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Ombow, Here are my reasons for expecting a shorter timeline to get an Ampakine to market in RD than some other compound for another indication.
1. Opportunity to target acute areas first with an injectable formulation either prior or concurrent with opioid administration, or as a rescue measure. The clinical trials would be much shorter to conduct than for a chronic use indication.
2. Opportunity to target the acute area constrained to hospital or clinical usage means that the FDA would not be as worried with off-label usage or other abuse considerations, and reduce the opportunity for additional FDA pre-approval requirements.
3. Lack of existing / competing compounds for the indication means no need to do a comparison.
4. Application to a potentially fatal with significant incidence indication in healthy subjects means that it would be handled with higher priority by the FDA.
Again, I'm sure others could add better detail, but try to compare this process with one for say a cancer drug where the benefit is measured as statistical additional survival years, or some drug for a crowded chronic indication like asthma, and I think the timeline is much shorter.
Emenem, I thought I’d toss out my opinion. Others could say this better… Waiting for Cortex to release information in our current financial environment is obviously causing increasing pessimism, which I think is somewhat unwarranted. Yes, they need to raise money in the next few months, but I don't think they are limited to raising money just through a PIPE or RD deal. The company is probably looking at RD as potential cash cows for funding their other programs, and is certainly very cautious of any partnership in RD because of its huge proven potential.
If it were my call, I would be focusing on a partnership in another area to allow the company to increase their negotiating leverage. I suppose we could see an early partnership in RD. My guess is that some companies are working hard to get Cortex to partner RD sooner rather than later since whole opioid pain franchises are at risk. Remember that Dr. Stoll said they were surprised by the high level of interest in AD when they were shopping CX717 around for ADHD. Since then they have brought forward several alternative compounds and some promising major programs at other companies have collapsed. Also, ADHD is still in play, both in Europe and the US, and Cortex noted that there has been increased interest in these areas. The FDA may have modified its position somewhat in the last year with the release of study results that show that the prevalence of ADHD is greater than previously believed, and that the current stimulant treatments retard growth in children and lose efficacy after a couple of years of use.
If a deal is done soon in RD, I expect the terms to be pretty good, since the foundation work is solid and the timeline to market in RD is relatively very short. This makes it a lower risk with a relatively short term payout compared to other new drug programs. Combine that with the huge potential returns, and possibility of easily moving to other applications (sleep apnea) and the terms should be very good for Cortex. BP is hurting (look at Merck’s recent re-org) and the current financial environment pressures them as much as Cortex.
I don't remember seeing Dr. Stoll's bio has been posted here. This came from the bios posted for presenters at the BMO CAPITAL MARKETS 2008 FOCUS ON HEALTHCARE CONFERENCE. He certainly has a background that lead one to expect a good understanding of the value of an RD-free opioid.
Roger G. Stoll, Chairman, President and CEO
Cortex Pharmaceuticals, Inc.
Roger G. Stoll was appointed Chairman, President and CEO of Cortex Pharmaceuticals, Inc. in August 2002 after serving on Cortex’s Board of Directors. Dr. Stoll has over 30 years of experience in the pharmaceutical, medical devices, and diagnostic industries.
Prior to joining Cortex, he served as a consultant to the venture capital industry on the East coast. Prior to that he was the Executive Vice President of Fresenius Medical Care – North America, in charge of both the dialysis products and laboratory services groups.
From 1991 to 1998, Dr. Stoll was Chief Executive Officer of Ohmeda, Inc., a worldwide leader in anesthesia and critical care products, with sales of approximately $1 billion and more than 5,000 employees. At the same time he served on the board of directors of the BOC Group, Plc in the UK, which was the parent of Ohmeda.
From 1986 to 1991, Dr. Stoll held positions of increasing responsibility within Bayer, AG. Initially at Bayer, he was President of the Consumer Health Care Group of Miles. He then became the Executive Vice President and General Manager of the worldwide Diagnostics Business Group of Bayer, during which time the business expanded from $400 million to approximately $1 billion in sales.
From 1976 to 1986, Dr. Stoll worked for American Hospital Supply Corp. (now Baxter International), where he rose from Director of Clinical Pharmacology to President of the American Critical Care Division, a critical care pharmaceutical company.
He began his career in 1972 at the Upjohn Company where he conducted human pharmacokinetic and drug metabolism clinical trials in all phases of drug development.
Dr. Stoll received his bachelor’s degree in pharmacy from Ferris State University, and a Ph.D. in Biopharmaceutics from the University of Connecticut; he performed postdoctoral studies in pharmacokinetics and drug metabolism at the University of Michigan.
In addition to his role as Chief Executive Officer and Chairman of Cortex Pharmaceuticals, Dr. Stoll currently serves as a member of the boards of directors of Chelsea Therapeutics, and on the School of Pharmacy Alumni Advisory Board of the University of Connecticut.
JD,
I am much more optomistic about the future SP than many others. Here is my best case scenario:
1. Good RD-1 results: SP jumps to ~2.00, then settles at 1.25 to 1.50 as people wait for 'The Financing'
2. Partnership announced for global RD only with terms on the order of $10M/year research support, ~15% of earnings, and $50M up front with the partner (SPG, JNJ or PFE) taking 10M new shares: SP jumps to ~6.00, then settles ~4.00
If RD-1 is not clean, then I would divide everything (except revenue from sales) by 2. At this point, I don't see a huge downside. If things are perceived to be negative, then we'll see a drop to ~0.40, but I think the partnership will still follow with the jump to ~3.00.
