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For what it's worth....
The sentiment of my technical network (technical as in scientific, not trading) is that interest is rotating back into drugs generally.
This is especially true this morning, due to the total capitulation of the Administration to Big Oil, and the resulting destruction of the bio-based fuels & chemicals investments. Although this area has been out of favor for about 18 months, the announcement today slashing the RFS will likely be the trigger to actively move money out of that sector. The overlap in technology with both biotech and small molecules is sufficiently great that existing diligence and decision-making capabilities can readily be applied to drugs by an investment house looking to move out of the bio-based arena.
Yes - you would think.
The protocols for clinical trials are the product of a major amount of work; review, discussion, re-writing, review, and on and on. The selection of sites, the selection of patients, recording of data, and patient compliance is all part of this - not just dosing the patient. And even if the clinical work is done properly according to the clinical protocol, and the patient complies perfectly, the data still has to be recorded properly. If anything is at variance with the clinical protocol in any respect, then the data collected is suspect.
The practical aspects of running a trial are enormous; this is not just something that is done "on the side" by a doctor. A major cost, and a major practical problem for those companies running trials, is finding medical practitioners who want to do it. Back in the day when I was in BP, recruiting the sites and doctors was a big deal.
So, to your point; you are correct - it should be easy just to get folks to follow the best protocol. But first we all have to find out what that protocol is. Then it is the human problem of getting people to follow directions....
The ASH website notes that "selected late-breaking abstracts" will be available on Nov. 18; these are abstracts that missed the Aug 18 submission deadline. We should all take a look to see what new posters there might be.
Also, the fee for being a guest is only $115, although nothing is said about how much access a guest has to the convention. Anyone have a friend going to ASH?
Is anyone on this board going to ASH? (not me - I am not clinical)
Would love to know what the buzz around the posters will be, and who might be in the crowd!
In a perfect world for the originator company, the rule of thumb is a 95% margin on the bulk API, and 90% on the formulated Drug Product. So for every $1BB in sales, you can spend $50MM making the API and another $50MM formulating it and making the final product (which includes the packaging, e.g. if the drug is provided in pre-filled syringes, vials in shelf-pacs, IV bags, etc etc )
That is for the sales price of the pharma company making the drug. Just to complete the thought, that price can be anywhere from 1/3 to 3/4 the final (i.e., marked-up) price to the patient for prescription drugs that you buy at a pharmacy.
Not sure what the mark-up would be for a cancer patient getting the drug from the dispensary.
A company cannot (legally!) sell a drug in the US that does not have FDA approval. So the only way to keep Iclusig out there is to provide it for free.
I have no knowledge of what might be charged to patients in clinical trials, but if Ariad is providing the drug fro free to others, it seems unethical to charge - or continue charging - any patient in a clinical trial.
While I acknowledge and admire HB's tenacity and agree that it has been a good thing for the company, I have no knowledge of what political - or other - connections HB might have, nor any comment on how he may or may not use them.
Nor do I have any idea of what relevance your second sentence has to any of my posts.
We have several things coming at us before year end.
Tuesday's call should be about finances and plans, as others have posted. Regardless of what it is, there should be a clear plan and a statement about finances for 2014. The plan may have options and multiple choices, but it needs to be clear and fit the finances available for 2014. Some reassurance/clarity on EU status and sales of Iclusig too. That's it.
ASH - the very large conference the week of Dec 7. We have seen the poster abstracts, at least some of them. Squaring what looks like great clinical data in those posters with the current representation of the clinical situation will be what the folks at ASH will be expecting to hear, along with why PACE and EPIC data looked so different. (Remember, PACE was Phase II, EPIC was Phase III. Others may want to post what the difference in arms, dosing and clinical endpoints of those two trials - I don't have that info handy.) Hopefully the poster presentors will be well briefed and thoroughly practised. I will be at another conference this Tuesday, so won't be able to listen to the CC, but if anyone has the chance to ask questions, please ask about what the presentations at ASH are expected to address, and if they are ready for possible questioning by those who attend these conferences as part of any diligence/investment efforts. Patient advocacy groups might also be present, and looking for clarity too.
And finally, the holidays - which start in 2 weeks. Forget about ANYONE making a decision between then and the second week of January, at the earliest. I know we all want something definite to happen RIGHT NOW, but we need to steel ourselves for the next 8 weeks of reality. The world is on holidays, and everyone is looking at their own end-of-year business situation. There will be no big announcement of a deal, partnering, buy-out, white-knight arrangement or anything else until mid-January at the very earliest.
