sell-off is accounted for by the delisting only. Given the share-price, the delisting would be seen as a non-event by anybody familiar with penny stocks. Further, news of delisting was available since friday, yet the share-price held until the afternoon, and then the bottom dropped out. Maybe one seller set off an avalanche, with nothing else behind it. At this juncture though, I'm surprised that there are still weak hands holding shares in this stock. My concern is that there's news behind it. We'll see. This is the second heavy volume day that doesn't make a whole lot of sense.
I think that what's happening to cor is analogous to what happens to foreclosed houses. The owner is forced to leave, thieves move in and strip the wiring and plumbing for the copper. For the sake of a few dollars, a house is rendered worthless, and a neighborhood is blighted.
Every time a microcap closes, the skills and knowledge of that team is lost. A few patents are scooped up, and on to the next. As a consequence the most vital element in the biotech sector is destroyed, and with it, US leadership in one of the few sectors where we could still hope to be competitive.
I don't think we're going to see a partnership, just liquidation at fractions of pennies on the dollar for what the IP is worth. Worse still, the promise of these drugs may vanish into the bowels of BP bureaucracy.
In the fable of pandora, a box containing all the evils of the world was opened, and all but the greatest evil was loosed on the world. The ensuing suffering was so great that the last greatest evil was also released to make the whole ordeal bearable. That last, greatest evil was hope.
Being hopeful about cor is bad for your mental health, and has no support from events over the last few years. I am watching this whole thing and trying to learn something from it, at great cost.
Why are you assuming a sugar daddy? Somebody may be positioning themselves to do a hit-and-run double by liquidating the IP.
Based on the IP, this company is massively undervalued. In this circumstance the lowest-risk approach is to gain control of the company and liquidate the IP for a quick double from $0.30. That way, there is no waiting for an eventual payday contingent on the FDA playing ball, good efficacy, and competitors remaining unable to come up with something better.
I'm not ruling out a sugar daddy, but I don't have a very good feeling about the institutional investor who bought that huge bolus of shares 2 weeks ago.
The only thing in cor's favor is that all of them are aware of the downside of seeing cor's IP go to one of the others. Even if cor is killed, someone will get the carcass.
Given the relatively small size of the deal, and the fact that they can't control the pace of the process (since cor doesn't have the funds to continue operation, and doesn't have any very viable options to raise more funds), isn't it possible for the BPs to act more quickly than normal?
>> Some are for small premiums to the market, some for surprisingly large premiums to market cap.
It might be that the difference between these two groups is that in the absence (in the first instance) or presence of competing offers.
>> That is where we are heading, one way or another: a buyout.
I don't know how you can say that. Every time you, me, or anybody else has made predictions about what would happen with cor(with the very rare exception), we've been wrong.
A necessarily incomplete list of outcomes is:
1. a SA / RD outlicencing
2. a low-impact outlicencing
3. a buyout
4. liquidation of the company's IP via a proxy battle.
I bet that what ends up happening isn't on this list.
That's very useful information. Delisting isn't all that rare, and it isn't a very good predictor of a company's survival. I hope you're right about the partnership and SA timelines.
It's not a matter of freaking out. We are operating on very little information here, and delisting is new information. My question is, if we look at this as actuaries, what are the medium-term outcomes of companies that undergo delisting? Every case is different obviously, but if only 5% of companies threatened with delisting are in business 3 years later, that is informative. We're so close to this company that we tend to believe that things are different when it comes to cor. Getting some statistics on delisted companies is a way of estimating what the outcome is going to be assuming that cor is no different from the other companies that went through this.
A related question is: how many other microcaps have gotten / will get this letter during this lousy period?
There must be numbers on what how many companies threatened with delisting are around 1 year after such a letter is sent. Does anyone have comps for this kind of an event?
Is this a low- or a high-impact?
Aiming, I agree whole-heartedly with your position. Thanks for maintaining a space where ideas and information can be exchanged.
It occurred to me that in the event of an ampakine coming to market for SA, off-label use would go through the roof. Assuming that the drug brought to market is simply a low-impact ampakine, once it starts being prescribed for SA, users will discover that it improves cognitive performance, permits a higher level of functioning under conditions of sleep deprivation, etc., and will begin taking it for things other than SA. Because of the ubiquity of SA, it won't be hard to convince a doctor to write a prescription, and in addition, doctors themselves may start using the drug in an off-label context.
On one hand, this means that if a BP is successful in bringing the drug to market, the profits could be larger than SA-driven estimates would indicate. On the other hand, the risk of off-label use may subject the drug to more scrutiny than normal (I'm sure that it's not part of the FDA's mission to concern itself with off-label use, but in this context, I think it would have to be an implicit factor).
My implicit point was, loosing weight and getting in shape is the easiest and best solution, because it makes sleeping on one's side an option.
OT I wonder whether obesity, which is implicated in airway collapse and hence SA, might also make sleeping on one's side uncomfortable, because of the weight borne by one shoulder or the other. There are probably a fair number of people who are thin but just don't like sleeping on their backs, and they might benefit from the tennis-ball idea, but if your weight makes sleeping on your side painful, then putting tennis balls on your back now gives you 2 choices of how to have a lousy night's sleep.