Now I know why so many people are in financial trouble...
Neuro,
Thank you. That is a nice explanation.
Karl
Neuro,
Thanks. Is his work with mGluR5 receptor supression at odds with with Lynch et al 's work with increasing BDNF in the Fragile X mice models? Does the positive results for both suggest that a combination therapy of some kind may be required for Fragile X patients? The descriptions seem to imply multiple genetic defects in these folks.
Thanks,
Karl
http://www.jneurosci.org/cgi/content/abstract/27/40/10685?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&author1=lynch&fulltext=fragile+x&andorexactfulltext=and&searchid=1&FIRSTINDEX=0&sortspec=relevance&resourcetype=HWCIT
I heard an interesting story on NPR about Fragile X and autism on my way to work this morning. I think Davidal has mentioned Fragile X as a good orphan indication for Cortex to explore.
http://www.npr.org/templates/story/story.php?storyId=94810949
They report that some drugs are currently in clinical trials, and that some have promise. An Ampakine is not mentioned as being a potential treatment. The FRAXA web site has some information.
http://www.fraxa.org/default.aspx
…. Now back to the regularly scheduled bickering and whining.
Thanks,
Karl
gfp,
Thank you. So even counting the expired warrants and subtracting for employee options, the company can only sell close to the newly allowed 30M shares minus any new warrants in PIPE #6. It doesn't look like this would be able raise more than $10-15M, only enough money for another year to a year and a half. My guess is that if these newly authorized shares are used, it would only be as part of a partnership arrangement.
Karl
gfp,
Could you please repost your repost of your warrent summary? As I recall there are warrents that have expired this summer, some that will be exercised or expire this winter, and some later next year. I think these are all exercisable at higher values, so we will either have fewer outstanding shares, or raise some cash.
Thanks,
Karl
I think the simplest explaination is the most probable - that we are grossly underestimating the difficulty in properly analyzing the data. For example, here is an old paper by the german clinician performing the study which shows a much deeper level of concern for assessing the individual response to opiods. I would guess that he would be trying to somehow normalize his response criteria to combine the data to allow for statistical analysis.
http://www.anesthesiology.org/pt/re/anes/selectreference.htm;jsessionid=LQPXXXPN3S1DlbgwvCtJbxZZHFSkh3Qy0pWcdtTvJnz9yT2M2QkY!-2013963969!181195629!8091!-1!1221611351229?an=00000542-200809000-00023&id=P93&data=00008571_2002_12_3_lotsch_polymorphism_|00000542-200809000-00023%23xpointer(id(R18-23))|1160700||ovftdb|00008571-200201000-00002&lu=ovid:/bib/medline/11773859/ui
Medline Link Record
Unique Identifier
11773859.
Authors
Lotsch J; Skarke C; Grosch S; Darimont J; Schmidt H; Geisslinger G.
Authors Full Name
Lotsch, Jorn; Skarke, Carsten; Grosch, Sabine; Darimont, Jutta; Schmidt, Helmut; Geisslinger, Gerd.
Institution
Pharmazentrum Frankfurt, Johann Wolfgang Goethe-University, Frankfurt, Germany. j.loetsch@em.uni-frankfurt.de
Title
The polymorphism A118G of the human mu-opioid receptor gene decreases the pupil constrictory effect of morphine-6-glucuronide but not that of morphine.[see comment].
Comments
Comment in: Pharmacogenetics. 2002 Jan;12(1):1-2; PMID: 11773858
Source
Pharmacogenetics. 12(1):3-9, 2002 Jan.
Abbreviated Source
Pharmacogenetics. 12(1):3-9, 2002 Jan.
NLM Journal Name
Pharmacogenetics
Publishing Model
Journal available in: Print
Citation processed from: Print
Country of Publication
England.
MeSH Subject Headings
Adult
Cross-Over Studies
Female
Humans
Male
Morphine Derivatives/bl [Blood]
*Morphine Derivatives/pd [Pharmacology]
Mutation/ge [Genetics]
Pharmacogenetics
*Polymorphism, Single Nucleotide/ge [Genetics]
*Pupil/de [Drug Effects]
*Receptors, Opioid, mu/ge [Genetics]
Abstract
Large individual differences in the clinical response to morphine therapy have been known for a long time by clinicians. The recent advances in genomic research encourage the search for pharmacogenetic causes of that variability. As a measure of central opioid effects, pupil diameters were assessed every 20 min for 18 h after administration of morphine or its active metabolite morphine-6-glucuronide (M6G) in a two-way crossover study. The opioid effects were compared between six subjects with a single-nucleotide polymorphism (SNP) A118G in the mu-opioid receptor gene (five heterozygous, one homozygous) and six control subjects. Non-parametric pharmacokinetic-pharmacodynamic modelling was employed to identify the influence of the A118G SNP on the concentration-response relationship of M6G and morphine, which was described by a sigmoid Emax model. As a measure of potency, the EC50 of the pupil constrictory effects of M6G was 714 +/- 197 nmol/l in wild-type and 1475 +/- 424 nmol/l in heterozygous carriers of the A118G SNP. In the homozygous carrier of the SNP, it had an EC50 of 3140 nmol/l. In addition, the dose-response relationship was flatter in the A118G carriers than in control subjects (shape factor of the sigmoid Emax model: gamma = 3.3 +/- 1.2, 1.7 +/- 0.5 and 1.6 for wild-type, heterozygous and the homozygous A118G carriers, respectively). In contrast, the concentration-response relationship of morphine was not affected by this specific SNP. The A118G SNP in the mu-receptor gene significantly reduces the potency of M6G in humans.
