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yes, sorry, Amphastar. As a data point, Teva, Amphastar, made no difference. I deal in data points. Amphastar was thought to be an utter non-starter in regard.
My bad, but it makes no difference to the analysis, just evidence of a cluttered and overworked mind that keeps clunking along.
Tinker
How is MAKO’s going from 10 to 40 to 13 (the current price) “better” than MNTA’s going from 5 to 25 to 14? (I think you may need a better calculator.)
I denigrated no forum on TMF or anywhere else; rather, I replied to biotech jim’s accurate statement that “several thought [MAKO] was the next ISRG.”
Fine. On the TMF board in question, you referred to MAKO as “the next ISRG” on various occasions, so you were indeed one of the people biotech jim was talking about.
Mako went from $10 to $40 when I started talking about it on the board you use to follow on TMF. Which is better than MNTA ever did, and better currently as MAKO is still profitable from that point.
Bboth may still follow through to perceived potential, but lets set the record straight on the issue and not implicitly denigrate the forum.
Thanks Dew.
Tinker
EXEL phase II.news unimpressive i assume?
Exel. Yes 2014 is 3 years off, but 2012 pain and survival data, even if for future label purposes and not registration itself is not so far off...there are a lot of potential catalysts and decatalysts from here to 2014. Whether worthwhile holding and buying at these levels for cabo, up to the individual. Presently one could buy cabo for about $200 million net of cash. An utter bargain for a late stage unpartnered cancer molecule of this sort...then again big pharma tends not to be bargain shoppers, but that is what cabo is presently if one's cancer pipeline is sparse of good candidates. For whatever that is worth.
Tinker
Pain is a valid clinical target for an NDA submission. It may be harder to hit, and impossible to get an SPA for, but that does not mean it can not be a basis for an NDA.
The commercial value of this might on it's own be questionable, but as you say they already could be on the market so the broader indication could be of more value than a stand alone pain NDA.
A few days ago EXEL management reduced their estimated year end cash to $300 million from $330 million or something like that. So cash will be ~$300 million at the end of the year. EXEL actually turned a profit this quarter, believe it or not. No, not a sustainable profit by any means.
Tinker
For small biotech companies that are burning cash at a prodigious rate, there is always mileage in impressing the investment community, at least in the short run.
Exel biggest failures, perhaps. A bigger failure was VRTX. Started in the 80s, spent billions and billions over 3+ decades, and now, suddenly, they have telaprevir and a pipeline beyond. Exel is a baby failure in comparison. All in the timing, and I got clunked tonight.
Still, Cabo is a very promising drug starting phase III. Not done yet. Hurt, yes, done, not even close. But there will be a wait without question,
Stinging Tinker
Here is my back of the envelope difference in earnings with AG and non-Ag but no other generic on the market.
Aggressively assuming $800 million to NVS in sales with $80 million annual expenses to MNTA = $115 million profit before tax to MNTA under the AG economic model.
Vs., at $1 billion a year NVS sales, 65% gross margin, 45% profit share of what was $292 million per year minus $80 million in expenses = $212 million per year.
Difference of approximately $100 million per year after taxes.
Difference being, with IP protection, the market may give MNTA a larger multiple. Say 5-10x vs. 2x that we currently enjoy.
Which either way you look at it, pretty much, you get copaxone and FoB for free. But we already knew that.
Tinker
Look at PDLI for a company with an overarching patent on biological drugs...has not done much for the company per se...worth something yes, but it was their drug development program that was the big value driver, not the royalties.
In drugs, bring to market drugs. Far more profitable the protected drug market vs. a royalty or licensing fee.
Tinker
Reasonable to make inferences: "On the other hand if you "choose" cell host line based on certain parameters(to prove sameness) you will likely infringe on MNTA's patent at least for NEXT 20 years-2031(This patent is fresh out of the oven.filed in October 2011) "
Strongly suggest that this is very much missing the point of the enox demonstrated Momenta patent strategy
Will MNTA be approved before MYL (?), and if they are, will their patents be adequate to block others from entering the market? Based on what happened today, I would say 'yes'!