Just trying to be rational. Hope we are all still standing in January.
Like I said, there are folks that go to events like ASH for investment reasons. They will look at the posters carefully and ask questions. If the data is as good as we think it is from the abstracts published last week, things should drift up over 1Q14.
Vid's earlier post is a pretty good description of the current situation around here, unfortunately.
As for the "Why didn't I sell?" question; well, I was, a bit at a time as I needed to, although I was holding back as much as I could expecting a pop from info to be presented at ASH in a few weeks. We have just seen a preview of those presentations and the data looks extremely good - but the various egos in the market generally are not so moved.
I am still expecting something good to happen at ASH - even if it is just folks saying "Oh, this looks like good stuff...guess pona is OK after all ...." The folks that go to these events for investment reasons will look at the posters carefully and ask questions. If the data is as good as we think it is from the abstracts, things should drift up over 1Q14.
As for getting the drug back on the market - yes, of course. But if it stays on the market only in the EU for 3rd line (sorry - I have forgotten the exact EU approval) then off-label use is still possible and the true efficacy of the drug - whether small niche or broad 1st line - will be figured out.
Thanks for your reply. We agree on several points; the large volume of trading is due to what you say, and if any company, competitor or otherwise, traded ARIA according to the rules, then that is just business and not a conspiracy.
My complaint is that high volume/high frequency trading shuts out all but a certain type of investor from participating in the market. If we truly believe in free markets, this situation should not be allowed to occur. A different point is that the type of trading we are now seeing is apparently completely divorced from what ARIA does or can do - the company could be selling BBQ-flavored widgets and it would change nothing. If the stock markets are meant to provide access to capital for constructive purposes, then the current trading serves no purpose and is likely destructive, especially if the method of trading (HFT) can overwhelm any real news of the company's performance.
As for those who advocated shorting the stock prior to the crash, I make no complaint; good for them and I hope they did well. But I can see nothing that shows they were prescient or even smart - they were just lucky. Pointing to individual moments after the fact is just that, after the fact. There were lots of posts over the last two years that said this stock was a disaster - but none said "this is what will happen and at this time". The best post that I can remember was one just before approval last December that said the run-up had ended and it was time to take a profit (at about $24 or so); that post made no prediction of any kind, it was just a prudent statement of taking a sure profit vs. continued holding - which I ignored.
I also do not like conspiracy theories because they have a logical flaw. If the conspiracy was any good, you wouldn't suspect it. Or, if it really is a good conspiracy, then what you think is the conspiracy is actually a decoy. And around we go.
That said, even to my naive eyes, the trading the day before the crash was unusual and the trading since is bizarre. That's why, even though I don't go along with the conspiracy crowd, I filled out the complaint section on the SEC webpage today.
OK - now that I have done that, let's get this BB back to what it was.
If the SAEs could be highly correlated with ANY easily identified factor, then it would be easy to note a contra-indication, and physicians could use the drug as originally intended outside of that situation. Take a look at the package insert of almost any drug, and you will see a paragraph (or more) about contra-indications, i.e. situations in which the drug should not be used.
If long-term dosing with pona causes narrowing of blood vessels, then diabetics and patients with other vaso-occlusion conditions could be expected to face increased risk of SAEs.
Hopefully, enough data was collected in the clinics to allow such correlations to be made. But it could be some months before all the data is reviewed for unexpected patterns.
Or that certain docs have patient populations that are skewed in some unintended manner. For example, a physician that has a practice/reputation of treating obesity, or diabetics, or young athletes, or some other quite legitimate "screen", would have a patient population different from the general population.
As CML arises in that physician's particular patient population, it is not unreasonable to see a different set of SAEs. In fact, such clusters of SAEs should be very useful in determining how to avoid them.
OK, but who are they controlling? This is the part I do not understand.
If the machines/algos are running the show (and with daily volume at about 10x or more of what it used to be, I don't dispute this), are they not trading against other machines/algos?
Yes, I understand that moving a very large number shares many times with just a few pennies made on each trade will add up to a reasonable profit. But there can't be more than literally a handful of retail buyers (and no investment fund buyers) putting any money into this stock, so who is making any money if shares are just moving back and forth between funds? That would be a zero-sum game.