ISSN Print
0960-314X.
Publication Type
Journal Article; Research Support, Non-U.S. Gov't.
Date of Publication
2002 Jan
Year of Publication
2002
Entry Date
20020325
Revision Date
20061115
Update Date
20071203
I find it hard to believe that a company like Parexel would be dragging out a small project for any reason. Like any company, they would want it completed and move on. They also would not want to compromise their reputation with small companies, where they seem to do a significant amount of work.
http://www.parexel.com/clinical_research/data_management.html
http://www.parexel.com/clinical_research/biostatistics.html
Karl
We've seen similar pps behavior prior to expected news in the past. I have always thought this type of action was just the opportunistic manipulation of a thinly traded stock with nervous investors to enable the acquisition of shares more cheaply, either to sell on a quick rebound with higher volume, or hold through the event with a lower basis. The trading yesterday was a bit odd, and I wondered at the time whether those shares would show up on the market again soon. It's too bad that we can't track the sale of individual shares - "Hey, old share number 1,486,581 was traded again today!"
Karl
Sorry if this is old news, but I was looking through the Cortex web site, and their pipeline chart appears to be updated from what I remember seeing before. Doesn't it say that they have outlicensed CX1739, CX1942, and CX1796 to Schering-Plough for ADHD? Maybe I am not remembering the chart correctly.
http://www.cortexpharm.com/prodpipe/index.html
Karl
Neuro,
Perhaps the Psychiatry Division is more receptive to new ADHD treatments now than they were about a year ago because of the results of recently published studies. I thought that it was ironic that the results for two of these were published soon after the rejection of CX717 last year. (For those that are interested, he best source of ADHD information is probably at NIMH, link below.)
Thanks,
Karl
NIMH Link:
http://www.nimh.nih.gov/health/publications/adhd/summary.shtml
http://www.medicalnewstoday.com/articles/88431.php
ARTICLE:
ADHD Drugs Ineffective Over The Long Term
Editor's Choice
Main Category: ADHD
Also Included In: Psychology / Psychiatry; Pediatrics / Children's Health
Article Date: 12 Nov 2007 - 0:00 PDT
Apart from being ineffective over the long term, ADHD (attention deficit/hyperactivity disorder) drugs may also undermine your child's physical growth, a BBC television program, Panorama, has revealed. Scientists seem to be saying that claims made about ADHD drugs some years ago were overstated.
A long-term monitoring program involving 600 kids across the United States since the beginning of the 1990s was shown in the TV program - with some of its results. It is called the Multimodal Treatment Study of Children with ADHD. The study concluded that over the long term, such ADHD drugs as Concerta and Ritalin have no demonstrable benefit for children - long term means after three years of taking the drug(s).
The use of ADHD drugs in much of the developed world has doubled over the last five years - many say it has become a cure-all for bad behavior.
In 1999 studies had claimed that a one-year course of ADHD medication is more effective for a child with ADHD than behavioral therapy. These studies had a strong influence on how doctors would treat their patients. According to Professor William Pelham, University of Buffalo, USA, the findings were exaggerated.
Pelham says he believes the beneficial impact of medication in the first study was exaggerated. It had been thought that kids would have better outcomes if they were medicated for longer - however, it is not the case, there were no beneficial effects at all.
ADHD medications also stunt a child's growth, he/she runs a very high risk of losing height and weight, compared to children who do not take the medication.
Pelham said "In the short run they will help the child behave better, in the long run it won't. And that information should be made very clear to parents."
According to Pelham, behavioral therapy and a simple diet of Omega-3 may help a child as a first move.
(Continued... use link above)
http://archpedi.ama-assn.org/cgi/content/abstract/161/9/857
ABSTRACT:
Prevalence, Recognition, and Treatment of Attention-Deficit/Hyperactivity Disorder in a National Sample of US Children
Tanya E. Froehlich, MD; Bruce P. Lanphear, MD, MPH; Jeffery N. Epstein, PhD; William J. Barbaresi, MD; Slavica K. Katusic, MD; Robert S. Kahn, MD, MPH
Arch Pediatr Adolesc Med. 2007;161(9):857-864.
Objective To determine the US national prevalence of attention-deficit/hyperactivity disorder (ADHD) and whether prevalence, recognition, and treatment vary by socioeconomic group.
Design Cross-sectional survey.
Setting Nationally representative sample of the US population from 2001 to 2004.
Participants Eight- to 15-year-old children (N = 3082) in the National Health and Nutrition Examination Survey.
Main Outcome Measures The Diagnostic Interview Schedule for Children (caregiver module) was used to ascertain the presence of ADHD in the past year based on Diagnostic and Statistical Manual of Mental Disorders (Fourth Edition) (DSM-IV) criteria. Prior diagnosis of ADHD by a health professional and ADHD medication use were assessed by caregiver report.
