That is a VERY difficult calculation, but here is my best try to airball some numbers.

Let us say that a rational discount model is 20%/y. Then the non-infringing present value would be 5*N (here N is the present run rate).

DD is starting with 2 year hold off, this will yield N*1.8.

The remainder is hard to guess, but if I had to I would put 1*N up.

So DD is settling for 2.8 on 5.

Let us be real, if it goes to court anything can happen. Greed is good, but walking out the door a winner is better.

Unless I am mistaken, intent does not play in basic damages, only treble damages.

EDIT: missed you said punitive, I agree that could be off the table.

I disagree.

If they infringed in the submission only, they would be safe by the literal law, but clearly not by the intent of the law.

Part of the basis for the exemption was that it could never harm the patent owner during the life of the patent, and clearly this is false here.

Furthermore, it was obvious that the exclusion was intended to be for patents on the invention being submitted, and not every patent in existence (which is what A is arguing).

Courts do look at intent the law.

I would put the odds at well over 50% that if hey infringed in the submission the courts final appeal decision will go to MNTA.

Obviously Amphastar was blindsided else they would have been ready for an immediate launch as Sandoz was.

If the sponsor was blindsided, how can anybody else outside of the FDA expect to forsee it?

CSLN: RFA effectivness

To what extent might this be improving over time based on both advances in RFA itself and imaging technology (likely more the latter)?

FWIW, I would think the drug has a decent chance of working but the numbers game is a complete comedy.

OT:

The Maddoff case is the perfect example of why it is more complicated than "suckers".

Much of the client base was either WS or got hooked up through WS. So how could these investors not see the problem?

Answer, they did realize that something was bogus. The rumor going around had been that he was front-running his fund trades through his MM outfit on the next floor. Obviously illegal, but it would turn a nice profit if being done.

So to a large extent the investors were not "suckers", but greedy investors of low ethics who were willing to profit from an illegal scheme.

That they had the wrong scam does not change their motives.

It is greed and lack of ethics, as much as sucker'ness, that allows these to flourish. And that will never change.

Clark would likely site CTIC's STELLAR trials as a prime example of this.

Nobody can prove what the issue was, but everybody 'knows' the problem was that they were admitting ineligible patients in order for them to get free quality care.

Since the trials are often for late stage only, if the validation of the entrance requirements are slack at these E-EU sites then the patients will be healthier.

I don’t get your logic. Unless a new CMC module is submitted and approved, Amphastar has to manufacture commercial Lovenox in the same manner as in the CMC section of its ANDA.

Hypothetical example:

Suppose I discover via MNTA's tech that L is pure water. I am certain that I could get a CMC though that makes said product.

I do agree with you that if A needed to use MNTA's tech to characterize their own process (run time) then MNTA is home free.

What is your rationale for saying this?

Don't know about Pete, but my rationale is very simple.

To get FDA approval you state that L is X and aL is also X.

To manufacture you state that aL is X.

As to how much easier the latter is, I do not have any clue. But it is clearly easier to some extent.

I personally think that reading of the statute goes beyond the intent of the law, but it is still an argument that MNTA will have to deal with.

Yes and no.

If Amphastar is infringing in the ongoing process then the clause would not apply.

It is interesting to note that A used the phrase (paraphrasing) "if we are infringing ...". They might be trying to claim with that something far beyond the written statute.

If A only infringed in the ANDA then I agree the case is far more difficult. Though I agree the intent was that the orriginal drug can be used to prep the ANDA, this is a much harder path.

CLSN: (99.9%) I guess they're quite confident. lol.

Given enough 9's one can cover any mean between 0 and max.

0 is obtained by all patients who event do so day 1, no other events (the trial is still enrolling, so yes this is possible).

Max is when the first N enrollees all event at the interim, also no other events.


OTOH, I am 99.9% confident that the authors are completely full of sh**.

RE: Depo and Gralise

There are quite a few drugs used as of now.

See:these guys.

As individual characteristics determine which works best, Galise is only going to get a bit of this market. If you believe wiki, the world wide market is around $650M.

EDIT: Also Horizant is already on the market and I doubt the label would matter much here where docs are already using gabapentin anyway.

If it's only going to be a high single-digit royalty, then MNTA should roll the dice on landing a permanent injunction. That's too little in return (single-digit royalty) in exchange for foregoing what would be huge upside for MNTA if they were to win a PI against Amphastar.

I agree. Also one must consider NVS who would have no reason at all to agree with this deal. NVS would need either a delay or a portion of the royalties to sign off.

I tend to think we will go on until a PI decision is issued. We can rethink then.

