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...and the last time we had positive trial results, they were announced on Monday, July 11, 2011.
http://www.titanpharm.com/press/2011/110711-Probuphine-phase3-data.htm
Well, there are no guaranties in life, but they obviously now have the topline results in hand. If they were bad, there would be a strong justification to release after market close on a Friday. If good, conventional wisdom is that you waste "positive" PR on a Friday so you wait until Monday and get the market buzzing.
WOO HOO!!!!!
You don't release bad results pre-market on a Monday!!!!
http://finance.yahoo.com/news/titan-pharmaceuticals-schedules-conference-call-203539681.html
Great article
My understanding is that the DEA harassment problem is even worse when it comes to prescriptions for chronic pain. An implant or depot injection is an immediate way to solve the issue.
Eh...
A little step backwards doesn't bother me. Shorts may be trying to create some downward momentum, but I think its more likely that some are happy with their return thusfar this year and figure there will be time to buy in after results are announced.
We will see the same thing, on a much larger scale, once the NDA is resubmitted to the FDA.
Long Term
Hope you're right about the long-term...this is over a year old, but they appear to share your opinion.
By 2017, the buprenorphine implant will emerge as the gold-standard therapy in our Drug Comparator Model because of its superior clinical profile over the key current therapies we evaluated.
http://decisionresources.com/Products-and-Services/Report?r=dbascg0114
Well, define "the future." Looking in my crystal ball, I see that when (if) probuphine is approved, there will be a lot of interest in Titan, but that will be mitigated by its OTC status and the fact that a lot of folks who bought in at less than a dollar will be selling as well. I think $2 to $2.50 is likely after approval.
Soon after approval we should get uplisted to Nasdaq, which may not do much for investor interest, but it will end the OTCBB trading nonsense to which we've all become accustomed. EU marketing deals for probuphine will solidify the base, and perhaps continue to drive the price up.
Thereafter, price will be affected by (a) sales numbers for probuphine (and royalties to TTNP), (b) whether Braeburn decides to immediately go for an sNDA for probuphine/chronic pain, (c) the initiation (and trial design) for Pro Neura for Parkinsons (they are using the 505(b)(2) pathway which could mean a Phase I/II that would lead directly to Phase III trials) and (d) the mystery drug alluded to in the conference call, which they claimed would be in "the clinic" (i.e., Phase I/II) two or three quarters after Pro Neura for Parkinson's is initiated.
If, during 2016, Titan is uplisted to a real exchange, initial probuphine sales meet expectations (which are low in my opinion), Braeburn commences a Phase III for chronic pain and Titan commences a Phase I/II for Pro Neura for Parkinsons...then I believe the PPS will be over $5.00.
Heard this story on NPR news this morning...
http://www.npr.org/2015/05/22/405936514/in-americas-heartland-heroin-crisis-is-hitting-too-close-to-home
Oh well, in the words of the great stock swindler Daniel Drew, "He who sells what isn't his'n, must buy it back or go to prison."
Vintage: Thanks.
Didn't know the meeting had been set up. I am planning on buying back in, but for now I will give up potential gains for a little certainty on just what the heck is going on with this stock. That being said, I'd be happy for you all if a $5 per share (or more) offer came in. You deserve to be rewarded for your patience.
Hmmm
Haven't posted for awhile because I sold once I lost 10% of my original investment after holding for 18 months (I bought at $1.14). I couldn't understand why the price was falling after the IDIQ was issued, even given the debt situation.
It's all just reading tea leaves, but things are starting to look attractive again with the European sales.
I don't think a buyout is the reason for the board member's actions. If a buyer wanted them gone, it would be done already. The 8-K says they are refusing to stand for re-election at the next annual meeting...and as far as I know, no proxy statement for an annual meeting has been filed, but perhaps one is being contemplated. Holding an annual meeting is a requirement for Nasdaq listing. Nasdaq also has pretty strict director independence requirements as well. So maybe they are leaving in anticipation of uplisting (and possibly a reverse split to get the price above $2 to satisfy that Nasdaq requirement?). Wouldn't think its a disagreement with management, because these are the same guys that fired Glenn and replaced him with McMann.
Don't know what to make of it all, but I do like THIS
"FDA will take a flexible, adaptive approach to the evaluation and labeling of abuse-deterrent opioid products"
Not sure what to make of it all, but I like this...