Results Of the children, 8.7% met DSM-IV criteria for ADHD. The poorest children (lowest quintile) were more likely than the wealthiest (highest quintile) to fulfill criteria for ADHD (adjusted odds ratio [AOR], 2.3; 95% confidence interval [CI], 1.4-3.9). Among children meeting DSM-IV ADHD criteria, 47.9% had a prior diagnosis of ADHD and 32.0% were treated consistently with ADHD medications during the past year. Girls were less likely than boys to have their disorder identified (AOR, 0.3; 95% CI, 0.1-0.8), and the wealthiest children were more likely than the poorest to receive regular medication treatment (AOR, 3.4; 95% CI, 1.3-9.1).
Conclusions Of US children aged 8 to 15 years, 8.7%, an estimated 2.4 million, meet DSM-IV criteria for ADHD. Less than half of children meeting DSM-IV criteria report receiving either a diagnosis of ADHD or regular medication treatment. Poor children are most likely to meet criteria for ADHD yet are least likely to receive consistent pharmacotherapy.
Author Affiliations: Department of Pediatrics, Cincinnati Children's Hospital Medical Center, University of Cincinnati College of Medicine, Cincinnati, Ohio (Drs Froehlich, Lanphear, Epstein, and Kahn); and Departments of Pediatric and Adolescent Medicine (Drs Barbaresi and Katusic) and Health Sciences Research (Dr Katusic), Mayo Clinic, Rochester, Minnesota.
They were not necessarily 8Ks. They are listed only as 'Confidential Treatment Orders'. Perhaps the company has already entered into a partnership and will announce this tomorrow.
While I'm here, I have to say that I'm having a hard time seeing the downside as presented by some on the board. I think the only risk is that the estimated dosing is off. If the results fail to show the expected results it means that 1. We don't understand how opiods work; 2. We don't understand how respiration works, or 3. There is a much bigger than expected difference in the PBC between mice and humans. This is the kind of information that drives new drug development, and is worth big bucks.
The folks at the University of Alberta have published some additional work that further supports the role of AMPA receptors in the mediation of respiratory rhythm. I don't think this paper has been referenced earlier, and I do not have access to the full text. The abstract is copied below. Looking at the published papers that reference the paper by Smith et al is a quick way to see the breadth of work done in this area.
http://www.sciencemag.org/cgi/content/abstract/254/5032/726?ijkey=43b548ea3b13768e387eb0c5946317c003d0e969&keytype2=tf_ipsecsha
J Physiol Volume 586, Number 9, 2357-2370, May 1, 2008 DOI: 10.1113/jphysiol.2007.150532
http://jp.physoc.org/cgi/content/abstract/586/9/2357
RESPIRATORY
Distinct receptors underlie glutamatergic signalling in inspiratory rhythm-generating networks and motor output pathways in neonatal rat
M. F. Ireland1, F. C. Lenal1,2, A. R. Lorier1,3, D. E. Loomes1, T. Adachi1, T. S. Alvares1, J. J. Greer1,2 and G. D. Funk1,2,3
1 Department of Physiology
2 Centre for Neuroscience, Faculty of Medicine and Dentistry, University of Alberta, Edmonton, Alberta, Canada T6G 2H7
3 Division of Physiology, Faculty of Medical and Health Sciences, University of Auckland, Auckland, Private Bag 92019, New Zealand
ABSTRACT
Despite the enormous diversity of glutamate (Glu) receptors and advances in understanding recombinant receptors, native Glu receptors underlying functionally identified inputs in active systems are poorly defined in comparison. In the present study we use UBP-302, which antagonizes GluR5 subunit-containing kainate (KA) receptors at 10 µM, but other KA and AMPA receptors at 100 µM, and rhythmically active in vitro preparations of neonatal rat to explore the contribution of non-NMDA receptor signalling in rhythm-generating and motor output compartments of the inspiratory network. At 10 µM, UBP-302 had no effect on inspiratory burst frequency or amplitude. At 100 µM, burst amplitude recorded from XII, C1 and C4 nerve roots was significantly reduced, but frequency was unaffected. The lack of a frequency effect was confirmed when local application of UBP-302 (100 µM) into the pre-Bötzinger complex (preBötC) did not affect frequency but substance P evoked a 2-fold increase. A UBP-302-sensitive (10 µM), ATPA-evoked frequency increase, however, established that preBötC networks are sensitive to GluR5 activation. Whole-cell recordings demonstrated that XII motoneurons also express functional GluR5-containing KA receptors that do not contribute to inspiratory drive, and confirmed the dose dependence of UBP-302 actions on KA and AMPA receptors. Our data provide the first evidence that the non-NMDA (most probably AMPA) receptors mediating glutamatergic transmission within preBötC inspiratory rhythm-generating networks are pharmacologically distinct from those transmitting drive to inspiratory motoneurons. This differential expression may ultimately be exploited pharmacologically to separately counteract depression of central respiratory rhythmogenesis or manipulate the drive to motoneurons controlling airway and pump musculature.