I agree with everything you say, and I hope I am wrong and you guys are right. It would be great to alleviate this major health problem and make money doing so.
It's not patient-to-patient variability, but night-to-night variability in any given patient, that worries me.
Sleep can, among other things, be considered a homeostatic/allostatic process, embedded in feedback loops. Ampakines will be changing slow feedback to this system, and I think the response will be complicated, because of nonspecific ampakine effects.
athero, Neuro,
My thinking on this is quite simple-minded, and has nothing to do with the ampakine half-life, or the likelihood of SA on the second night.
Going into the first night, the subjects are very sleep-deprived. Because of the ampakines, they have the first good night's sleep in a while, and awake rested the next day. If they were to take ampakines again, the ampakine's known effect of decreasing sleepiness, together with the fact that the subjects were rested, would perhaps make falling asleep less likely.
My problem with ampakines for SA is not the A part, it's the S part. As sleep-debt is paid off, the arousing effects of ampakines may be increasingly problematical.
see #25828
Based on the nature of the trial, the entity carrying it out, and the size of that market, the ADHD result may be more important than the SA trial for cor's future. Clear data in this trial will motivate Schering to do a deal, regardless of the complications associated with the Merck merger. Cor is at a point where it has to do a deal with someone, Schering knows it, and any counterparty knows of Schering's interest as well.
The flip-side to this is that so-so or negative ADHD results would greatly weaken cor's bargaining position, since Merck/Schering is a credible counterparty for a deal of any scale involving cor. In the absence of Schering as a suitor, others may be more willing to risk waiting for a better deal with a weakened company.
Given that SA leads to chronic sleep deprivation, and that ampakines reverse sleepiness, I would be more interested in the second night on ampakines than the first.
Good data would be nice, but could complicate negotiations, since the size of the market is huge, and the uncertainty of the drug's usefulness would remain large. This might lead to a mismatch in the perceived value of the IP between the negotiating parties.
I like RD because the preliminary data were obtained in a context that was clinically much less ambiguous: respiration was upregulated, and analgesia was preserved. In the context in which the drug would be used, that's pretty much all that needs to be known.
Finally, because I don't think we're going to see an indication-based out-licencing, I just don't think that the nature of the deal that we'll eventually see will be that sensitive to the SA results.
I think you're overestimating the importance of SA results. The study design that Neuro described is weak POC: a positive outcome would establish that sleep was maintained and ventilation improved for 1 night in maybe a dozen people. Very weak beer. That might sweeten the deal for cor, but I don't think it's decisive one way or other.
When are the ADHD data coming out? That has to be a more robust study.
I'm glad you're in. You've followed this stock for so long that it would be a shame if you failed to cash in at the end. I think your estimation of the risks are accurate. Let's hope we move up from here.
I've been advocating an out-licencing of the whole low-impact platform for months now, because:
1. If cor does an out-licencing for a given indication using a given low-impact, that deal lowers the value of subsequent indication-based out-licencings because of the risk of off-label use of the first out-licenced ampakine.
2. Cor can't nickel-and-dime their way out of the hole they are in. They need to have 2 years' operating funds on hand. Indication-based out-licencing deals will generate this kind of money only in the very rosiest of scenarios. Further, the terms of a broad deal would lock in a portion of the profits generated by their molecules once they reach the clinic, establishing a source of revenue.
3. Given the size of the company, they cannot adequately pursue both the low- and high-impacts. The high-impacts are potentially game-changers, so given the choice of focusing on low- or high-impacts, the high-impact route isn't too bad.
Based on Neuro's description, the issues I raised are moot. Ampakine's ability to reverse SA will be tested for one night only, minimizing the risk of ampakine-induced loss of sleepiness. This makes POC more likely, but also weakens the result.
PS: if you only suffer SA when you lie on your back, why don't you sleep on your side? It looks like SA is another case of a devastating public health problem best addressed by a change in behavior (see obesity, lung cancer, diabetes, heart disease,...).
PPS: by responding to Iggs, we all keep the ball rolling. She's not going to be banned any time soon, but she can be iggnored right now.
Is the SA study over several nights? I suspect the effect of the drug will vary. Someone suffering from SA is chronically sleep-deprived. Assuming the ampakine works for SA (I do), the subject will fall asleep easily (because of sleep deprivation), and will have a night's sleep uniterrupted by SA episodes. The next night, the subject will be more rested, hence may experience more difficulty falling asleep due to the ampakine's sleepiness-reducing effect, changing the duration and perhaps pattern of sleep. Insofar as these slow effects come into play, there will be within-subjects variability as well as between subjects variability.
This may not be an easy dataset to analyze, and is unlikely to produce clear efficacy IMO.