"FDA will take a flexible, adaptive approach to the evaluation and labeling of abuse-deterrent opioid products"
I missed this, so I apologize if its old news.
http://www.fda.gov/downloads/drugs/guidancecomplianceregulatoryinformation/guidances/ucm334743.pdf
Truth, as others have said,
thank you for your diligence in providing background and context to the market that probuphine, if approved, will be serving. Assuming good results and an NDA re-filed by August-September, I would expect the FDA to take less than the full 6 months to approve in light of the magnitude of the epidemic.
In December, the FDA is also to decide on whether to approve BDSI/Endo Sciences BEMA buprenorphine sublingual film for chronic pain. If they approve both Probuphine for opioid abuse and BEMA for chronic pain, it would seem like a no brainer for Braeburn to immediately start on an sNDA for the chronic pain indication...although that would probably take another Phase III (or two). Still, going after the "white whale" of chronic pain would spur a great deal more interest in TTNP.
On the other hand, why would Braeburn do anything on chronic pain (and cause TTNP's share price to rise) before they had bought Titan, if that's what they plan to do? Either way, I'd be ecstatic. Plus, on the clinical trials websites I recently saw some interesting new trials using buprenorphine for treatment-resistant, late onset depression...seniors would be a perfect market for an implant vs. pills/film.
OK, I'm getting ahead of myself. When do those damn Phase III results arrive!!!
I've seen similar notices for a couple of publicly traded "nano-cap" companies (what can I say, I'm a bottom feeder). Basically, DGCL 211 requires a company to hold an annual meeting at least once a year; there is no "penalty" associated with not holding a meeting but the Delaware Code does allow a stockholder to petition the Delaware Chancery Court to order the Company to hold a meeting. Interestingly enough, the Delaware Supreme Court has ruled that attorneys fees are not payable in a shareholder suit unless a breach of fiduciary duty is proven, and so that is why they are including the fiduciary duty language. Not really a huge deal, but TTNP will most likely end up using some of its precious cash to pay some lawyer fees it wouldn't of had to if it just filed an annual proxy statement.
On the authorization of additional shares, I believe there was a covenant in the financing that occurred in late 2014 requiring them to increase the number authorized. Without additional shares, I don't believe there are enough shares authorized to cover all existing convertibles. So while yes, they obviously can use the additional shares authorized to raise capital, and dilute existing equity, the impetus for the increase comes from the terms of their financing.
I share the concern on the ever slipping timeline for Parkinson's. It doesn't appear like there is a lot of oversight on what Titan's management is actually doing, or whether they deliver or not. But candidly, my hope is that Titan would be purchased by Braeburn long before any Phase I would be completed anyway.
Turks
That's my understanding as well. Even after patent expiration, another market entrant would not be able to rely upon Titan's trials to show the efficacy of their implant; instead they would have to conduct their own Phase 1-3's. A very significant barrier to market entry.
Kinda wish someone from Titan/Braeburn had been at this conference:
https://prevention.nih.gov/programs-events/pathways-to-prevention/workshops/opioids-chronic-pain/workshop-resources
Back in the day, the NIH funded part of propubuphine's development for the opioid abuse indication, and because probuphine eliminates many of the risks mentioned at the conference (accidental overdose, addiction, street resale of medication, lack of knowledge/training by prescribing doctor etc), it would have seemed to be a natural add-on.
The conference materials appear to have been prepared with a definite anti-opioid medication slant to them, but interesting the draft report also reflects testimony of many chronic pain sufferers who states opioids provided them their only hope of living a normal life. It appears what they ended up saying was that opioid prescriptions for chronic pain should be reduced, but not ended entirely, and that controls against abuse should be put into effect...segue to probuphine?
With a market size of 44 million, I wonder what the "off-label" sales potential of probuphine would be? I know suboxone has had substantial off label sales for pain.
Buzz...no words of wisdom from me. I realize there are differing opinions on this issue, but I believe DMRJ's sells in volume at the $1.20 to $1.40 range, effectively capping any rally that could spur additional investor interest, and so until that overhang is eliminated, one way or the other, we just have no way of knowing how high Implant could go.
In making any sort of value determination, I think its important to remember Implant is in the ETD space, not EDS. Management has always said their goal was to capture one-third of a $300 million a year market, and I take them at their word on that. There are a lot of soothsayers and prognosticators who post mysterious hints that "those in the know" realize the company's potential is infinitely larger. Well, I'm not in the know, and so I have to go with the guidance management is willing to provide in a public forum rather than one-on-one conversations.