(Received 25 December 2007; accepted after revision 12 March 2008; first published online 13 March 2008)
Corresponding author G. D. Funk: 7–50 Medical Sciences Bldg, Department of Physiology, University of Alberta, Edmonton, Alberta, Canada T6G 2H7. Email: gf@ualberta.ca
--------------------------------------------------------------------------------
F. C. Lenal and A. R. Lorier contributed equally to this work.
The University of Alberta apparantly holds or has applied for a patent for the use of ampakines in treating respiratory depression. (I tried to search the US Patent and Trade Mark data base, but could not find it. Maybe someone else can.) Cortex in-licensed the rights to their use patent. The referenced article for respiratory depresson is at the link below.
http://ajrccm.atsjournals.org/cgi/content/full/174/12/1384
I wonder if this will have an impact on COR and other sub-$1 stocks.
---------------------------------
AP
NYSE Snaps Up Amex, Ending Long Rivalry
Thursday January 17, 5:18 pm ET
By Joe Bel Bruno, AP Business Writer
NYSE Agrees to Acquire Rival American Stock Exchange to Increase Options Business
NEW YORK (AP) -- The New York Stock Exchange on Thursday agreed to buy the American Stock Exchange, ending a once intense rivalry that began in colonial times when brokers traded in outdoor markets.
Both exchanges have battled for corporate listings and bragging rights since the early 1900s, with their trading floors just a short walk away from each other in Lower Manhattan. Newspapers around the country all listed the stock swings on the nation's two dominant markets, until investors began paying more attention in the 1990s to technology issues on the upstart Nasdaq Stock Market.
Their evolution took a very different path -- with the Big Board forming NYSE Euronext to become the world's first trans-Atlantic exchange. The AMEX, unable to compete like it once did, began to focus on trading options and other financial products.
The AMEX, which once hosted the likes of big-name stocks such as The New York Times Co. and The Washington Post Co., now trades generally smaller companies that are often too illiquid to meet the standards of bigger rivals.
NYSE Euronext said it would pay AMEX's seatholders, which are generally members that trade at the exchange, $260 million in stock. In addition, they would receive more stock after the sale of the AMEX's landmark building on 86 Trinity Place -- a landmarked art deco building it moved into in 1921 and that sits only blocks away from the World Trade Center site.
The deal will give NYSE Euronext a second U.S. license for an option exchange. It would make the NYSE the No. 3 U.S. options marketplace.
The NYSE has been looking to move further into the options business.
I have been happy with TDAmeritrade. I don't know all of their fee structure, but my trade fees have been reasonable. I think they also have a promotion for opening a new account where they give you a few bucks.
Someone asked about a merger with another little biotech company that had money, but no compounds. Neurochem(NRMX)might fit that profile with a failed AD drug and 80M in the bank. Cortex has compounds and only 20M in the bank. The trouble is that the market cap for NRMX is ~200M compared to ~30M for COR. Where would that leave COR shareholders after a merger? However, NRMX has locations in Quebec and French-speaking Switzerland... Maybe a French speaking CMO would boost the COR share of the combined company.
Aiming, I was looking for and could not find one of gfp's old posts where he summarized the outstanding warrants. I suppose I could it myself by looking through the latest quarterly report, but it might be of interest to others.
Thanks,
Karl
jerrydylan, I see that Dr. Tran is from France. I also remember that the RD pilot study will be conducted at a 'European Clinic'. Maybe the choice of clinic was Dr. Trans?
Karl
A Reuters article came out Friday that supports Jim H's position on executive options. (Aiming, I apologize for the redundancy if this has already been shared with the board.)
http://biz.yahoo.com/rb/071012/column_lifting_ceo.html?.v=1&.pf=career-work
Reuters
CEO option grants seen harmful
Friday October 12, 4:44 pm ET
By Gina Keating
LOS ANGELES (Reuters) - A big package of stock options is no substitute for actual ownership when aiming to encourage chief executives to take prudent risks that provide reliable stock returns, according to a new study.
CEOs whose compensation packages include a large percentage of stock options tend to make risky decisions that generate big share price losses more often than big gains, said study authors W. Gerard Sanders of Brigham Young University and Donald Hambrick of Penn State University.
Proponents of stock option awards say they attract and retain talented executives, and give managers a vested interest in the company's future stock performance.
But the study's authors say they are hardly effective in boosting company results.
"While they were implemented as a substitute for stock ownership, they don't mirror stock ownership because they have no downside," said Sanders, associate professor of strategic management at Brigham Young.
"It's somewhat akin to walking down the Strip in Vegas and handing money to a gambler and... promising to share only the upside," he said.
The study of 950 companies, randomly selected from the Standard & Poor's 500 Index, as well as mid-cap and small-cap indexes, is to be published in the October-November edition of the Academy of Management Journal.
A stock option gives the holder the right to buy a number of shares at a preset price for a specified period.
Stock options as an executive compensation tool reached their pinnacle of popularity in the late 1990s before losing ground in the dot-com meltdown.
Executive stock options have also been tarnished by the recent scandal over backdating and other methods of manipulating grant dates to inflate their value. Scores of companies have launched internal probes or are the subject of official investigations.
The study authors tracked corporate results between 1993 and 2000, examining the relationship between the percentage of CEO compensation given in options and each company's investment and financial performance.
The average percentage of CEO compensation comprised of options among the companies was 25 percent, said Sanders.
The professors found that CEOs with a higher proportion of stock options presided over companies with higher investment spending and more extreme stock performances.
Overall, big losses were more common than big gains when CEOs were given high levels of options pay.
In companies where options constituted half or more of a CEO's pay, 10.1 percent sustained extreme shareholder losses, while 6.8 percent enjoyed large gains.
