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<<<The best course of action for Elan, in my opinion, would be to cancel the BAP PIII in carriers (I believe Dew suggested this), keep EDT and spend some of the saved trial money selling Tysabri in Crhon's disease, which is sitting at some dismal number of patients right now.>>>
I have to agree to part of this. I do not understand the continuing effort to test carriers for Bap. It could be that the marginal cost to test carriers when they are already going to be running trials for non-carriers is not that great so what the heck. We don't have those numbers.
But strictly from the Phase II results, either Bap worked tremendously well for non-carriers, or there was a lot of selection bias or ad hoc foolery going on. It makes sense to me to do a trial for non-carriers, focus on the hopeful tremendous results. get the drug to market, and sell to 40-60% of the marketplace.
It could even be better than this as Bap may have some valuable prophylactic applications for carriers and non-carriers alike at earlier stages of the disease. I believe that ELN-005 is going to be tested with bio-markers on this basis.
As for pushing tysabri in Crohns, i am a bit leary. The efficacy in crohns is outstanding. No dispute there. The problem is, and please correct me if I'm wrong, that the moderate to severe crohns patient tends to have a background of steroid use and of using immune modulating treatments. All such items that are associated with an increased risk of PML. If the incidence of PML in MS is 1 in 4,000, 1 in 10,000, whatever it is, but less than 1 in 1000 by some good number it would seem, I would think that the incidence when used in crohns would be much higher. Much more careful scrutiny is needed. I like the MM indication much better.
Tinker
There was not even a mention of Bap in the WYE press release, pro or con.
I'll have to see if WYE keeps a archive of its conference call and listen to the last question. There "may" have been some body English?
I think that is the sort of think that helps contribute to the inefficient market.
It is clearly a major happenstance if there is any reduction in WYE's support of BAP at this point. From a regulatory perspective there is nothing to indicate anything other than phase III will go forward. BAP had a much better efficacy and adverse event result in its phase II than most phase IIs that go to phase III.
I do remember when Pfizer stated that were still behind indiplon before pulling the plug about 10 days later or thereabouts if my memory is not skewed.
Tinker
<<<ELN is off 12% on WYE’s disclosure of a delay starting the phase-3 Bap trials in Europe.>>>
Hang on for ELN's earnings conference call on Thursday. This Reuters story (as is characteristic of Reuters stories in regard to smaller biotechs) is skewed straight at ELN's heart. I do not know if this is just their style or what, but I've seen it time and time again with Reuters.
The reporter has no idea as to why the request for more information yet states because of "mixed results". The reporter only states "some" European regulators when it could very well be that most have no issues with it. The reporter does not state that Wyeth stated (to my understanding) that Wyeth is fully behind Bap. And the reporter has not stated the U.S. trials are going on with no delay.
The selling has been on normal volume for ELN lately. And far below the periodic panic selling (sometimes panic buying) that ELN experiences. If there is insider information of something very material it is not wide spread, at least as of yet.
If there is something wrong with BAP I'd sure like to know. This is probably a routine inquiry but some regulators in specific countries in Europe. The phase II Bap results (although disappointing for those who thought it would be something like telaprevir's in regard to miracle efficacy) was clearly successful in that it gave clear indications to move to Phase III. It did not give clear indications that the drug necessarily works (although gave interesting indications) but it did give clear indications that the drug should move forward to phase III.
So what is being asked for would be very interesting. I assume (but won't hold my breath) that ELN will enlighten us at their conference call. I will have to try to find out if Wyeth did any clarification as well on this.
Lack of clarification is not good in a situation like this and implies clarification was not made because it would not help the situation.
Tinker
<<<I think most of the Avonex increase is due to price increases.>>.
I believe this to be the case as well. These things do not happen in a vacuum. Biib is finally starting to emphasize tysabri because it sees its unit growth in Avonex starting to fade, and just behind that is future generic competition.
BIIB has not choice now but to push tysabri up the line to a more mainstream drug. Tysabri is already the only drug clinically proven, by one recent study, and I recall another such study a year or so ago, to demonstrate disease reversal. Each year tysabri appears to create, or at least I think it very probable, that it will create more and more distance between its efficacy and the gradual deterioration for those patients on the CRABS.
MS is a cumulative disease. Even if your not having attacks the disease is still cumulatively attacking your system over time. CRABS do not do much to impact this cumulative attack. They do provide relief from acute attacks, diminishing the attacks to an extent, but they do nothing for disease reversal or really doing much to slow the progression of the disease down.
Each year a tysabri patient, I believe, will show less disease deterioration vs. a CRAB patient, and the curves will just continue to separate.
Now if PML can remain as rare as it has been, and we get more 2, 3, and 4 year safety data, I cannot see tysabri doing anything but growing in marketshare (assuming of course that PML does remain as rare as it has presently demonstrated itself to be).
Tinker
Byetta still has the monotherapy label that the FDA should grant. That should inprove sales somewhat. But with competition from Novo likely to hit the market next year with a 1x a day drug that appears to have at least equal efficacy to byetta, I have to agree. Byetta sales have largely reached a plateau. I still think there is growth left there, but not enough to be very material for a shareholder.
AMLN is primarily an exanitide LAR creature at this point in time. That is where the value is. Byetta is now just a place holder. There is no reason why exanitide LAR should not be approved by early 2010, and it is the superior drug in this market, with 1x a week delivery.
The question then becomes, how simple will this 1x a week delivery be, and how painless. It could be the pain in that one shot a week may exceed all the shots taken by existing byetta as the needle gauge is larger and the delivery system is still being worked on.
At AMLN's current marketcap, should exanitide LAR reach its expected potential, there are multiples of upside to be had here.
3-5 years from now the obesity drugs could dwarf LAR. So it is not necessarily a one drug wonder.
So I am not much influenced by byetta at the moment. It is byetta LAR that is the share driver. Byetta is what it is, and I don't see it growing much past $1 billion in sales, and with ligo coming on the market in a year (probably) I think $1 billion is probably too much of a stretch.
But LAR is clearly the potential game changer, and given that there are already years of experience with byetta, LARS chances of market approval are much better than the usual drug at this stage, and its marketing should prove quicker and easier than an entirely new drug or new class of drugs. Which reduces some risk to an otherwise very risky business model.