Stepping back, I think cor has the option of liquidating the company or out-licencing the whole low-impact platform -- that's it. SA results will determine the terms of such agreements, but not their overall structure. I think an indication-based parcellation of the low-impact platform will not generate enough money for cor to go forward. If cor is able to find a partner for SA and RD, that partnership will increase the difficulty of a separate ADHD deal, since any company that enters into such a deal, and has to overcome the FDA's stringent ADHD standards, would risk off-label use of the ampakine out-licenced to the RD/SA company. As a consequence, I don't think it makes much sense for cor to continue with the indication-based out-licencing strategy, given that the value of out-licencing the whole low-impact platform may exceed the sum of the individual indication-based out-licencing agreements (assuming they can find partners), because of the risk of off-label use.
All this is based on the assumption that the low-impacts vary in their kinetics, but not in their overall effect. If it turns out that different low-impacts preferentially target distinct AMPAR subtypes, and that these subtypes have at least partially non-overlapping functional roles, then the risk of off-label use diminishes. I think that cor bears the burden of proof to establish constraints on off-label use. Because this is way beyond what cor has the means to do, off-label use persists as an impediment to indication-based out-licencing agreements.
They need to do a simple, big deal, and get it over with.
I think there are ways around this: if the RD drug is only sold in IV form, it won't get much off-label use; likewise, if the SA drug is sold in combination with a hypnotic (to counteract the sleepiness-reducing effect of ampakines), off-label use would also be problematic for anyone but the adventurous recreational user.
Any "naked" low-impact in pill form would be amenable to off-label use across the board, however. This strikes me as a flaw in the indication-based out-licencing strategy that cor is pursuing.
I think that the third option of outlicencing the entire low-impact platform makes a certain amount of sense. With the right partner and terms, it could boost sp into your buyout range, but allow cor to continue as an independent entity, pursuing the high-impacts. If any of the high-impacts reach the clinic, they would be more important than the entire low-impact platform, because of their disease-altering potential.
My concern is that the massive transfer of shares 10 days ago had little to do with supply and demand, and more to do with an agreed-upon transaction, with a buyer supplying a floor to the PIPE shares that were unloaded. I don't think this kind of transaction is executed by parties with a buy-and-hold strategy. I am concerned that we now have a single institutional investor with enough shares to start dictating to cor management.
Given that it's do or die, is the corpse of cor going to sell for $0.10? I'm hoping that if they are forced to liquidate, it will be for more than $0.30, let alone $0.10.
I think that cor is going under. I'm just hoping for a bounce on liquidation. Is this reasonable?
My 2 cents on that is that some of the most prestigious places are so hypercompetitive that there is very little collegiality and exchange of ideas/data/methods. This negatively impacts the quality of the research. My short list would be UCSD, Brandeis, Albert Einstein, but that's basically because of a few exceptional people at each institution, rather than a reflection of the strength of the program.
I completely agree. The trouble is that the scenarios I can come up with for how/why cor is being gamed is a payoff that has little to do with partnerships, FDA approvals or anything else that motivated me and most other retail investors to go long on cor. I think the hedge for this hypothetical buyer is liquidation of the company's IP, and the best upside is a buyout. If there's a proxy-driven liquidation, I expect a payout of ~$0.60/share, whereas if the company is bought, I expect a payout at around $2. I think that what we're seeing here has less to do with Adam Smith, and more to do with the nature channel.
That said, I expect to see shares worth more than they are now when these guys are done with their work. Just not a lot more, and certainly not anywhere near what the IP is actually worth. I bet scstocks is buying for one last ride.
Apples, oranges, and bananas. I wasn't suggesting that cor would fall behind on the projected termination date because of the same problems that plagued RD. Rather, I'm suggesting they will because of some new set of problems. Basically, I think that the mid-09 completion date was based on everything going exactly to plan. My sense is that there are a fair number of moving parts in this kind of a study, and if anything goes wrong, there's slippage.
All this said, I'd be delighted if you were right. To keep my cor-related aggravation levels manageable though, I'll stick with my gloomier view.
Also, how do we know that this time, nobody's got a vacation to screw things up?
Don't hold your breath (bad pun). Based on last year's disastrous delays associated with the RD trials, I am pessimistic about SA data by mid 09. If they have results by September, I'll be very surprised.
Gfp what do you see as the downside risk for getting in at this share-price?
FWIW, selective activation of alpha4beta2 nicotinic receptors upregulates inspiratory amplitude and respiratory frequency in vitro. This might be a "silver bullet" approach to SA, in that it may more selectively target respiratory rhythmogenic neurons than ampakines would (I'm assuming the ampakines being used in the SA study target AMPARs broadly).
A recent paper on this is: Alpha4* nicotinic receptors in preBotzinger complex mediate cholinergic/nicotinic modulation of respiratory rhythm.
Shao XM, Tan W, Xiu J, Puskar N, Fonck C, Lester HA, Feldman JL.
Earlier papers by the same authors showed this without using a knock-in mutant, just selective pharmacology.
For that reason, and the way this stock is being traded, I don't think the spike in volume is due to a leak.
I also don't think that those buying cor are planning on holding it. I think it we are witnessing a speculative and perhaps predatory play.