I would also ask that if the pps is controlled by HFT (and I agree that it is) then a strategy with a time consideration outside of the HFT time frame should have some advantage. Naively, it looks like the pps is controlled between 2.20 and 2.70, centered on 2.45. Simple regression should be able to tell if there is an positive or negative slope to this center value over time. So, would not a strategy of making a single trade no more frequently than once a day (and at the same time of day - say noon), buying if under 2.45 and selling if over 2.45, give a positive return?
As I said, I am not an oncologist.
But the regime my brother went through was not a constant dosing, but a cyclical treatment of blast crises by relatively heavy dosing, followed by tapering dosing for maintenance (itself cyclical), and then periods of no medication - until blood workup showed a need.
He had AML, not CML, and that is a different disease. But other people I have known with various other forms of cancer and undergoing chemo have followed a similar cyclical dosing regime - if only to give the liver and immune system a break.
The report in GA's post on SI is that there was (presumably irreversible) narrowing of blood vessels over time - with some patients being dosed for 3 years. (BTW, one might have expected that event to give a rising blood pressure over time.) Given the large number of transduction pathways EGFR and TKIs affect, and our general lack of knowledge of those overall systems, constant dosing seems something you would want to move away from.
But see my first statement!
I keep looking, but I can't find the posting with a link to what I remember as a paper in Nature - this would be 4 to 5 weeks ago. The abstract mentioned that the cardiovascular events (and they were talking about thromboses) could be controlled by anti-coagulants.
The problem may be that I am remembering a paper in Nature and it may have been another journal.
Well, that's what I am remembering, and like I say, I can't find the link anymore. I recall it being about a week immediately before things went pear shaped.
Interesting. The June 2 post says 34% of grade 3 to 4 thrombocytopenia (lack of platelets) which should lead to lack of clot formation and decreased thromobotic events. The FDA announcement (date?) speaks to loss of blood flow due to narrowing of the arteries, a completely different vascular issue.
I agree that "finding the right dose" is likely to be difficult; the therapeutic concentration window and the AE concentration window are probably very nearly the same, or at least have the same lower end.
The length of dosing is something that could be adjusted, as GA suggests in his SI post. A relatively short dosing schedule of pona followed by no medication or a different medication would be a possible treatment regime - but this is something that would probably be found during actual treatment rather than in a clinical trial. Dosing of 2.7 years (the median time noted, and I assume this is a constant dosing) seems a long time without a drug holiday, although I am not an oncologist.
That is interesting news, and not info that I would know how to find. Seriously, is there more info, or a link? I'm curious....
Oldchemist present.
I'm still here, just feeling a lot older than a few weeks ago. I took what I thought would be a "rationality break", but things have gotten less rational.
I lack the the business and investing skills of others, and as I was once a scientist and trained to look at data I cannot comment on conspiracies, nefarious machinations of Wall Street, nor the clash of egos that others may know about. Daily volume of 5 to 10x of what it used to be is clearly observable, and the simplest conclusion is that pps and market cap have no longer any connection to current revenue, potential revenue of new drugs, or clinical results. So we are firmly into irrational behavior regarding this stock, and that has to end - somehow - before any kind of value can be assigned.
The future? Who knows - certainly not me. But even with zero revenue, the company could still run a drug discovery operation for several years with the $150MM on hand now. Massive RIS of course, down to perhaps 30-45 people and all in the lab, but that is all you need for what would be essentially a start-up drug discovery boutique.
And with even a small amount of revenue, say just $15-20MM/yr from a niche market of Iclusig, a boutique drug discovery company could last for a very long time. And then we would be back to "selling the dream", which seems to be a much better business than actually selling a real product!
Maybe there will be something in a poster at ASH, or ASCO next spring, as I mentioned in a previous post...but that is just hoping.
So we hope.
And don't forget how he stood up and fought for his rida patents back in 2010 (I think it was). I read those - it was not a easy task, and he prevailed.
OK - I am getting carried away with all this so will pause a day or two for a rationality break, and to try to earn a few $$ the old fashioned way.....
2da, you might be right about selling being the only way out, but frankly, I would like HB and ARIA to stand and fight.