Tinker
<<<If the growth rate seen from 2Q08 to 3Q08 is maintained, it will take ten quarters — i.e. until the first quarter of 2011 — for Tysabri sales to reach the 100,000-patient goal set forth by BIIB and ELN.>>>
The 100,000 goal is by the end of 2010, so that would only be off by one quarter. And this taken from a growth rate during the quarter where the 2 new PML cases hit, and a quarter where in Europe there is a lot of holiday vacation being seasonally taken (this would not have an impact on U.S. numbers, but does materially impact EU numbers).
Prior to PML, if you look at the ramp rate, tysabri had started to form a hockey stick curve. The 2 new PML cases put a bit bump in that path.
All depends on the safety profile going forward. It is clear that the incidence of PML is much less than 1 in 1000. It is also clear that if caught early and properly treated, PML can be managed, at least in some patience, making the safety profile relatively better than anticipated.
Further, the publicity is now coming to light that biological drugs of many makes, have their own side effects, many of them PML, and that the deleterious effects of doing nothing or staying on CRABS may be much worse than taking the risk (of a different kind than exists with CRABS) of going on tysabri.
All in all, I think the biggest thing holding tysabri back is Avonex and Biogen's marketing campaign to maximize its sales in both products and minimizing any cannibalization.
Be that as it may, as who knows, 10 PML cases could pop up tomorrow, if things remains as they are, given the numbers you cited, which would only put tysabri one quarter behind in its schedule, the 100,000 patient goal (which will equal ~ $2.5-$3 billion in revenues) is very obtainable from those numbers.
The tysabri numbers actually outperformed the estimates by every analyst that I read, and there were at least 3 or 4 with projections. In fact, the current numbers on tysabri now equals or exceeds the peak estimate of one current analyst by 2013.
Nevertheless, it seems like it is a show me period for ELN. So we shall have to wait to be shown whether this projections will come true or not.
Tinker
Not surprising, and may actually be a positive for ELN long-term. They are not in immediate need of new financing, EDT is cash flow positive, its cash flow should grow into the future and it may get a higher price tag in 2-3 years.
I was actually a little surprised by ELN's decision to sell it off on the auction block. Financially speaking, ELN's management seems to be on the ball (others can debate marketing and crisis handling ability), but ELN knows how to play financing, so I am sure they had their reasons. But no sense letting it go for a fire sale due solely to current adverse economic conditions that are far more likely to improve 2-3 years hence.
Tinker
<<<what does DNA have to do with CIS?>>>
I was not sure what CIS was referring to, but the subject matter of the posts linked to appeared to cover macular degeneration. A field that DNA has a leading drug. A drug that they recently started an interesting pricing and distribution policy with that has the effect of insuring the price of the drug is higher.
It is an interesting market in and of itself, and I thought, given the context of the post, that is what they were referring to.
I must have got it wrong. I would appreciate if you would let me know what CIS stands for as I might actually know something about it, but just not by its acronym.
Thanks.
Tinker
<<<Any comments on the question in #msg-32320771 (How big is the CIS market?)? T.i.a. Dew>>>
I actually should as one of my clients was on the respective teams that actually developed the first two medications for this indication that now compete with DNA. Or shall I say that DNA now competes with. But I have not broached that issue any further with this client. The client knows much more about drug discovery than about commercial opportunities. In fact commercial opportunities are not even in this client's vocabulary. It is all science and development.
I have not personally done more than casually glance at that particular marketplace and noticed some interesting, shall we say, "marketing" with DNA's distribution policy, all for the benefit of the patients of course.
Tinker
<<<From an investment standpoint, this update seems to be essentially neutral. Comments?>>>
Actually, this time, I think positive.
It is clear that the misdiagnosed patient was treated in the worse possible manner. You could not have created a textbook case of worse handling of such a patient. They thought it was a stroke, followed by more tysabri, steroids, and only much later, oh yes, could be PML. By then it was too late.
The other patient, conversely, was treated in the exact manner that textbooks would probably describe. The result very positive.
It is also likely that the first patient should never have been placed on tysabri to begin with except out of desperation treatment.
In any event, I think neurologists, and patients, are going to focus more on the second patient, and now consider that any tysabri induced PML is not necessarily a death sentence but treatable with due diligence. Whether this turns out to be true or not, who knows, but it does give confident neurologists the power to say PML may not be as dangerous as we thought (relatively speaking), and knowledgeable patients the power to say, it is still a risk, but the risk is now somewhat less as I've seen this PML side effect, as rare as it has been, can be treated.
A positive.
But what is more positive is this news on fingolimod. I don't see another MS drug anywhere near to market (talking next 5 years in that context) with anywhere near the efficacy that is less dangerous than tysabri. And in fact, any drug with similar efficacy appears to actually be more dangerous than tysabri. And by the time they get to market, say 3 years from now, I would lay the odds are decently good, that neurologists will be much more comfortable and have much more knowledge as to how to address the PML issue. Meaning, I believe that tysabri will be more in the line of other drugs that have been associated with PML, but you hear almost nothing about by the time these competitive drugs get on the market.
In the meantime, every year there will be a certain percentage of patients who fail CRABS and have the choice, even if scared (whether rationally or not rationally), to choose between tysabri or no treatment at all. Most of these patients will choose tysabri, and by attrition alone on CRABS tysabri use will grow.
All in all good news. Biogen can also sell the latest clinical reports that tysabri had no effect on changing the level of the JC virus in the measured spots in the body. Critics of course will cite that this is not a spinal tap, but I don't see any reason why the virus would only accumulate in the spinal tap measure without also accumulating through the rest of the body. It seems a good proxy, and indication as to why PML has been less frequent then feared. And this study, by the way had 2500 patients, all going over 2 years of treatment, no PML. One would expected 2.5 cases on average. And in every study, or statistical analysis one can do, the incidence of PML has been much less than feared. This study gives us a direct insight as to why that may be.
Whether or not the market sees it this way only time will tell, but that is how it looks to me.
Presently, backing out the EDT business, tysabri is valued at ~$3.5 billion, and the alzheimer program, which is extensive, with many mid to late stage programs that are industry leading, is given what looks like $0 value, perhaps negative value.