To continue your analogy:

Amphastar uses techniques that infringe MNTA's patents to demonstrate sameness, and using these techniques, they get approval. But they also show that if they monitor their 7 (non-infringing) elves closely, they always have sameness, and going forward they manufacture using these 7 elves only.

Possibly, but very unclear and I personally doubt it would fly. The problem is that you now gave a second level of indirection in establishing "sameness". I suspect the FDA would want to see some level of QA that directly establishes the sameness of the product.

MNTA: Sanofi is proof that this is possible.

I disagree.

Sanofi has to show that their process is reasonably the same as that which was approved. There is no reason to assume they have to be able to characterize Lovenox to any substantial degree. Furthermore, I seriously doubt they did characterize to anywhere near the degree the FDA now expects.

A generic can not possibly match the S-A process, so they have the much harder path of proving the output is the same.

EDIT: If somebody wants to run trials and create a branded generic then that could easily be done w/o infringing.

No prediction on PPS here at all, but the PPS drivers you state do not exist in my book.

The sales will be so constrained that the numbers will not matter. By spring of '12 they are looking at 3-5 million in sales at best. This is not going to drive the price.

Acme is not going to be approved in '12. They have to agree on a trial, run the trial, submit a BLA and then wait 10 months. '14 is a better guess.

The only real driver would be a concrete plan for marketing and production. Then numbers to back it, but that also would be more like late '12 at best.

MNTA: Preliminary Injunction, will this not be a huge decision?

If the Judge is to grant the PI then MNTA will have a few years of sole generic status. Additionally, the odds of winning the case will look better.

Unless I am missing something, MNTA with a PI in place should easily be back in the 20's (and arguably higher).

MNTA: The sealed bit of this case must hold a partial key to a final determination.

The MNTA sealed documents are most likely the contract terms (which would go to damages). There is nothing else that MNTA would know that is not public.

On 2), I envision that 100% of the hypothesized 20% royalty on Amphastar’s sales goes to MNTA. The patents in question belong to MNTA, not the NVS/MNTA JV; moreover, post-2014, NVS benefits indirectly by keeping a larger proportion of the NVS/MNTA JV’s profits.

I agree with the 100% to MNTA, but based on your second argument.

NVS does have an exclusive license on the patents, thus the fact that MNTA owns them does not matter.

....and two weeks gets us another $9-10 million.

No, Amphastar is not launching in the next month or so.

Not only do they have to solve whatever issue they initially had (hep supply?), but they will need to get a well done legal opinion to protect them from treble damages (at least Watson will insist on this).

The important point of this is that the Judge is still open to the PI, which would be huge.

MNTA - What do you make of yesterday's court order?

The "defendants relevant conduct" clearly means a launch.

So the Judge seams to be saying that he does not see a launch in the next couple weeks, and if they can agree on that then there is no need to rush on an injunction.

Maybe, but let us run the numbers some more.

They are on record (I believe) in saying that the current facilities can handle 5k sales over the next 18 months. Let us assume these are enough employees to handle the task, and further they could do 5k in a year.

How many employees? Let us go with 50. Obviously some who were hired are not going to scale with size, but they also had some on board. They already had on all the high level people that were needed to get the plant past FDA.

So we have 50 employees generating about $12.5M of revenue. These are not burger slapers, so assume they cost $150k/y (employees cost is much more than salary).

Biotech manufacturing is not generally a labour intensive business. Yet we have half the revenue already allocated there.

There are certainly plenty of arguments that can be made against this post, but I could make stronger arguments on my side also. One has to admit that the cost of sales issue is in play.

I do think this stuff could sell. Hell, botox is completely absurd and it sells. Never underestimate vanity and greed.

But until the company makes some serious effort to address the finacials I doubt you will see much of a PPS boost.

Perhaps LLY’s best bet is to position Cialis as the drug of choice for men who have both ED and BPH.

I would suspect many men who need to take a drug for BPH would appreciate the "side effect" even if they do not have much of an ED issue. There is presently heavy use of ED drugs by those who do not need them, but enjoy the benefit anyway.

Many might not go out and start using Cialis "recreationally", but might very well let it factor into a decision on a drug they honestly need to take.

OT: ... Jobs, IMO, created things that they envisioned in sci-fi movies. He made it real.

Jobs was always "the man" when it came to human / computer interface (whatever what it might have have been called over his lifetime).

He was the one who realized that it was not just making it easy, but also making it pretty/exciting/impressive/...

MNTA: thanks for the update, other than common sense,anything preventing ampastar launch until a judge has ruled on motion?

They announced at approval time that they were not ready to launch. I doubt they would have used the term Q4 when they were expecting to launch in a few weeks.

I would not be surprised if they do not have source heparin in any real quantity (and the "lab" shipment does not count).