125 million authorized, with 109 million outstanding as of the last 10Q.
I agree that a reverse split is unlikely, but found the confluence of events interesting.
I found it in the S-1 registration statement for the 20 mil financing.
So, at the very least we will have a stockholders meeting by the end of March, which is a positive.
Shareholders Meeting
From Titan's S-1 Registration Statement: "We have agreed to hold a stockholders’ meeting no later than March 31, 2015 to seek stockholder approval to effect a reverse stock split or for an increase in the authorized shares of our common stock."
Curious to me that they would put the split option before the increase in authorized shares option in that sentence. Could a reverse split be in the near future? If their intent is have a reverse split and then uplist to an exchange, perhaps that's why the two new outside directors recently came on board (to satisfy Nasdaq/Amex "independent director" requirements?).
Funny, I looked up the CAM2038 Phase II trials and I thought they covered only opioid dependence. How do they get away with claiming they've conducted Phase I/II for chronic pain?
Well, I get the decision to pursue opioid abuse before chronic pain. It is an easier sell to the FDA: more urgent need, and buprenorphine is the accepted standard of care.
As for whether they are going fishing, well...Braeburn under the license agreement, Braeburn has agreed to "use Commercially Reasonable Efforts to commercialize and Promote Products in the Territory and to perform its obligations under this Agreement." As there is a specific milestone called out for the Chronic Pain indication in the license agreement, its pretty clear to me that a Chronic Pain indication is part of Braeburn's commercialization obligation.
Notably, in the third license amendment, "Commercially Reasonable Efforts" was redefined as "with respect to (a) Braeburn, that degree of skill, effort, expertise, and resources normally used (including the promptness in which such efforts and resources would be applied) consistent with standards generally accepted in the pharmaceutical industry, including with respect to the diligent development, manufacture and commercialization of pharmaceutical products of similar market and profit potential at a similar stage in development or product life as the Product; provided, however, that in determining the level of efforts and resources to be employed, Braeburn shall not be permitted to take into account any Second Product being developed or commercialized by Braeburn or any of its Affiliate."
In other words, the fact that they may be developing other chronic pain products does not affect their obligation to commercialize probuphine for chronic pain.
It sounds like they are fishing, probably relating to the options granted earlier in the year with a $0.70 exercise price. The argument would be they somehow "knew" the IDIQ was in the bag, and therefore, effectively granted themselves options at a lower price without first disseminating material, nonpublic information.
They obviously don't read this board much, because until I saw the press release the last thing I think anyone believed was the order was "in the bag."
Worst case scenario would be the option grants are rescinded and Implant has to pay their legal fees. Nothing that should affect the stock price.
...and despite Braeburn's recent licensing deal with Camarus, probuphine appears to me to be their fastest path forward to the pain market. The Camarus Depot for opioid abuse hasn't started its Phase III yet, and the Camarus Depot for chronic pain is still at Phase I.
Sorry if this is known to you all...but as Braeburn states in its Camarus press release: "According to the National Institute on Drug Abuse (NIDA), 116 million people suffer from chronic pain in the U.S. It is estimated that 44 million are being treated with opioids for moderate or severe pain." With a market of 44 million customers currently using opioids for chronic pain, probuphine sales to one quarter of one percent percent (.0025) of that market would probably equal its peak opioid abuse sales (110,000 x $2250 = $247.5 million).
It seems to me that there might be a path forward on chronic pain that doesn’t involve a full blown Phase III. In 2010, the FDA approved Purdue Pharma’s Butrans Transdermal System for the management of moderate to severe chronic pain in patients requiring a continuous, around-the-clock opioid analgesic for an extended period of time. According to its website, the initial dose of Butrans should equal: 5 mcg/hour if the previous opioid daily dose was 30 mg or less, and 10 mcg/hour if the previous daily dose was 30-80 mg.
Currently, the Phase III Braeburn is conducting on probuphine is testing dosages of buprenorphine at 8 mg or less a day.
So under 505(b)(2), it would seem Braeburn could file an sNDA for probuphine for chronic pain using the efficacy data from Purdue Pharma’s Phase III’s for Butrans and the safety data from the previous TTNP/Braeburn trials? The first step would be meetings with the FDA to gain their support for such an approach, but I speculate those meeting wouldn’t occur until after probuphine was approved?