Assuming this is the market value for tysabri (otherwise tysabri is being valued even less if Bap and others are given value) that is remarkably little for a drug like tysabri, looking at the competitive environment, that may be the premier MS drug in terms of efficacy and safety for at least a decade, and who knows what it may do in additional indications over this period of time.
Perhaps it is just the residue fear that there are hordes of PML cases waiting to explode. As of now, however, none of the suspected but unconfirmed cases that were discussed by some analysts have been confirmed, and will not be confirmed. Any future PML plague will need to come from future identified patients, and not these patients suspected as of August.
Tinker
Dew,
On the early filing of telaprevir in the second line setting. Perhaps may the thought be that since there is already so much data out there that doctors will not limit use of telaprevir to the second line treatment and will also use it for first line treatment as well?
I mean, if you are a knowledgeable physician, you've followed the clinical results, you already know that telaprevir works, you know its side effects, you can already garner protocols to deal and mimize side effects, and you know as an ABSOLUTE AND UTTER FACT, at least as much as you probably ever will, that the telaprevir regiment, whether first or second line is superior to the existing SoC and by quite a large margin.
As such, it seems more administrative rather then to anyone's medical advantage to postpone approval of the drug on either first or second line pending phase III.
This said, the argument is even stronger to the greater need second line setting, even though the second line data is sparser than the first line data.
Could it very well be that the FDA prefers not to give any anticipated large scale off-label usage, and therefore, on this basis alone, will defer approval for second line usage?
It is the sort of thing that bureaucrats are apt to do, although it makes little practical sense.
Tinker
<<<but you didn’t comment on the one negative I cited: that the GVAX failure may make it harder for DNDN to raise capital between the 9902b interim and final analyses.>>>
I have not looked closely at DNDN's financial situation since the initial NDA so I cannot say how much they need to raise.
With this limitation, I do not believe it will materially hurt DNDN's ability to raise capital. Provenge utilizes a different immunological approach, an approach that has some positive data (at least enticing data that it may work) and now that the competitive threat has been removed, I think greed will overcome sense and DNDN will obtain the capital it needs to move forward.
Heck, the share price is actually up over the last 3 months, and has hardly fallen over the last 5 days. There was a gap down but it quickly recovered. I don't see this materially altering DNDN's ability to raise capital, at least on the downside. I think since the upside is now potentially greater, and that most who did their research did not lump the two drugs together, I really don't see this changing.
It has always been a concern that DNDN would have to mortgage the company to get this drug to market, but I don't think they will necessarily have to do this, nor have to find more than a European partner.
Again, I have not looked closely at DNDN for about a year, but I doubt much has changed from this perspective in that time.
Now, a negative interim look in October, that could hurt the ability to raise capital. I have little confidence that we will see anything but a negative interim result, or at best an indeterminate result in October. It won't prevent DNDN from raising funds, but it could be much more costly after October.
Tinker
The CEGE news is incredibly good news for DNDN. DNDN lost years of time to market with the original application debacle. If provenge is demonstrated to work in the current trial it will go on the market with no real competition for years to come. Hard to say how much provenge will sell but the market is in the billions and DNDN will not need to share it. Just a matter of how large the market will become. Eventually provenge could become used much earlier in the process which may dramatically increase the size of the market even beyond its already sizeable size. All without competition.
So if provenge works, this has given DNDN back years of time that were otherwise lost.
Tinker
Dew suggested that I repost my response from the IV board here as it may draw some higher quality responses. So that is what I am doing:
"Dew,
Of the drugs you have listed, I am not familiar with all of them. However, of these, the ones that I am aware of that may have efficacy similar or perhaps better than tysabri would be fingolimod and campath.
Campath is easily the most dangerous of the drugs. It arguably is more effective than even tysabri, but between campath and tysabri, I don't think the side effect trade offs are necessarily worth considering campath first unless tysabri did not work.
Fingolimod is interesting. I think the efficacy will probably be similar, but probably a bit less. However, its oral delivery system makes it very compelling as its efficacy for most patients shows the potential to be similar to tysabri. Between the two, one has reasons that they may choose fingolimod first. However, there are also safety concerns with findolimod as well. Will more patients die from opportunistic infections? What is the opportunistic infection rate? We just know of the 2 recent fatalities. It still remains to be seen how fingolimod will stack up in the end.
Some of the drugs, like oral copaxone do not have me too concerned. Certainly oral copaxone would significantly ease the use of the drug and may hurt the market for generic copaxone which I know you are very interested in. However, efficacy wise, oral copaxone, injectable copaxone, the efficacy is no different. If you want efficacy you go to tysabri, you go to campath, and it looks like you can go to fingolimod. From what I can see the CRABS have effect, they reduce outbreaks, they can mask symptoms for awhile, but all in all, they do not compare to a tysabri or a campath. As such, if you want copaxone, go with the oral delivery system. But I don't believe it will materially impact tysabri's business no matter how many times Teva calls tysabri "drug induced AIDS". The other drugs I am not familiar with, but Biogen's drug we should probably take seriously as Biogen does want to own this space and they would not have to share BG-12 with Elan.
Tinker"
Dew,
If the second line phase 3 is going to be 48 weeks, and the Prove 3 is 24 weeks, might that not make it more difficult to obtain approval based upon Prove 3 alone when the phase 3 will be testing a different protocol? That just does not sound like an optimal protocol if early approval is a primary goal.
Tinker
No, I have not listened to the CC yet, just reviewed multiple very positive (and zero negative) comments which is not unusual for a charismatic corporate exec. But from the comments I read the conservative tone on early approval was removed.
VRTX – The fact that the interim PROVE-3 numbers for patients who had relapses in the first line are immensely better than the numbers for patients who had non-responses or breakthroughs has the effect of fragmenting the second-line setting and making it harder to handicap what the FDA will request from VRTX.
I had not noticed the start contrast between the 3 arms until I read it closer. I was just so taken with the 73% result and 52% overall.
Given that the largest population with this unmet need is being presented with an extraordinary new option. Half the time and perhaps triple to quadruple the SVR rate, that is going to be awfully hard not to move forward because there are some inter-subgroup differences. Particularly when the SVR results for each subgroup is likely to be 30% or higher.