"There are only a few hitters who when they swing for the fences get a home run," Sanders said. "The options don't motivate them to look at the downside."
Company performance improved, on average, as stock option use declined, Sanders said.
Companies with "options-heavy" CEOs had an average annual shareholder return of 26 percent versus 36.5 percent for companies run by "options light" CEOs during the study period.
Extreme shareholder losses occurred at only 2.5 percent of the firms where stock options made up 20 percent or less of CEO pay, according to the study.
While some companies have walked away from option compensation in recent years, it is still widely used as a compensation tool, Sanders said.
"You can make the inference... that firms would be better off if they use moderate levels of stock options," Sanders said. "It's fair to say from our data that going very heavy with options is likely to have a negative effect on the health of the company."
Yes, I believe we have underestimated the significance and market size for RD. This is an old article (Dec 1996) but has a good description of drug induced respiratory depression. I think neuroinv's estimate of $10M upfronts for an ampakine showing positive phII data in RD with minimal side effects is too low.
Here is the link, and the first couple of paragraphs from the paper:
http://www.uspharmacist.com/oldformat.asp?url=newlook/files/Feat/ACF2ECE.cfm&pub_id=8&articl...
Drug-Induced Respiratory Depression
C. Michael White, Pharm.D.
Studies have demonstrated that billions of dollars and thousands of lives are lost each year due to drug-induced diseases,1 and 41% of all patients receiving drug therapy for >2 years experience an adverse drug event.2 Only 0.5%–1.2% of total adverse drug events are respiratory in nature but account for an astounding 12.3% of life-threatening drug-induced disease and 25%–30% of drug-induced deaths. 2 This may be attributable to the high blood flow received by the two main organs involved: the lung, which is the only organ to receive 100% of the blood supply, and the brain.
This article describes the pathophysiology of centrally mediated respiratory depression and then presents implicated drugs, patients most at risk, the utility of potential antidotes and possible alternative agents. New agents discussed include tramadol, nalmefene and flumazenil.
<<What has happened to gfp927z? No messages in the past 10 days. Have you cashed out and gone back to the money market?>>
At last report he was chasing girls in France, back sometime next week.
Aiming,
I agree with all of your points, but after one crisis caused by an interaction at high concentrations / dosage, I expect Dr. Stoll will want to stick to low doses. But you're right, if CX516 is effective at low dosages that would provide another option.
Aiming,
According to the CC discusion, Dr. Stoll was concerned with the dosage required with CX516 to be effective, and the increased potential of side-effects associated with the higher dosage, not the half-life of the compounds. I'm sure someone else remembers the relative potency of CX516, CX717, and CX707, but I remember big differences. I don't think any company would want the increased risk of derailing the program that was eating all of their funds if they had a much better candidate available. As always it comes down to a cost and risk analysis of the various options.
I've now had a chance to hear the CC and read all of the post-CC comments. I'm a bit surprised by some of the take-aways that from those on the board. I guess we all hear what we want to. I thought (my filter!!) that the biggest news was the compressed time table and reduced cost of pursuing the RD indication. 3-4 years to an NDA with a total cost of under $60M for a drug in the $B range is huge. We have never been able to consider the possibility of Cortex pursuing an NDA on their own. Lets face it, just the threat of Cortex doing this ups their bargaining position dramatically for any compound in any indication. The BPs now must realize that Cortex can hold out for better terms. Another great aspect of this is that we will know fairly soon how this will play out with the pilot study.
Perhaps Neuro can add his 2 cents since he asked the RD questions, but I think the (acute) RD indication significantly increases Cortex's bargaining position and will likely increase the revenue for any out-licensing activity. Add this to the possibility of owning a $B drug outright in a relatively short time frame, and I think the company is in a great position.
Confucius say black swan sometime lay gold egg.
I also expect the CC to focus on RD development - compounds, schedules, objectives, etc. I believe that the recent financing was motivated primarily by the opportunity to rapidly clinically advance compounds with RD. After reading about the number of out-of-hospital procedures where these compounds are used, I believe that the market is potentially very large, and that use of Ampakines for this indication will have the largest mid-term SP impact. At a lower level, after
Barkdog pointed out the widespread use of benzodiazepines concurrent with opioid analgesics, I am interested hear how Ampakines interact with these CNS depressants (though I doubt that such information will/should be shared at this time). I may be the only one on this board who is very excited by the possibilities for Ampakines for this indication, but I really believe that it will springboard Ampakine development for other, more important indications.
Unfortunately I don't think I'll be able to participate in the CC, since I fully expect a significant discussion on this subject.
Thanks,
Karl
How widespread the usage of an RD-risk-free analgesic would rationally depend on a cost/benefit analysis. However, perceptions and publicity often overwelm rationality in cases that involve public safety. I remember reading about a woman that recently died during plastic surgery in at a doctor's office, not in a hospital setting. It sounds like she suffered RD during concsious sedation. She was a lawyer. I finally found the link:
http://www.azstarnet.com/sn/health/168642
If having a formulation that allows for RD-risk-free conscious sedation means the difference between a law preventing out-of-hospital conscious sedation and allowing it, then there is an obvious market which may also be underestimated.