Actually, I think its the third time they've filed a press release. Funny, when you are building a legal case, why tip off the defendant that you are doing so? It can only hurt you, legally speaking. But if you never intend to file a lawsuit but would like to depress a stock price, then maybe there is some logic to it.
I would really like to know whether Smiths or Morpho is a client of that firm. Wouldn't that be a coincidence?
Parks and Pain
Maybe an FDA expert out there could help me with a question or two…
From their latest prospectus, it appears that with respect to Pro Neura for Parkinsons, TTNP intends to rely on the FDCA Section 505(b)(2) pathway in order to use data in the public domain or the FDA’s prior conclusions regarding the safety and effectiveness of ropinirole. I understand the sentence, but not its impact. Does that mean TTNP would only have to show that Pro Neura can deliver a similar dosage of ropinrole in a safe and effective manner? If so, what trials could be eliminated (Phase I, II or III)?
Also, couldn’t Section 505(b)(2) also be used for probuphine with respect to chronic pain? Buprenorphine is already approved for use with chronic pain (I know for sure a patch has been approved), and so perhaps TTNP could use its opioid abuse safety data, rely on the FDA’s previous conclusions regarding drug efficacy and then run a single Phase I type “bridging study” show probuphine implants could deliver bioequivalent plasma levels of bupe?
http://www.camargopharma.com/Userfiles/white-paper/Cmrgo_WhitePaperApprovalPthwy_VFb.pdf
My alternative to buy-out fantasy...appropriate parties should take their blood pressure medicine.
1. Conduct a 5 for 1 reverse stock split, reducing the outstanding capital stock from 70,000,000 shares to 14,000,000.
2. Market doesn’t like reverse stock splits, so assume a 30% haircut on stock value. 5 shares worth $6.00 at $1.20 now equal 1 share worth $4.20. Uplist to Nasdaq.
3. Under anti-dilution adjustment procedures, DMRJ’s $5.6 million 8 cent conversion note is now a $.40 cent conversion note, convertible into 14 million shares.
4. Assume investor group of 4 venture funds puts in $120 million ($30 million each). They receive a total of 14 million shares of common (3.5 million each) valued at $2.95 (another 30% haircut) plus an aggregate of $80 million in secured promissory notes ($20 million each) bearing interest at 8%. The proceeds are used to buy out BAM and DMRJ as follows: $5.6 Million/$0.08 Conversion Note (converts at $0.08) =$58.8 million, $12 Million/$1.08 Conversion Note=$14.5 million, $12 Million/$1.18 Conversion Note=$14.0 million, BAM Debt =$20 million and other debt =$8 million. Remainder of proceeds used for working capital.
5. Assume $100 million of sales in the next fiscal year. Margin of 45% leaves you with $45 million, less R&D ($5.0 million), SG&A ($15.0 million) and debt service ($6.5 million), for net income of $19.5 million.
6. With 28 million shares outstanding, EPS is $0.70. Debt-free, IMSC is now a market darling, so we get a 40X earnings valuation, or $28 a share ($784.0 million total).
7. So, 5 shares of Implant worth $6.00 today at $1.20 per share would be worth $4.20 ($0.84 per share) after #2 and probably $3.00 or so ($0.60 per share) after #4 but $28.00 at the end of FY 2016 (the equivalent of $5.60 today).
That would make sense: wait to move until probuphine is approved but before sales begin to reach levels where significant milestones are required. Not sure, however, how pro neura (for Parkinsons or other indications) fits into their overall portfolio/focus, but they could always sell that off later.
Although I understand the waiting on their part, I really wish they would do something on pain, however. It always seems to be mentioned as a possibility, but it would be great to hear what, if any, work has been done to push the ball forward.
I have heard the inability to properly titrate as an objection to the use of a subcutaneous implant for the treatment of chronic pain. Still, there would seem to be a significant portion of the market for whom the risk of accidental overdose would outweigh that issue...particularly the elderly.
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2682375/
So, if I understand it correctly, because buprenorphine was approved in the EU prior to 2004 and probuphine is really a drug delivery device (not a new "active substance"), TTNP cannot file for approval of buprenorphine under the EU drug approval “centralized procedure.”
So, they will need to use either the “decentralized procedure” (essentially filing in all target market countries at the same time) or the “mutual recognition procedure” (filing in one country, and, after approval, requesting other countries to approve the drug based on that approval).