A cost benefit/analysis strongly and overwhelmingly dictates that the drug, that we know works, and that we have a large safety database on, there are no alternative treatments, and that there is a dire unmet need (albeit it is not pancreatic cancer, but we are talking 10,000 some deaths + how many thousands, to ten thousands of liver transplants each year which is no picnic, and not cheap for medicare) to approve the drug, and further evaluate the drug and the subgroup specifics in the phase 3 trial.
Unlike Provenge, where the cost benefit/analysis was quite compelling given the dire unmet need and horrible death and dearth of alternative treatment, in this case, we know for a practical certainty that the drug works, that it is reasonably safe, and we know that now without any real and reasonable doubt.
As such, that is the rational analysis in this instance. It would not even be controversial, it would not be a negative precedent for the FDA, and it would be a situation where the FDA could boast about moving safe drugs to tackle dire unmet needs to market quickly. I just cannot see this holding accelerated approval back, particularly if all 3 arms turn out SVR 30% or better.
This, even without much political pressure. With political pressure, it becomes even more likely not to make a difference.
But it is the FDA, so you are correct. There may be some serious discussion of this as to why the large distinction between groups. I am sure VRTX is anticipating this and has prepared their responses accordingly. Perhaps we will find out on Wednesday at VRTX's next presentation. Should be interesting.
Tinker
True, SVR12 is less predictable of SVR in this group of patients. However, with a range of figures from 41-73% for prior treatment failure patients, it is almost certain that the final SVR is going to be materially higher than that linked to in your post 26290780, at least in the relapser group, the number is likely to remain very high. It would seem in this study patients had already gone through the treatment, knew what to expect, and were determined to see it through. I would suspect a lower level of drop outs to help account for the higher SVR12 results than even seen in Prove 2 (this without utilizing the 8 week determination).
The omission of RVR may be an oversight, but not likely given VRTX's usual method of pushing anything positive out.
So it appears to me, as to what I understand to be the most numerous group of prior failure patients, SVR numbers in excess of your 85% Prove 3 approval number of 30% I believe, will almost certainly shatter this number. The other 2 arms will be much closer. Either way, the numbers should exceed what anyone was expecting. I was expecting 35-45% SVR.
Tinker
That is the only way I can figure, that the phase 3 for prior failures will start in earnest and that there will not be any 48 week control group, just 12 + 12, but it is hardly a phase 3 without the SoC control group. So that is difficult to believe.
If accelerated approval based upon Prove 3, then we are looking at late 2009, early 2010 at the latest one would think and not late 2010 as stated in the article.
Another possibility is that the FDA will collect on-going data as it comes in and that VRTX will be able to file under its current phase 3 program before the final 48 week control arm and trial are complete because the data will be so robust.
All in all, I think it is a case of an AP reporter without a clue as to what is going on, talking with the analyst, getting his notes spilled on by coffee, and putting down something to get the story out.
The one clear and accurate thing in the story is that 2008/2009 will be about Prove 3. And what makes Prove 3 special is the possibility for a 2009 approval, maybe early 2010.
So you got me on that one. Speculation and guess work is all we can do here. Somebody paid attention however by the looks of the stock price.
Tinker
It also would have made sense not to do their last financing at $17 a share when shortly thereafter the share price moved to $26 a share. The timing was such as it looked like the placement was purposely done at a low stock price as the shares exploded upward not long after the secondary. At least the timing stank there.
But all in all, nearly $1 billion in cash, the most likely new blockbuster in clinical trials today, two follow up HCV drugs, a CF product line that is starting to come into its own, etc. Some real value being built there. That is if they can bring the drug to market without burning through $1 billion before then. But it does give them the resources to bring forward three HCV drugs simultaneously, without a partner if they choose not to partner, also to bring forth their CF program without a partner, and make acquisitions if they want.
Tinker
Dew,
That does beg the question as to whether or not SGP shares your assessment that Respond-2 will probably not be sufficient, and if so, why run a trial that they deem likely to be insufficient?
I suppose they may consider a smaller Phase 3, run more like a Phase 2 to be more economical than running a full fledged Phase 3, as they feel they need more investigation before committing such resources. But I don't buy that one.
Perhaps they feel that the cost of running it, and maintaining the indication will be more than paid off by increased share price.
Who knows what reason they may have. It just does not seem sound practice for Schering to run a Phase 3 that they deem likely insufficient to gain a label expansion or registration on.
So that is where my presumption comes in. There may be legitimate reasons why the presumption that SGP is running a trial they expect to use for registration may not be accurate however. That would derail my comparison with Prove 3, as then the FDA could remain consistent by then requiring SGP to run a second, but larger Phase 3 down the road.
Tinker
28 weeks boceprevir, a long shot, but I am not that concerned, although it is in Schering's interest to maintain 48 week treatment. Could very well be that the FDA required 28 week treatment and it will juxtapose against 48 week treatment given the present data out of boceprevir.
I am more surprised that they are pursuing prior partial responders and relapsers, although I understand they are not pursuing prior non-responders. They are devoting less than 400 patients to this arm of the trial, hardly a strong Phase 3 trial on this second line indication (calculated by the press release indicating 1400 patients, with over 1000 in the treatment naive indication).
Which may be implicitly positive for Prove 3 registration, as Prove 3 had 440 patients enrolled (larger than SGP's Phase 3 trial) and it was at least as comprehensive as I imagine SGP's prior failure Phase 3 will be. Prove 3's 2B trial was every bit and probably more of a Phase 3 than what SGP is running for prior failure patients. It would frankly be disconcerting to see boceprevir get a label extension based upon a less than 400 person clinical trial (after what can only said to be an utter efficacy failure in Phase 2 (albeit they learned things from it) when Prove 3 is at least as and probably more comprehensive and probably greater powered than what SGP is running in Phase 3, and then require VRTX to run a Phase 3, which of course would need to be even more comprehensive than Prove 3, essentially making VRTX run 2 phase 3s, and SGP to run only one phase 3, at a phase 3 that is both smaller and less comprehensive than VRTX's original 2B trial, and this following a very disappointing phase 2 trial for boceprevir in this indication. This would hardly be a level playing field, and clearly SGP would be given superior treatment by the FDA than what VRTX is receiving should that be the case, and should Prove 3 results be consistent with the 107 results. It would be outrageous, and not in any patients best interest, not even arguably so of the Prove 3 results are consistent with 107.