Regarding lawsuits - I am not a lawyer, but there is a need for the plaintiff to prove the defendant did something wrong. If HB or anyone else at ARIA knew about a poor clinical situation, but did nothing (including altering their own sales schedules), it is gojng to be hard to prove wrong-doing. If the data was showing AEs, then the trials should have been halted (paused) - and they were. And you have to ask the FDA to do that (as far as I know). Not sure how any company would announce an issue in clinical trials without causing a problem with their share price.
Actually, I'd prefer if HB and the rest of ARIA said nothing until they have real info to report.
The trading now has nothing to with the science and substance of ARIA - the company could be selling widgets with chocolate sprinkles on them for all the traders care. So let the folks at ARIA get things lined up thoughtfully and correctly; the posters for ASH prepared (and the presenters even better prepared), concrete plans for the clinic from the FDA, informative statements from their medical advisors, and other public statements/announcements prepared, and maybe even something with the lawsuit crowd (hope HB stands there with his arms crossed and tells them.....the appropriate and professional things that I know he will say!)
I have had to make material re-arrangements in my life now; it is too late for anything else. So I see no reason not to support HB and ARIA, and cheer them on whether they decide to sharpen their swords or negotiate peaceful terms.
So let the 'bots go nuts and maybe they will drive the SEC to investigate machine trading!
Can I call a third-party unilateral truce?
TKIs do not alter a person's genomel (at least, let's hope not!) But they do alter the expression of genes in a person's genome. So, it is correct to say that response to the drug is "genetic" in mechanism, but it is equally correct to say it does not alter genetic material.
We are all used to thinking of drugs that directly affect the target - think steroids or antibiotics or antidepressants. TKIs (and other drugs) affect gene expression, and it is the resulting cascade of cellular events (on or off) that results gives the therapeutic response. Even paclitaxel could be considered to have a "genetic mechanism" as it prevents cells from properly re-distributing their genetic material during cell division (so they die), but it certainly does not affect the genome.
Thanks - forgot to add that CELG tried to get single-enantiomer ritalin on the market for adult dosing in the late 90s, and I remember this being a step along the road from biocatalysis to pharmaceutical house. Similar to Sepracor's move a few years earlier.
I am obviously better at history than investing, but the volume I really do not understand - in the last five sessions (which you note), plus the PM and AH numbers, almost 250m shares have traded, about 1.5x the entire issued amount. Well, I guess a quarter of a billion shares spread over a 2 dollar range (about 4-6) and taking the average of that, means that about $250m have been "generated" and will count in the GDP, even though a good company has been nearly destroyed in the process.
Bit of an indictment of the capital markets.....
I know I am stating the obvious, but ARIA will get huge attention as ASH although not for scientific reasons. Hope the poster presenters are well prepared - those posters will be scrutinized as if they are worth a few billion dollars (!!)
Damn, I'd almost expect HB and TC to be giving the posters themselves!
CELG - a good company whose stock I have never owned. I remember them as a biocatalysis outfit in the late 1980s. They have certainly proven they are very very good at business over the years, and are willing to "follow their technology" to where it tells you to go, unlike many.
They took thalidomide (back) into the market - very gutsy, so they certainly have the experience to get drugs on the market with horrific AEs in the wrong patient population (i.e. pregnant women) but great benefit otherwise to relatively small populations. And they took over Abraxis and Abraxane, but I don't know what the financials were for that. I also don't know what happened to the folks at Abraxis after the takeover, but my recollection is that all Abraxis had was the formulation technology for Abraxane anyway - bit of a one trick pony, at least as I remember. But again, paclitaxel is not without its own AEs, so CELG has more experience there with both dosing and delivery of that (very cytotoxic) drug.
CELG could certainly mount a $15/share ($3BB cap) for ARIA, so - yes - my gut says this is a realistic scenario, and one I'd certainly like to see one morning.
But as I always say, my advice is worth just what you paid for it!
Not at all unrealistic, and lesser pipelines have been bought for more. Plus, there will be some revenue from Iclusig - even $25MM/yr would keep a small science-based company going just fine.
I will take a positive view of of the lack of announcements from the company as an indication of planning. Announcements coinciding with presentations at ASH would be the obvious timing, especially if there is anything interesting in the posters (the content of which would have been planned at least a month ago).
The paper posted in a link about 2 weeks ago (the link that I can 't find now, of course) said that the thrombotic events could be managed with standard anti-coagulants and made no further fuss. Well, that is just from memory, and I also remember that the incidence of thrombotic events noted in tehat paper were under the total 20% number that has been put out there recently. So I'd really like to find that paper!