Thanks,
Karl
barkdog,
Thank you for the response. As you mentioned, Versed also causes respiratory depression. The following is from http://www.drugs.com/pro/midazolam.html
Adverse Reactions
See WARNINGS concerning serious cardiorespiratory events and possible paradoxical reactions. Fluctuations in vital signs were the most frequently seen findings following parenteral administration of Midazolam hydrochloride in adults and included decreased tidal volume and/or respiratory rate decrease (23.3% of patients following IV and 10.8% of patients following IM administration) and apnea (15.4% of patients following IV administration), as well as variations in blood pressure and pulse rate. The majority of serious adverse effects, particularly those associated with oxygenation and ventilation, have been reported when Midazolam hydrochloride is administered with other medications capable of depressing the central nervous system. The incidence of such events is higher in patients undergoing procedures involving the airway without the protective effect of an endotracheal tube (e.g., upper endoscopy and dental procedures).
This makes me wonder if Ampakines would interfere with some of the desired effects of benzodiazepines. In addition to versed, I think other benzodiazepines, like Diazepam, are sometimes given prior to some procedures to induce muscle relaxation and to surpress pre-operative axiety and surpress recall of what happened during the procedure. It would be really interesting if Ampakines only inhibited specific effects. For what it's worth, the original Cortex press release for RD mentioned preventing both opioid and barbituate induced RD.
Thanks, again.
Karl
atheroprevent, I took a quick look, and could not find good statistics on fentanyl use. But even if we just look at typical IV use in medical procedures, the numbers are pretty impressive. This site sells information on surical procedures in the US: http://www.ussurgerystatistics.com/ They report that in 2004, there were more than 50M medical procedures, including more than 30M surgical procedures and more than 8M endoscopies. I would guess that fentanyl or something similar was used with most of these procedures, for perioperative, or postoperative pain management or conscious sedation. I also saw somewhere (I couldn't relocate the web site...) that the fentanyl cost (yes, it is a generic)was $40 - $80 / patient for cardiac surgery. If we just estimate at 25M IV doses per year with a cost of $100 / procedure... This is pretty crude, and I have no idea if ampakines can be produced at a cost that could support these prices, but the numbers get big in a hurry. Looking at all the other applications for pain management, the numbers get really big. The question is: can ampakines be produced at low enough cost to justify their inclusion for every opioid analgesic application. If the cost is low (100% or less increase in cost), then I have to believe that there is a compelling reason for an RD-risk-free version to be used almost exclusively.
Sorry for the rambling - I'm just trying to get us to think more on this subject. I think the potential is much bigger than we've been considering.
We've also been belly-aching about the strategy that the company has been taking, stated or unstated. For what it's worth, my take is that Dr. Stoll is being very careful not to get into a position where he has to give away the farm at low-ball pricing - either out-licensing, partnering, or sale of the whole company. I think he sees RD as a way to begin to get some reliable revenue for the company without selling the farm - revenue that would accelerate the development of treatment of other indications, so that any partnership or out-licensing would be priced at a much lower risk/reward ratio. I think that the BP deals he was hoping for are now looking a lot less desirable at their current price, and that he is taking the opportunity to boost that price significantly at the cost of the current SP with the additional dilution.
There has been some discussion of the potential market for Ampakines in respiratory depression associated with the use of opioid analgesics. I think we may be seriously underestimating the potential market for this indication. While I think the incidence of fatal RD is pretty low, and mostly restricted to opioid-naive patients, the incidence of some level of RD is relatively high. I couldn't find good numbers, but this Univ of MD site ( http://www.umm.edu/altmed/drugs/fentanyl-053600.htm#Adverse%20Reactions )lists the incidence of RD with Fentanyl at greater than 10%. This tells me that at least for this opioid formulation (and perhaps for most current opioid analgesics)that if an RD risk-free formulation were available, it would be the only one prescribed. In that case the market is huge. Just imagine every Fentanyl dose accompanied by an Ampakine. I haven't got a clue as to the revenues associated with such an assumption, much less the cost of manufacturing an Ampakine. My guess would be that a 100% increase in the cost of Fentanyl for RD-risk-free-Fentanyl would be acceptable. I'm sure folks like dew, neuro, and gfp could come up with some numbers.
money4retirement,
Thank you. I intended to type: ...the ampakines did not compromise the analgesic effects of the opioids. That's what I get for trying to work and follow COR at the same time!
I did not listen to today's presentation, but I would be surprised that he did not mention that the ampakines did compromise the analgesic effects of the opioids. It is clearly stated in the original press release:
Cortex and The University of Alberta complete patent license agreement
— Rights Could Broaden the Use of AMPAKINE® Compounds to prevent Opiate- and Barbiturate-Induced Respiratory Depression —
IRVINE, CA and Edmonton, AB (May 10, 2007) The Board of Directors of Cortex Pharmaceuticals, Inc. (AMEX:COR) and TEC Edmonton on behalf of The Governors of the University of Alberta jointly announced that they have entered into an exclusive Patent License Agreement that could broaden the use of Cortex’s AMPAKINE® technology to prevent and treat opiate- and barbiturate-induced respiratory depression. University of Alberta Professor Dr. John J. Greer has demonstrated in both in vitro and in vivo animal models that selected AMPAKINE compounds can enhance respiratory drive and breathing rhythm at the level of the brainstem. While it has been reported that only 0.5%–1.2% of total adverse drug events caused by prescription medications are respiratory in nature, these account for 25%–30% of drug-induced deaths. Opiates and barbiturates are the primary drugs classes responsible for these effects. These events usually occur during the dose adjustment period or when different central nervous depressants are taken together without checking with a pharmacist or physician.