Not like the FDA really cares, but it would be the reality and would further demonstrate a broken regulatory body. But that don't make us money, just griping points.
In regard to the latest presentations, the May 21 presentation is a waste of time, don't bother. Simple talking points and then all questions in the green room.
The May 13 presentation is worthwhile however. The early Prove 3 registration question was indeed asked and answered, and more comprehensively by Michael Partridge than he would the following day at the May 14 presentation. Basically, like Ian Smith, he would not rule out early registration. He beat around the question, and basically said that Phase 3 is the next logical step, to get it going by Q3 and that they had not yet had discussions with the FDA about an early registration strategy, and basically he really could not talk about it or speculate about it. Basically doing so would be "difficult" and he just could not talk or speculate about any other registration strategy other than currently getting the Phase 3 going. So just be quiet about it. Not even a "wink-wink" as they would be too loud. Clearly, it is a very sensitive issue, and VRTX is going to pursue it, but one thing at a time, and they did not want to upset the very sensitive FDA in an shape, manner or form until such time as the tiem was right to discuss it (which I would presume would be sometime in Q3 or Q4 of this year after the final Prove 3 numbers are in).
So we will need to wait but they have clearly not ruled out an early registration based on Prove 3, they are just being very careful and extremely conservative in regard. Look to getting Phase 3 going early and then we will go from there. It seems clear, however, that VRTX's phase 3 will just be a rehash of Prove 3, but perhaps larger (again, implicitly, if SGP's Phase 3 is sufficient for a registration strategy in the second line, then why should VRTX have to run a greater burden since Prove 3 is already larger and more comprehensive, and at least as well controlled as SGP's trial was - and heck, there is more safety data on telaprevir than on boceprevir).
Yes, speaking logic and reason, but those are the plain facts. We will have to examine how the FDA handles this, and it will be very interesting and perhaps very disconcerting. I'll hope that it will prove more interesting than disconcerting.
Michael also commented on boceprevir data, and what he noted as most striking was boceprevir's non-responders (I think referring to prior failures of whatever category) where boceprevir came up very flat even if they did maybe learn something. Also mentioned BID dosing.
But this was the most interesting portions of the presentation and my analysis of it. Michael Partridge did not lay out the disconcerting parts, or the comparison with boceprevir heading to phase 3 on the second line indication or such, but it just seems very self-evident to me and thus my comments above.
Tinker
From MNTA's 10K notes section:
In addition, Sandoz will,
in the event there are no third party competitors marketing a Lovenox-Equivalent
Product (as defined in the agreement) share profits with the Company.
Alternatively, in certain circumstances, if there are third party competitors
marketing a Lovenox-Equivalent Product, Sandoz will pay royalties to the Company
on net sales of injectable M-Enoxaparin. If certain milestones are achieved with
respect to injectable M-Enoxaparin under certain circumstances, Sandoz will make
certain milestone payments to the Company, which would reach $55 million if all
such milestones are achieved. A portion of the development expenses and certain
legal expenses, which in the aggregate have exceeded a specified amount will be
offset against profit-sharing amounts, royalties and milestone payments. Sandoz
also may offset a portion of any product liability costs and certain other
expenses arising from patent litigation against any profit-sharing amounts,
royalties and milestone payments.
Dew, you mentioned that you thought profit share would be around 50% of profits if no third party competition, and a mid teens percentage (if I recall) royalty if there were third party competitors.
Is this accurate? Or is this prognostication?
I figure profits could be calculated at around 20% of gross sales, so give MNTA 10% of gross revenues as their share if they are the only generic Lovenox.
Say the generic product brings in $1.5 billion (no other generic on the market) that would be $150 million per year to MNTA, maybe up to $200 million if the profit margin is higher.
That alone should put the share price at $750 million to $1.5 billion, on this revenue alone at 5-10x revenues).
Is that about what you are calculating?
Clearly MNTA has other generics coming down the line over the next 5 to 6 years, and they have a potential billion dollar blockbuster in phase II, but just trying to get a grasp for this one drug as this is the big point that will move the stock in the next 6-12 months (yes partnership news as well, but probably not until mid 2009 next year, and less important for big price movement).
Tinker
emserm,
Ian Smith made much more sense. He also gave a repeated and not so subtle hint (and this is consistent with what I was stating) is that if the FDA allows the Phase 3 on the second line indication to commence even prior to all the data coming in on Prove 3, that, that would be a very good sign.
Ian Smith, as I would have expected to have been the discussion from Michael Partridge, also stated that Phase 3 is warranted in any event, but the running of a Phase 3 would not prevent Prove 3 from being the basis for earlier registration with the FDA.
VRTX's 10K came out subsequent to his presentation, and the lawyers may have gotten to Mr. Partridge, and therefore the language that he used, which still provides the wiggle room to do exactly as Ian Smith indicated, what ELN is presently planning to to with AAB-001, and what is the only reasonable course of action by the FDA (assuming they are not entirely broken) if the Prove 3 data is consistently robust with the 107 study.
Another way to look at it is Mr. Partridge had the benefit of looking at the data, or the benefit of information regarding discussions with the FDA that Ian Smith did not have, and therefore the change of presentation.
Still, the fact that VRTX provided the extremely robust 107 information, just a few weeks prior to the discussion with the FDA on the Prove 3 study, having to have a good idea of where the data was going, and then not releasing negative data from Prove 3, it would be very stupid on VRTX's part to do so unless the Prove 3 data is consistently robust with the 107 study.
Also, since VRTX is still talking about starting Phase 3 in Q3 of this year if all goes well, which of course means the Prove 3 data was good, well, mostly what one can conclude is that positive events are likely to develop and will be announced in due course and at the proper time.
The first deduction, that Prove 3 data was robust appears to be a safe one, if just by legal necessity and self-interest following the 107 data release, and still talking of starting Phase 3 in Q3.
The second deduction requires the FDA not to be broken and enabling registration on Prove 3 data. This one, at best can be wagered even money despite the fact that any rational person can see that given all the controlled studies, consistency of data, and safety database, and large and critical unmet need, that one is compelled to allow such registration as a regulator.
It is this second deduction which will keep us up at nights (well figuratively anyways).