One week later; 1.3MM shares trade in the first 15 min and the price moves only a few pennies. My conclusion - late, simple, naive, uninformed, call it what you want - is that none of the science or substance of ARIA counts for anything at this point. The stock is merely a symbol for trading.
So no point in doing anything until ASH. That's about 6 weeks away and should give ARIA time for speaking with the FDA (I assume there is the usual 30-day lead time there), announcements from the company about cost-savings/financing/partnering/not partnering/lawsuits/more clinical data/Rx updates/new pipeline and any other announcements the might get us out of the Land of Trading Targets.
Just my thoughts.....
Thanks, that link worked for me the first time. What I meant was - do you have the link to a different Nature paper that was posted here about 10 days ago (maybe two weeks)? I can't seem to find it going backwards in the posts.
Can you post the link to the NAture paper from about 2 weeks ago? I can't find the message with that link (or direct me to that message)
Thanks
MRK downgraded due to R&D performance
http://www.fiercebiotech.com/story/big-shift-analyst-takes-skeptical-stance-mercks-rd-prospects/2013-10-14?
Wonder what (if anything) this might mean for some kind of arrangement between ARIA & MRK......
I am curious about the volume too. Since last tuesday, the entire amount of issued stock has traded about 1.3 times; wonder if that is a record. I thought "painting the tape" was outlawed many years ago, although I guess there are modern equivalents. Or it is all just in-and-out shorts and day-traders....
I agree, especially to face down the legal vultures. What he did for patent defence of rida a little over 2 years ago was great. Lesser folks would have capitulated - HB didn't and he won. And his choice of words and overall performance in the investor call this past April was magnificent.
Way too much fuss being made about lawsuits in my totally uninformed opinion. The plaintiff would have to prove intent. If HB (or any other member of mgmt) knew bad things, but said nothing, did nothing (i.e. didn't trade, etc) and let the clinicians do their job, reported the results that they could and didn't try to fudge the trials or data - well - then they did the right thing.
Yes, both in clinical trials and duly reported. One was literally an hour or two after the patient was dosed (that is my recollection) so while it had to be reported, it is hard to see how it had anything to do with the drug. That event did engender some discussion about how AEs should be judged when the patient population is so sick anyway.
But that was then....
Thanks, but I'm trying to be a CTO (without much luck).
Good question - with zero in the bank account what do you do? Well, don't forget there is still a revenue stream - small but real. (I am going to assume that pona continues to be sold at some level at least for a while). Are there some milestone payments leftover from rida? (I have not been paying attention - maybe these are all done.)
A private company with a (small) revenue stream, IP, a pipeline, labs & staff should not be difficult to finance privately. A 100:1 reverse split (or whatever) on everyone's stock, recapitalize to whatever amount works (easy to do if you own it all) and there should be folks willing to invest privately.
As for the circling legal vultures? A private company with a valuation of a few hundred million and no cash is not a great target.
Hey, but what do I know? I wasn't smart enough to avoid the situation I am in now!
I have no idea what Tim C, HB, etc or anyone else is thinking, but how about this scenario. Let it drop to about $1 and then take the $150MM cash on hand and buy it all back - taking ARIA private.
if I were mgmt, that would sound good to me as I would get to keep everything. It may not be worth much, but I get to keep it and start again without any of the silliness of the market to distract me.
I don't know you as other than ariafan, but I wish you good health. A lesson learned for me too, about myself. Not a pleasant one, and a bit late in life, but it still counts as an experience in which we were active participants, rather than watching from the sidelines.
All the best.
Agree with both of you - and thanks 2damoon1 for your reply.
BP is not good at finding new drugs; the R&D mechanism has not worked well for some time now and this is widely acknowledged. I will even go so far to say that BP is thrashing about trying to find a better drug discovery model and has not been able to do so; small companies remain the engine of discovery. Period.
I believe a Roche/Gen-type partnership would be better for continuing drug discovery than an outright buyout, but that is an operational detail and would have minimal effect on the dollar value of the overall transaction.
ARIA is a small company, with some revenue, good IP and a pipeline. It is attractive. Putting a deal together will take most of the 3-5 months you project. I figure that is a realistic, if the only, path forward and that MRK is the best suitor at this point.