Question for the lawyers - are their questions that judges ask of lawyers that are intentionally set such as to elicit truthful answers about the lawyers own opinion about their own case - because to answer untruthfully just penalizes you in a different way?
I wouldn't even be surprised if this category of dilemma-esque questions has a name.
All it takes is one argument to stick. I've been there, throwing stuff up there, all crap, but suddenly, out of nowhere, something catches the judge's eye, and an articulatable theory is presented that becomes a dispositive element, from out of nowhere. So yes, it is a well used tactic.
This said, MNTA has to show likely to prevail. Throwing stuff on the wall, unless one piece really sticks, is not a great strategy for the other side to show that MNTA is not likely to prevail, but rather seems to demonstrate that MNTA "may" fail, but that is known already.
So this sort of behavior is out of weakness...doesn't mean something effective might not flow from it, as it sometimes does.
Tinker
I was surprised, too, that it was not the '466 patent, which does mention the 1,6 anhydro ring. Here's a quote from the transcript, from the beginning of the hearing:
I would argue that the launch of the AG is a direct result of and the damages proximately caused by the Amphistar intent to launch (possible actual launch).
Yes, it looks like to me this puts a big dent in the PI argument. It also dramatically reduces the damages that MNTA could have potentially have claimed. And by doing so it also dramatically reduces Amphastar/Watson's risk if they decide to launch at risk, which at this point in time I believe they will given the reduced risk if the PI is not granted.
It also dramatically reduces the value of MNTA's enoxaparin IP, as keeping out a competitor now is worth in the $10s of millions per year and not hundreds of millions anymore with an AG.
All in all, a broadside hit, making this litigation less imperative, less valuable, less defining for MNTA. MNTA now has copaxone as its next big thing and enoxaparin should become baked in as a given at this point in time in regard to dramatically reduced revenues.
Talk about taking air out of the balloon. But there is no PI vs. an AG.
Tinker
The waterfall plots of lesion responses in prostate for example looked pretty good to me, particularly with some responses in patients that had already failed platinum drugs or had failed abiraterone.
I respectfully disagree. I don't think one should extrapolate the results from the MTC trial to an effect on bone metastases, and it certainly doesn't clarify whether cabozantinib would have any competitive advantages over currently available drugs for prostate cancer.
That is an outstanding result for EXEL and although clearly not dispositive yet, seems far fetched now that those bone scans are not some real medical advance. True MTC is not the ideal test for it, but the results and the known effect of the drug have to give one some solid confidence that this drug works, it works well, and it works well compared in the context of the competitive environment.
Tinker
what worries me about this Amphastar argument that ANDA approval batches can be sold is that it could constitute a launch without being patent infringement, thereby decreasing the liability towards Mnta since it was not the infringing activity that caused Mnta to sustain a big loss
Iwfal, thanks for the analysis. Very well done. You have hit the matters on the head. I cannot comment on obviousness, but what I can comment on quickly is the behavior of litigants. Attempts to justify behavior by extreme interpretations of the law is not uncommon, and usually go down in flames after a lot of frustrating yelling and pontificating by the wrong doing party. I agree here that the Safe Harbour will not be made that large unless courts desire to simply destroy patents.
I argued this sometime last year on this board and reached the same conclusion based upon a potential Teva claim in regard.
I have also found that if a litigant will make such a desperate argument in one place, and stretching safe harbour is desperate, that they will do so elsewhere as well, and it is very telling to me that they could only come up with one other defense. Characteristically this defense is probably also quite the stretch or they would be leading with it and breathing fire as well by it. So the obviousness argument is probably a stretch as well.
Your post very much clarifies the issues. If mnta gets the pi it will be an extraordinary situation, and from your clarification you can see why mnta just might get it.
Tinker
if Amphastar used a Momenta-patented process to successfully produce generic Lovenox in the lab, they could not use this same process to subsequently mass-manufacture generic Lovenox for sale?
http://en.wikipedia.org/wiki/Research_exemption
is the general outline of the Bolar exemption.
Tinker
my understanding from one of the motions filed on 10/19 is they are using obviousness to 1985 patent. They have also quoted patent prosecution where rejection was sent based on obviousness before final allowance. This in addition to their other defenses which you mention.