I'll have to listen to the May 13 or upcoming May 25 (I believe) presentation to see if VRTX sticks with its new more conservative line of thought, if they give some more clues between the lines, or if they really, really mean it and something has changed from May 5 until May 14.
I really am in no panic either way. The data and facts are as they are, and they are compelling for an early registration. But protocol must be followed, and we will learn soon enough for those who are patient. I would say sometime in early 2009 we will have the word on the registration strategy for Prove 3.
Tinker
Dang thing would not let me edit my post.
In any event, we now that the Prove 3 data is robust enough to enable start of Phase 3 even prior to having all the Prove 3 data in hand.
We also know that VRTX is rather confident (if not absolutely certain) that Prove 3 itself will not be sufficient for use for early registration.
And as an aside, that is ridiculous, but it is my opinion that unless the FDA pushes VRTX to make the application, that VRTX is not holding out much hope, nor have much enthusiasm to do so itself.
Disappointing to say the least, as really the only inference that can be made reading between the lines is that the Prove 3 data was decently robust. There was no such ambiguity left regarding the possibility of using it for early filing and registration with the FDA as one might expect in a situation like this.
Tinker
Dew, VRTX conference presentation.
I just listened to the May 14 R.W. Baird presentation. Nothing we did not already know for the most part. Re-hash of what we know, and it just seem silly that they have to do shows like this to enable analysts to get the information that we already know.
This said, the only key new piece of information is Prove 3 and potential for early approval. We discussed the 10K language, and diced it, so that it really does not preclude an expectation of early approval.
However, from the presentation, the presenter made it clear that they expect to have to run a phase III trial to get the broad label. It was not my sense that they thought there was much chance, or they any room was even left open for much chance, to get telaprevir to market earlier without first running the phase III. The language of course is still open to the interpretation to allow for registration while running a concurrent phase III. However, that does not seem to be VRTX's expectation at all.
Could be they are just being very conservative as they are in the process of speaking with the FDA. Plan for the worse, hope for the best, and don't jinx it by articulating possibility for the best. But for those holding options on the basis that Prove 3 may form the basis for registration, not holding one's breath appears to be the apt phrase. Which is disappointing. And leads me to the conclusion that the FDA is broken.
There were only 2 follow up questions to the presentation. One involved Prove 3, but the questioner did not push to get a response to the possibility for early registration. All we learned is that VRTX hopes to start Phase 3 in the second line indication by Q3 of this year.
So there was not even a response such as "we do not preclude use of Prove 3 for for submission to the FDA for an early filing". Nothing of that sort at all. What you leave with is that VRTX is clearly not planning on using Prove 3 that for registration purposes, and they are rather confident that this is the case. So for those of us holding out hope, VRTX is not giving us much in that regard.
Sounds like to me the only way Prove 3 is used for early registration is if the FDA pushes VRTX to file using Prove 3 data for the second line indication. It sure does not sound like VRTX anticipates doing this itself.
So long and short, my take away is that unless the FDA pushes VRTX to file using Prove 3 data, I cannot even describe VRTX being "unenthusiastic" about the possibility of early filing, they seem to have practically eliminated the possibility that early filing will be made based upon Prove 3.
I hope I am wrong and VRTX is just being conservative with the FDA on this side of paranoid, but unlike what you might hear in many corporate presentations where there is always wiggle room that x might happen, but probably not, VRTX is not even talking in the "probably not" veneer. Which is disappointing, and if true, speaks volumes about where the FDA is, and that it is indeed broken (that is assuming that the Prove 3 data is robust as VRTX did not release any hint, nor give any data other then the data must be good enough to run a phase III with).
Tinker
May be a sign a that the share price will start to run again, but with this Prove 3 information, it may be time to start looking elsewhere if one is expecting near to mid-term exceptional news to move the stock.
The other interpretation if you read the language directly is that a Phase 3 trial will be necessary, but that will not preclude the FDA from giving regulatory approval based upon the 2b data, as long as VRTX runs a concurrent Phase 3 trial. Which is exactly what ELN is doing with AAB-001.
Would this not be a Reg-E filing? I am not an FDA legal expert by any means. But at least from a reading of the press release language, it may only be worded that way to indicate that a Phase 3 trial will be run no matter what, but the running of a phase 3 may only be a condition towards receiving marketing approval based upon the Prove 3 study.
So in the end, it may not mean anything, unless of course the FDA is totally broken, which many might just concede it is.
I think the timing of the 107 release as to how close it is until VRTX submitted data to the FDA on Prove 3 is the best evidence that we have that the Prove 3 data was positive and consistent with the 107 data. Not to reveal negative information after releasing preliminary data like 107 would clearly be actionable in a civil case, and I think it would border on criminal not to do so. So one has to feel somewhat confident that the Prove 3 data is at least consistent with the 107 data given the very close timing of the 107 release with VRTX having to know the results of Prove 3.
Tinker
<<<Are the PROVE-3 data that VRTX has seen less than stellar? Or is the above language merely boilerplate conservatism? I’m not sure.>>>
If this is boilerplate conservatism, it is very conservative. The 10Q could have stated that we have submitted the data, we are in discussions with the FDA to obtain regulatory approval based upon this data, there is no guarantee such approval on phase 2 data will or can be obtained from the FDA who wouldn't approve aspirin today with less than 15 years of clinical study. As such we have also submitted a phase 3 trial design to the FDA if the FDA does not enable registration from the phase 2b data, and in such case it will be necessary to conduct a Phase 3 clinical trial in order to obtain regulatory approval.
Language like that, which is still conservative, but which gives more information, would have been perfectly fine and appropriate and unless VRTX understands and has information that there is no way the FDA will even consider regulatory approval based solely upon phase 2b.
If I were VRTX I'd file anyways, and let the FDA come forward with information that (1) there is not enough evidence that the drug works as indicated (despite at least 3 well controlled clinical trials), and (2) there is not enough evidence that the drug is reasonably safe (despite the reasonably large and growing safety database).
If the Prove 3 data is good and the FDA will not even consider approval on this, then the FDA is really broken, and not just broken in the sense that people poke fun at it, but legitimately cracked and broken.