ARRY:I'm just trying to understand why they changed the primary outcome. What would be your opinion?

My guess is that they were taking a shot on using the trial for the basis of an NDA if OS had hit. Like a trial one calls a P2/3 where the intent is to gain the needed data to carry on the program, but it could be registrational if all works.

So that failed, but they still have all the data they would have had (maybe even a little more if Clark is correct).

The nature of the trial does not change the drug.

How do you know when the primary endpoint was changed? If you are going off clinicaltrials.gov that can be very inacurate.

I do question Clark's crossover theory on other grounds though. There are plenty of ways to design trials that would get the OS data clean w/o making it the primary. A simple 12(?) month landmark PFS would do this.

MNTA: Huge difference between a PI and a TRO

I assume a TRO would be lifted as soon as the PI was ruled on?

If so a few months on the TRO is nothing. But the prospects of 1-2 years on a PI would pop the share price $4 or so.

Of course a court win on the actual suit might be worth another 10 cents.

ARRY: What am I missing here?

A P2 trial is not evaluated like a P3 in terms of the primary endpoint being a brightline on failure.

A P2 provides data on how and if to run a P3. If the OS was trending well it is very possible that they would run with a P3 based on PFS and RR.

My point is that they have the exact same data, stat sig PFS/RR not OS, that they would have had if PFS had been the primary (except for the stat purists who insist the secondaries do not matter when the primary failed).

So the decision to go should be the same as if the trial had PFS as the primary and the news was "it worked".

I.E., they are no worse off.

ARRY: I wonder if they were really expecting OS to hit in a trial this size anyway.

The decision for go/no-go is not affected by the structure of the endpoints, but if by some chance OS had hit then they might have registrational data.

So at a cost of a minor delay in results they get a free shot on goal.

EDIT: I agree with all that the PR means little to nothing w/o numbers.

MNTA, from acgoods notes on the CC:

So if Amphastar launches and loses the case, we have some very interesting possibilities.The point being that MNTA is "permanently" (and very substantially) damaged even with aL pulled off the market.

Any solution which makes MNTA whole and does not interfere with the Sandoz/MNTA contract would seam to cost Amphastar a fortune. Yes, Sandoz could negotiate, but why should they?

A negotiated deal before the decision avoids this, but the negotiating position is much stronger if the damages could be that large.

So, does this change the "launch-at-risk" odds? Does it change the odds of a royalty significantly greater than chump change?

Q for the lawyers. Can the Judge just tear up the terms of the Sandoz/MNTA contract if no other solution exists?

Would the script allow for substitution of a non approved (for the indication) generic? Is this state by state, doc by doc, or what?

But a generic could not get the label for many years. I assume that is worth a good chunk.

There is also a question of how much mfg capacity they have, which they have been very tight lipped about. All they say is that it will be out the their headquarters, and will support the launch. Since they refuse to discuss numbers, nobody really knows what this means.

The London facility, designed to support commercialization, was able to support 5K/y at it's peak. Might be good to track down it's size and see how it compares.

it's the date of the patent application, not the date the patent was issued

I understand the issue date does not matter.

I have always thought (in US law) that the key date is when they can document the invention, which can preclude the submission by a good bit.

But if they are using a process that they never got a patent on and that violates MNTA's patented process, I assume timing wouldn't be an issue.

I disagree. If they have a documented process that predates the MNTA invention then they will win the case.

If they are using tech that infringes, this could be the first bright line. The evidence will be clear, did they change the process (and that includes proof of sameness) after the MNTA invention?

One issue for MNTA here is timing - could be that the Amphastar process predates the MNTA patents.

It might be well documented in the FDA CMC paperwork, so the issue could be at the trial.

As a technical point, is it not the date of the MNTA invention, and not the patent application, that matters?

OXGN: They compared to 50 years of historical data?

That really goes past the bounds of the usual historical retro analysis.

I would suspect that for virtually every indaction out there SOC+Placebo in present day trials would beat SOC over 50 years.

This isn't just hyping weak data, it is pure intent do decieve.

Where will the data be presented? Rodman and Renshaw?

Re:

Yes, they are iShares. They invest in the composition of just about every index ever created.

One note is that many think they evenly weight across the board. But in the small caps this does not always work because some are so low volume they can not get in/out. So to some extent in these issues they additionally weighted by volume on some manner.

This creates some really dumb posts on Y! etc.

- " $DNDN $JNJ - As med onc treating ProstateCA, we use these not either/or but sequentially. Cost/value hurts Provenge more."

I think would interpret that to mean that despite the present labels, Provenge will be used 4th line and Aberitrone will be used 3rd line.

If true, DNDN is toast.