Thus, when analyzing the likelihood of success factor, the trial court,
after considering all the evidence available at this early stage of the litigation,
must determine whether it is more likely than not that the challenger will be
able to prove at trial, by clear and convincing evidence, that the patent is
invalid
Take it for what it is worth (as it is free), but Amph has as good as admitted to using MNTA's IP on at least one patent. They are claiming safe harbor and legal technicalities to get around this use, and if I read correctly (admittedly I sped through it) they are claiming that each of their production batches using MNTA IP are utilizing this IP, but only for FDA approval, even if the batches are then subsequently utilized for production and distribution.
Is that what others are interpreting?
If so, MNTA has an excellent change of getting the PI as Ampha's justifications and defenses are legal niceties that will require a full trial, and the trial could go either way, and it is speculative, at best, with both sides having their own good faith arguments as to how it will come out. But there is one undisputed thing: MNTA's IP is being utilized by Amphastar, and utilized in a manner that is bringing product to market in the U.S.
I argued something very similar yesterday (on a different topic of law, but with a similar one undisputed thing, and parties can disagree on the merits around the definition, but that one undisputed thing existed, and it proved my case) and in my mind, since Ampha admits using the IP, MNTA has demonstrated they are "likely" to prevail unless Ampha's use of this IP is transparently within a safe harbor or other technicality, and there is no reasonable dispute on this.
The only reason I am even holding through this period is because of copaxone, always there to prop us back up, but reasoning through this, that seems the most likely outcome to me on the issue of likely to prevail. IP being utilized, good faith argument on both sides as to technicalities or no technicalities, MNTA is likely to prevail.
Tinker
Read the reports again, it is patently obvious the bias. It is analyst speak, where they speak in a manner attempting to sound objective but conclude, on the basis of nothing but conclusions and self-serving speculation, the positive for the shares they are promoting.
These analysts are often recently minted MBAs, or even just out of college folks on their first real big jobs and they are not often very good at it. They keep it simple.
It got so bad in the Internet bubble that a firm would send out a 25 year old ( + or -) recent grad (preferrably hot blond, and they would often comply), and they would give a teleprompter like presentation, and then questions would come in, and the "analyst" would ignore the question, and pull out a note card and read verbatim the pitch on the stock - AGAIN! People would take this seriously and buy the stock.
Look at the analyst report Dew referenced earlier today where they actually gave NEGATIVE value to enoxaparin becuase it was the only way to derive the predetermined price target. At its worse case there is positive value for enoxaparin.
Analyst reports, for "free" are given out for a reason, usually to please their underlying client, and it is easy to spot the bias, as well as to take out the valuable stuff, just takes some practice.
There is value in these reports, but it is not from the price targets or conclusions, but rather looking at the underlying data, and other market and competitive factors. They almost always outline it well, include many factors such as potential market size that can be deciphered for valuable information (even if the underlying conclusions need to be ignored) and you can get some good stuff out of these.
But the litigation report is like the play by play by the home teams announcer for local TV - without the cynicism.
Tinker
The notes given have been clearly written with a Teva bias, which is all one can expect for "free" from an analyst. I've read them before in multiple cases. So one cannot make heads or tails out of them in regard to actual substance.
This said, no, we have no idea which way the verdict will go. 50/50, 30/70, 70/30, who knows, but pretty much we know the odds are somewhere in that range, one way or another.
Tinker
To what extent could Watson be on the hook as well?
Fully indemnified by Amphastar? Comforting? No.
Amphastar is a private company that needs a big pharma to manufacture and distribute. A catastrophic loss in court and Ampha is unlikely to have the financial resources to indemnify anyone.
Legal fees, Ampha probably has enough to reimburse for legal fees, but maybe not if they are hit with a big judgment.
Long and short, it is a comforting press release for shareholders, but reality of indemnification is that you are only as secure as how deep the pockets run by the indemnitor. I don't think this materially changes anything.