The language in the 10Q would imply that the FDA is broken, unless the Prove 3 data was not so stellar. In which case, VRTX may be in trouble because they released the 107 data on April 24, implyng that the Prove 3 data would be similar. If VRTX was unblinded to the Prove 3 data when they released the 107 data just a month ago, and the Prove 3 data is decidedly not consistent with the 107 data, that would be a big time issue of stock fraud. It is hard to believe VRTX did not have a good idea how Prove 3 was going as late as April 24.
So it would be difficult to think VRTX would do this, as they had to have some idea as to how Prove 3 was gong at the time they released the 107 data if Prove 3 data was not positive. So Prove 3 probably has good to decent data. Which would mean it is at the FDA's feet and they are broken if they have communicated to VRTX that they will not even consider approval based upon Phase 2b, no matter the result.
Wonder how this may impact a stock like say ELN that is running on the hope their Phase 2 study for AAB-001 can be used for registration despite an on-going phase 3.
Tinker
All the briefs were not accessible, but looking through the Aventis brief, they are asking the court to dismiss the trial court's fact findings as clearly erronous. Given what you said about the competence of this judge, and given the fact that usually the standard here is if there is any evidence to support the trial judge's findings that the findings will stand, it seems to me more that this appeal is more in the nature of a delaying tactic than an appeal that they determine has a reasonable chance of succeeding.
The appellate court is not going to sit and review the fact de novo. They are going to look and see if there were any facts supporting the trial judge's decision, and if so, they are going to uphold.
Sounds like you are confident that the trial judge had no issues in misinterpreting the facts, dismissing the facts, ingoring evidence etc, as say, oh Judge Payne in Richmond, Virginia on Rambus's (RMBS) first patent trial. There was a case I witnessed of clear error, and one that could have been overturned, even with the jury finding, given how utterly biased the judge in that case was (didnt' help Rambus that Infineon was building a brand new DRAM manufacturing facility in Richmond at the time).
But if there was nothing like that taking place in this case, that is a very difficult ground to get the case overturned on appeal.
Tinker
http://www.orangebookblog.com/2007/11/index.html
zipjet, I could not find the article in question, but this one will do and I see it has links to the briefs and other information regarding the issues raised on the appeal. I'll have to review it and get to the bottom of it myself.
From this article you can see how one might come away with the impression that the burden of proof is the key issue in the appeal, and since that would be a matter of law, the appellate court would have no problem sending it back down with new instructions on the burden of proof if they felt the trial court got it wrong. If that were the case, then potentially very dangerous.
From reading the article some more it sounds like that is not the case and it is specific factual findings being appealed, which for the loser in a case like this is usually the sign of something desperate to try to get an appellate court to de novo review factual findings.
I'll read the briefs and see what I come up with.
Everyone is assuming that Teva is going to win this appeal. That is a dangerous thing to do. I once had a State Supreme Court rule against me on an issue that was so obvious an blatantly apparent that I am still fuming to this day. It was a simple personal jurisdiction issue, and the State Supreme Court basically threw International Shoe and all its progeny out to reach the result they wanted.
When it comes to patent appeals, the appellate court is known for being conservative, and very stringent on getting their process correct, and if I recall correctly, something like 52% of decisions have been overturned. They have no trouble overturning patents.
I am very interested in regard to personal financial concerns as many on this board are about MNTA as it clearly has tremendous upside iffffff, just a few things go their way. The first thing must be this appellate decision.
I'll get back after reviewing the briefs.
Tinker
Thanks Zipjet for the information.
The journalist sources I reviewed, including one from a patent law journal who wrote a brief summary, described the case as a burden shifting case, such as in an employment discrimination case, where you establish your prima facie case, then burden shifts to show reason why said acts were justified or legitimate.
If Aventis has already had their chance to factually present their reason for these actions, following the remand, then that sounds like a rather desperate appeal on their part. Just concerned because an appellate court could have otherwise easily overturned it if the proper standard was not used. What the patent journal article opinion was, was that the summary judgment standard was not correct and that it was likely to be overturned. But that is obviously not the issue here. If they have had a full trial, with the prima facie case established sufficiently for a summary judgment ruling, and then given a chance to rebut or explain, then that appears more of a factual issue and not one likely to be overturned.
Tinker
That is what I was talking about. Only had a few minutes to get up to speed on it. If the appeal is based upon burden shifting of proof, then there might be a real issue there that is not a certainty. I was just trying to nail down the gist of the issue that Aventis is bringing up on this second appeal.
Tinker
Dew, others,
What is your take on the appeal. I've only been able to go back and get a history of it, but my understanding is the present appeal is based upon the legal standard used in regard to burden of proof. The trial court used a burden shifting mechanism, whereas the defendant is arguing that it should be a totality of circumstances burden with no shifting of burden of proof as to intent.
Anyone looked at this issue in more detail. I'd be happy to look at the original appellate decision if anyone has the cite.
Tinker
Dew,
Looking at the 57% number, and I think this number will fall some more as I believe of the patients who achieved EVR something like 28% relapsed are otherwise left the trial by 12 week SVR. That is a prolific decline. In comparison telaprevir in Prove 1 had something like 12.8% or thereabout relapse and dropouts from EVR to 12 week SVR. Given this prolific fall off, I think the SVR 24 is going to go lower. 55%, 52%, I don't know, but we will see.
But given this, on the 20% increase basis, the control group is going to need to be extremely hard to treat and get a number perhaps as low as 32% SVR, and perhaps as high as 37%. However you cut it, that would be a very tough control group to treat.
Percentage wise boceprevir will need to show a 40-50% increase in SVR24 rate. That is what Prove 2 and Prove 1 respectively saw. From these numbers boceprevir would need a control group SVR percentage of 40 and 38 if SVR24 remains at 57 (which is quite realistic) to a control group of maybe as low as 37 and 34 is SVR24 falls to 52% for boceprevir.
Depending on the final SVR24 numbers boceprevir may be able to make such an argument if the control group is 37 or 38% SVR, but I do not see the number falling any further than this, so it is a bit of a long-shot for Schering. It will be much more difficult to get a control group that comes back low enough to show a straight 20 point advantage.
Further, when you look at it, RVR was very predictive. The pre-dosing group has an RVR of 62% and a SVR12 of 57%. I don't buy Schering's spin that RVR is not proven to be predictive of SVR where protease inhibitors are involved. Perhaps not proven, but in practice reality.