“This filed patent application by Dr. Greer describes a method by which an AMPAKINE compound can reverse the respiratory depression associated with classes of commonly prescribed opiate analgesics, such as codeine, oxycodone, fentanyl, morphine, methadone, pentazocine, butorphanol, buprenorphine, and sedative drugs called barbiturates such as, phenobarbital. Dr Greer has demonstrated that the respiratory depression induced by these agents can be reversed or prevented with an AMPAKINE, without a reduction of pain relief or sedation,” explained Roger G. Stoll, Ph.D., Cortex’s Chairman, President and Chief Executive Officer. “This opens up the real possibility of combining an AMPAKINE compound with the commonly prescribed barbiturates or opiates to reduce the mortality caused by these adverse reactions.”
Dr. Greer added: “Clinicians are currently concerned that the only means of countering opiate induced respiratory depression is to give an opiate receptor antagonist. This can lead to considerable problems managing pain. AMPAKINE compounds may allow for more effective use of opiate analgesics.”
Under the terms of the Agreement, the University will receive an undisclosed upfront payment, milestones, and royalties, and Dr. Greer will get multiple years of support to expand this research.
About Dr. Greer, The University of Alberta and TEC Edmonton
Dr. John J. Greer is a Professor in the Department of Physiology, Faculty of Medicine& Dentistry, at the University of Alberta and Scientist of the Alberta Heritage Foundation for Medical Research. He is affiliated with the University’s Centre for Neuroscience, the Perinatal Research Centre and the Women and Children's Health Research Institute. His research is directed toward providing fundamental insights into the development of the neuromuscular control of respiration. Dr. Greer’s study of the effects of AMPAKINE compounds on respiration was published in the Dec. 15, 2006 issue of the American Journal of Respiratory and Critical Care Medicine.
Since 1908, the University of Alberta has remained committed to the pursuit of new knowledge and its dissemination to the world. As one of Canada's top research-intensive universities, it received over $420 million in externally funded research in 2006-07. The University is the largest research institution in the province of Alberta with nearly 13,000 academic and support staff and over 36,000 students at its campus located in the provincial capital, Edmonton. Its international reputation grows with many leading-edge achievements, including the “Edmonton Protocol” treatment for Type 1 diabetes, the pioneering work of the National Institute for Nanotechnology and the world’s first antiviral treatment for hepatitis B.
TEC Edmonton acts as the technology transfer office for the University of Alberta. A joint venture created in 2004 by the University of Alberta and Edmonton Economic Development Corporation, TEC Edmonton is committed to providing investors with access to high-growth, advanced-technology opportunities in the form of new inventions, innovations or early stage ventures created in the Edmonton region.
University Contact: Jason Darrah, Communications Manager, TEC Edmonton 780.492.3129 www.TECedmonton.com
About Cortex
Cortex, located in Irvine, California, is a neuroscience company focused on novel drug therapies for neurological and psychiatric disorders. The Company is pioneering a class of proprietary pharmaceuticals called AMPAKINE® compounds, which act to increase the strength of signals at connections between brain cells. The loss of these connections is thought to be responsible for memory and behavior problems in Alzheimer’s disease. Many psychiatric diseases, including schizophrenia, occur as a result of imbalances in the brain’s neurotransmitter system. These imbalances may be improved by using the AMPAKINE technology. Cortex has alliances with N.V. Organon (Organon Biosciences) for the treatment of schizophrenia and depression and with Les Laboratoires Servier for the development of AMPAKINE compounds to treat the neurodegenerative effects associated with aging and disease, including Mild Cognitive Impairment, Alzheimer's disease and anxiety disorders. On March 12, 2007, Akzo Nobel, Organon’s parent company, announced the proposed sale of Organon to Schering-Plough, which is expected to be completed by the end of 2007. For additional information regarding Cortex, please visit Cortex Pharmaceuticals’
Website at www.cortexpharm.com.
Note — This press release contains forward-looking statements anticipating results of future research and development activities and the possible clinical uses of AMPAKINE compounds, all of which are difficult or impossible to predict accurately and many of which are beyond the control of Cortex, all as more fully described in the risk factors and other matters set forth in Cortex's Annual Report on Form 10-K for the year ended December 31, 2006, and Cortex's other filings with the Securities and Exchange Commission. Cortex disclaims any intent or obligation to update any forward-looking statements.
Contacts:
Roger G. Stoll, Ph.D.
Chairman, President and CEO
Cortex Pharmaceuticals, Inc.
(949) 727-3157
Erika Moran/Dian Griesel, Ph.D.
The Investor Relations Group
(212) 825-3210
XTLB announced the inlicensing bicifadine in mid-January and rose sharply after the news. Now that the company has discontinued a line of Hep-C drugs after two failed to show any efficacy in trials. One might argue that their inlicensing was good protection for such a failure.
I'm all over gfp's "in chaos there is opportunity", jerrydylan's "dark days of opportunity", and tradermann's (?) "buy panic; sell euphoria", but in the process I'm also confirming neuro's observation that I know when to buy, but haven't got a clue at figuring out when to sell.