I do not know what else Amphastar has going for it product and business wise, but if generic enoxaparin is it, look for Amphastar to be reckless and Watson to be not so reckless, and it will depend on how much control Watson wants to attempt to assert in the process. If this is Amphastar's company, and the company is based almost solely on this product, then they are going to launch unless they are somehow restrained, as what other choice do they then have but to die a slow and whithering running out of cash death as litigation proceeds.
Watson, on the other hand, just another drug, nice cash stream, but they can live with or without it, so they should be much more risk adverse.
Tinker
A 4th Q launch leaves ample time for the filing of the lawsuit. At this point, MNTA has to file if they have anything. And given the history of such suits in pharma, as evidenced by Teva, such suits don't usually need a lot to go on to gain some traction and reality, if for nothing else to buy traction at the rate of over $50 million per quarter for MNTA alone.
Such suit will be filed as I believe the most likely explanation for Ampha's approval is use of MNTA IP.
No, investing in IP is not a fun thing to do however. Neither is investing in lawsuits. Now a copaxone approval....yes, well, life is not always so kind.
Tinker
Royalty Rev $9M/q
Down from $13.5M/q with the 4-way.
the overall effect is to reduce MNTA’s Lovenox take to 25% of its prior level.
http://boards.fool.com/29550708.aspx
My response that I did on the Motley Fool. Gist, this probably bodes well for generic copaxone, but is very probably catastrophic for enoxaparin absent an successful patent suit. So really, the stock is a tremendous buy on generic copaxone, and right where it probably should be for another generic enoxaparin. Since we can only invest going forward and not would be, could bes, should bes, what is the best course of investment action from this point in time is the question.
I linked to the below site that explains the Orange Book categorization and the use of the term "Thereapeutic Equivalence". From the reading of this, there does not appear to be a large gray area of what the term means, if the term is being used correctly.
http://www.uspharmacist.com/content/s/167/c/28604/
Yes, labeling discussions is ambiguous one would think, but it could refer to something more innocuous. This remains ambiguous, but I am not hanging my hat on it (although, you know, keep hope alive and all).
The good news is, I expected about a 33% hit on a generic enoxaparin approval, and so it has hit. It does nothing to the value of copaxone and the much more favorable economics therein. If just the litigation overhang would part. FDA may be starting to get in a groove on more complex generic approvals as they have now had substantial experience in this category of generic with success.
Tinker
There is certainly a sell on the news aspect here, but there is also the "deaths" as the headline, the Bayer drug as a headline, and this overwhelms what was already known and that is the bone scans, for which I was hoping to receive definitive information that they were everything we might hope. Instead, there is still some ambiguity there. This said, the drug is still looking "unprecedented" in its effect on the bone. What is less is clear is exactly what this means regulatory and market size wise.
I am surprised the share price did not rise more upon the prostate data release, but maybe that was already known and it was the other complicating factors that were not known.
All in all, 15-20% is just a day in the market for a biotech like this. What will be important is to see if the share price holds here or starts the day by day decline.
One thing I would like better input on is the definition of "pain reduction" and less use of narcotic pain drugs. These are proxies for the drug really working, and working well, but there is nothing but adjectives provided in the press release to put a magnitude on these figures. These end points are difficult to assess in and of themselves, but I would like to have some way to guage the magnitude of the effect that is being seen.
Phase III will be somewhat risky as EXEL really would not appear to have the dosage issue resolved, and that seems to be a clear issue to be worked out. However, even in a small cohort we are seeing some very statisfically significant disease progression numbers. There is a lot of positive here in the bone data, which surprises me that the rest of the data on soft tissues is otherwise underwhelming. But the bone issue is a clear unmet need, and this will be a significant medical advance in that indication if the data holds up clinically in phase III. There is clearly something unprecedented going on here.
Anyone disagree with this?
Tinker
I spoke with an MS patient on copaxone and she is not going to be easy to persuade to try any other Med for the condition. I think there will be a strong entrenchment and not wholesale switching, at least not until more years of experience on the orals.
Tinker
You guys are over emphasizing PR for business savvy. Tea is very business savvy but in the context of mnta all that matters is what the FDA decides with copaxone and with enoxaparin. The rest is just pillow talk. Nothing te a can do about it no matter how much they spin.
Tinker