To make matters worse for Schering the previously treated but failed patients (however you want to categorize them), although Schering can clearly re-run these trials and obtain better results than they initially achieved, even those numbers appear to be 10 points or so less than the 35-45% numbers I'm anticipating out of Prove 3 (okay wild ass guess from 107, but I'm trying to extraprolate with greater adverse events due to the 107 exclusions of prior AEs, and the anticipated drop off from RVR to SVR). So across the board you are looking at boceprevir being an effective and competent treatment, but clearly inferior. The final SVR24 vs. control group is by all odds very likely to confirm this unless two things happen: the control groups were on the edge of the bell curve in regard to difficulty to treat and boceprevir, despite an ~ 28% fall off from EVR to SVR 12, that there is no further fall off from SVR 12 to SVR 24.
A long way to say, you have a point Dew, but the odds are not in any way in boceprevir's favor to produce the numbers needed to make the case.
Tinker
Either this is extremely short sighted, DNDN management knows something, or they are fearful of not getting at least a 1 year advantage against the competition, which, if I recall correctly, were due for some phase III results right around 2010. Does management think that Provenge will not be competitive against the more off the shelf medications being tested by the competition if both come to market at about the same time?
Who knows. They probably figure they'll file the drug anyways and argue that the 2% points don't mean a hill of beans given the dearth of alternatives, etc. Same argument as made last year for approval (which I still believe the FDA should have conditionally approved and it made absolutely no regulatory sense not to conditionally approve it given the intangibles here). So perhaps DNDN thinks there is nothing to lose anyways, and we get our day with the FDA a year earlier.
Turned out not to be a good bet last year.
Tinker
This is the sort of case that gives lawyers a bad name and the frictional cost of a stock slide. I doubt very much that this piece of information was very material to anyone's decision to buy or not to buy, and I doubt very much it had much if anything to do with the falling share price. But one can always latch on to something to get a nuisance settlement, particularly after a company has just raised another $400 million + in cash.
Tinker
Now how many people with MS will happen to develop melanoma, raise your hands. Probably a few. How many patients with MS will fall dead from heart failure at any point in time, probably a few. Et al.
There is absolutely no proof that tysabri had anything to do with instantly creating or worsening a case of melanoma. More likely patients taking the new medication that thanks to Teva has been compared to obtaining a case of AIDS (not just being exposed to the HIV virus mind you, but actual full blown case of AIDS) are paranoid and discovered the melanoma due to the paranoia. Taking Tysabri may have saved their lives actually.
It is true that patients on tysabri have reported miracle mole removals anecdotally, and it may be quite possible tysabri has a role (beneficially or not beneficially) in changing the skin, but instant melanoma, don't think so. Tysabri may actually be tested for treating melanoma at some point in the future.
As for the liver issue, that is more credible, but hardly unique to tysabri. It is a potential problem with many drugs and is probably expected to be an issue with at least a small group of patients with any powerful drug of this sort.
Probably like the recent JC virus scare. Funny how the majority of people carry it, yet only when it is found with tysabri patients is it noteworthy despite the fact that there has been no advancement of the JC virus, and no degradation reported of the cells that are thought to keep it in check, at least during the first year of treatment. But still, it must be tysabri's fault.
If I did not know any better I would think tysabri's real name is George Bush! (no politics intended, but right or wrong and you can dicker over it, George Bush is blamed for practically everything, very much like tysabri.
Tinker
A wager? After these VRTX losses?!? Can't get blood from a turnip;)
I'll just practice some patience. Worked great before.
Tinker
Dew,
Thanks for the update. No, I still think your way off on the FT article and its source. Does not matter much however as the share price sold off regardless. But I do appreciate your knowledge and willingness to share.
Tinker
Dew,
Are you stating that VRTX won't be able to have the data in hand by no later than mid-2010, that that is too aggressive, or that VRTX will take a year or more to process the data and submit their NDA?
The latter I doubt, the former may prove true. Although I believe there is 6 month leeway in that schedule which could absorb some delays in enrollment.
Tinker
Dew,
Unless for some reason VRTX has difficulty enrolling the trials, or if the 48 week arm slips back significantly, there is no reason at all that the NDA won't be filed any later than late 2010 to erly 2011. Moving an FDA initial decision out to 2012 really stretches and pads the time line by a very material amount.
2011 is not 2013, and 2011 is not boceprevir getting to market first. It also says nothing about the fact that any HCV drug will need a 48 week arm, or that boceprevir has not even completed their phase II, and is well behind, and that this will not enable boceprevir to catch up at all, much less mention the weakness in the boceprevir data that is apparent on its face by what was reported, what was not reported, and how it was reported and scored. Schering is not even reporting boceprevir numbers with an ITT scoring system.
But back on point, VRTX has so far run its clinical trials on a timely basis. There is no reason to suspect they won't run this clinical trial on a timely basis. The 24 week arm should be done in early 2009 (March start enrollment, finish enrollment, June/July), 24 weeks puts it at January '09, plus 24 weeks for SVR data, and you get final 24 week data in mid '09.
48 Week data will depend on when enrollment begins and ends. Assuming concurrence really means concurrence. You get 48 weeks ending July '09, end of study 24 weeks thereafter Dec '09/ Jan 10. This latter is aggressive however as we don't know the enrollment schedule for this arm, which may be more difficult to enroll given the 48 week requirement. And thus the mid-2010 estimate. It will not take VRTX over a year to compile the data and submit its NDA. We get likely NDA in late 2010, early 2011, which puts FDA decision most likely in mid-2011 give or take.
What this also means for the stock is if the trial stay on schedule, the 24 week interim data will be known well in advance, and even the 48 week data, interim as to SVR during interim periods, will be known well in advance of the 2011 yea or nay date. We will know long before hand if the drug will be approved or not to a great certainty well before the FDA decision date.
And this schedule in no way is 2013 on the market, unless the FDA decides they need additional data after the initial NDA decision.
So I hold to my opinion of the FT article. Give me a source other than an intern at Wake Forest, a confidential corporate executive, and confirmed by another corporate executive. Those are sure tip offs.
There is also no truth to the need to do a new phase II.
Still, the stock price speaks volumes and did not like what was given.
Tinker