So…I don’t see TTNP having the resources or inclination to conduct this approval process alone (i.e., without a partner). I also think its in TTNP’s best interest to have the drug launched in Europe at substantially the same time as it is launched in the United States.
I think we see an out-licensing of the EU rights to probuphine in the first half of 2015, hopefully with a corresponding upfront payment.
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3149704/
I tend to agree, perhaps a little higher (25%). From what I've been able to uncover, the upfront payments for licensing deals of approved drugs tend to be a lot higher, which makes sense.
Anyone have a guess...what would the royalty rate be for outlicensing probuphine to the EU/Asia. Assuming no more trials were required, Titan would essentially be handing the licensee a product on a silver plate. So what kind of royalty percentage would be customary?
Answering my own question, I think Braeburn will wait until probuphine is approved before pursuing pain. It's not entirely discretionary, as the License Agreement describes a "Commercialization Plan" for Subsequent Indications. It would be interesting to know whether management could tell us whether, per the Commercialization Plan, any chronic pain activities will be undertaken in 2015.
Once (or if) the decision is made to proceed forward, I estimate it will take three years to launch the product:
Product Launch---3 Months following Approval of Subseqent Indication (per License Agreement)
Product Approval---10 Months following acceptance of sNDA (per PDUFA Guidelines)
Submission of sNDA---6 Months following completion of Phase III trials
Phase III Trial(s)---12 Months from Post-FDA meeting to completion
Pre Trial Activities---6 Months Scheduling and conducting FDA meetings, initial trial design, etc.
An acquisition is complicated at this point.
There are two ways to purchase Implant: purchase of the assets, or purchase of stock. A purchase of stock is infinitely more easy to accomplish, and is the method used 99% of the time with public companies.
A purchase of stock can be accomplished in two ways with a public company: (1) sign a merger agreement, and then solicit stockholder consent, or (2) launch a tender offer for the target’s stock. In either scenario, it is necessary to have a grasp on the shares outstanding to be able to determine the price per share being offered to selling stockholders. With Implant, there is no certainty as to the number of shares outstanding given DMRJ’s ability to freely convert its debt into stock.
Thus, any acquisition necessarily requires the acquirer to deal with Implant’s debt (i.e., make a deal with DMRJ). The deal would either be that DMRJ agreed to fully convert at closing, or that DMRJ agreed to refrain from converting (and have its debt bought out at a substantial premium to its face value).
Remember, $2.0 million of the outstanding 8 cent conversion debt cannot be prepaid (convertible into 25 million shares). That is the protection DMRJ built in to the financing structure to prevent an acquirer from eliminating its equity position in one fell swoop.
So, I just don’t see an acquisition being in the cards. To use Buff’s analogies of personal finance, what we need is a “mortgage” (i.e., conventional financing)….because what we have now is credit card debt and a “pay day loan” (i.e., vulture financing).
Hmmm...
This is probably old news, but I have been reacquainting myself with what TTNP has been up to as of late, and I found this 2013 patent application for pro-neura to be used with...chronic pain. It claims priority on the basis of a 2010 provisional application, and so patent protection, if granted, would extend to 2030.
I'm not an expert on the FDA circus, but can anyone see a scenario where Braeburn initiates a Phase III prior to the final thumbs up/down on probuphine?
https://www.google.com/patents/US20130195951?dq=US+20130195951+A1&hl=en&sa=X&ei=diN-VISMGdGuogTj6IKIBw&ved=0CB0Q6AEwAA
There is a covenant in the loan agreement stating that Implant will not cause them to own 5% or more of the outstanding shares. I believe once they own over 5% of the outstanding shares they would have to file a Schedule 13G or 13D, requiring them to report any change in ownership level of 1% or more. Because the covenants in the lending documentation tend to exert control over Implant's conduct, it would most likely be a Schedule 13D.
Once ownership reaches 10%, they become subject to Section 16(b) liability for short swing profits. This disallows trades within six months of each other.
Thanks for the response. Titan is never short of wild cards! And it looks like one wild card is when, if ever, Braeburn would pursue a Phase III for the chronic pain indication. I don't suppose they have tipped their hat at all?
I can understand them waiting until the FDA's review of the probuphine NDA, but if they are trying to put together a complete suite of pain products it appears to me that probuphine has the best chance of making it to market the soonest. And, as the worse case scenario has already happened back in May of 2013, probuphine would appear to offer the least risk of failure (at least the FDA's concerns are a known at this point).