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4.6 million share options outstanding finally acknowledged = 6.45 millon shares in reality
Today's Accesswire article finally openly acknowledges the 4.6 million share options outstanding, that mean there could be up to 6.45 million shares in reality, depending on strike price. This acknowledgement is buried in footnote 2:
[2] Computation does not include Lightlake's ~4.6 million cashless options. Using a net share settlement feature would allow the company to only deliver the difference between the market price and strike price in issued shares when the options are exercised. At $10, for example, a total of ~580,000 shares would be issued from exercised options, bringing the diluted shares outstanding figure to approximately 2.38 million. The dilutive effect will vary depending on market price at time of exercise.
4.6 million share options outstanding = 6.45 million shares in reality
If you read the most recent 10-Q filed on 12/14/2015, you will see that there are 4.6 million share options (with an overall average strike price of $8.74) outstanding and for the most part given to the directors, so once those are exercised, the share count will probably be over 6.4 million. The option strike prices vary, with a base of $7.25/share for the most recent grant on 10/27/2015. The most recent funding on 12/8/2015 of $500,000 for .75% of profits implies a market value of about $66 million USD. Divided by the more realistic figure of 6.4 million shares - once the options are exercised - yields a stock price of about $10/share - where we are at. So it appears the market is in fact fairly valuing the company by taking into account the 4.6 million options outstanding but simply not yet exercised. So don't count on that 1.8 million share count holding for long. Otherwise, we should be over $30/share, and we are not.
Scripts - anybody have the OTREXUP scripts for the last three weeks?
Scripts - 21 Nov. 2014 from the YMB
drroid78 • 9 hours ago
Scripts
11/21 Total 559 New 306
11/14 Total 524 New 255
411 K USD
Rasuvo 59 vs 43
Scripts - 17 Oct 2014 - from YMB
Here are the new figures
drroid78 • 8 hours ago
Scripts
10/17 total 475 new 279
10/10 total 411 new 220
retail sales 356K USD
Rasuvo 3rd week - 10 scripts vs. Otrexup 3rd week 22 scripts - just for comparison
• ag47xray • 3 hours ago Flag
Comment on script # fluctuations. Thanks droid for the numbers each week. Just a prospective….. I am a manager in an imaging department in a large academic medical center and 20 years of experience has taught me that... Patient Volumes Fluctuate! Sometimes predictable and sometimes not. It's just the nature of the business. I expect the same to occur in the script numbers....which has happened. You have to look at the overall trend which appears to be steadily improving. On a predictable note……expect script numbers to be down the weeks including the dates of November 14-19 as the American College of Rheumatology will be holding its annual conference in Boston. Fewer R.A. docs will schedule clinic appointments on these dates which means less Rx’s
Scripts for 10 Oct - from YMB
drroid78 • 17 Oct 2014
Scripts
10/10 Total 411 New 220
10/03 Total 548 New 325
Retail Sales 324K vs 399K
Rasuvo 3
Scripts number for 03 October - from YMB
Here are the new figures
drroid78 • Oct 10, 2014 5:06 AM Flag
10/03 total 548 new 325
09/26 total 523 new 319
Retail Total Rx USD 399K
Rasuvo 5 units, sales 2 114 USD
Scripts
10/03 total 548 new 325
09/26 total 523 new 319
19/9 total 464 new 259
12/9 total 435 new 233
5/9 total 430 new 241
29/8 total 472 new 298
22/8 total 464 new 275
15/8 total 416, new 272
8-Aug 369
1-Aug 381
25-Jul 390
18-Jul 322
11-Jul 358
4-Jul 303
27-Jun 339
20-Jun 321
Scripts for this week - from YMB - a nice bump!
Posted by drroid78 • 8 hours ago
Scripts
09/26 total 523 new 319
09/16 total 464 new 259
Total retail sales 407K USD, avg 778USD
3Q total sales 4.029 M USD
Rasuvo 0 Less
Scripts from YMB - posted by drroid78
Scripts
09/19 total 464 new 259
09/12 total 435 new 233
Rasuvo is out with 2 scripts, so let´s come play, next weeks and months will show who is the winner, or may be it is a win win game. we will see
Scripts for this week
From the YMB:
drroid78 • 8 hours ago Flag
23 users liked this posts users disliked this posts 0
Reply
Scripts
29/8 total 472 new 298
22/8 total 464 new 275
Total scripts in 2Q 2937 generated 1,7M USD net sales
Scripts in July + August 3473, we will see September numbers (last 4 weeks in August was 1721 scripts) so we can expect some growth (cca 25% growth 4 last weeks of August vs 4 weeks of July) so cca 2150 scripts in September would be real. Possible 3Q is around 5 600 scripts (without any acceleration which is very possible), so we can be somewhere in 3-3,3 M USD range in net sales for full 3Q and may be higher in case of any acceleration. We are on the way.
There is already Rasuvo set up (with no data) so it will be interesting to see its trajectory in comparison to Otrexup
rph_investor - thanks for posting the script numbers!
Will you be able to do so week by week?
Thanks again. The numbers are encouraging.
Note: ATRS has expected Rasuvo's launch in October to allow Medac to market it at the American College of RA meetings in Boston in November:
http://www.acrannualmeeting.org/
A couple more notes from the company: ATRS does not yet have Medicare part D coverage as they missed the September-October window last year when Medicare makes their decisions on their formulary for the next year. So they will presumably get coverage with Medicare part D later this year. However, ATRS said that their main target population is females from 35 – 50 years old, and they now have 90% of the 250 million commercial lives in the U.S. covered with some form of payment. Also, they said a good number of copay cards have been activated the last two to three weeks, so hopefully we will start seeing more patients trying Otrexup now that their cost is $0 out of pocket.
I would add that while ATRS is keeping the exact cost of the litigation un-broken out in their G&A expenses, they have spent a couple of million so far on litigation and feel they need to continue to keep pressure on so that other competitors – especially in the testosterone market – don’t just walk all over them. There are also potentially other ATRS patents involved that have not yet been publicly disclosed, so maybe their case has more meat to it than would be suggested by the judge's initial reasoning in the 10 July 2014 denial of the preliminary injunction.
Finally – related to the ATRS agreement with Uman in Canada – there is an agreement, and if Otrexup (or whatever they will call it) gets approved in Canada and marketed, ATRS will get some money. How much - no idea. As to marketing in the rest of the world, the company said the pricing and profit margins in Europe and elsewhere are quite low, so while they may consider marketing outside of N. America in the future, right now the U.S. market is the place where they can realistically expect to make money. Indeed, the reason Medac GmbH formed Medac Pharma is because they aren’t making money on their SC-MTX product in Europe and see the U.S. as the place to try to make some money due to higher pricing here.
Rasuvo launch the first week of October
http://www.arthritistoday.org/news/new-methotrexate-autoinjector-349.php
FDA OKs a New Methotrexate Injection Device
Rasuvo, a prefilled syringe, may make injection easier.
08/15/2014 | By Linda Rath
The Food and Drug Administration (FDA) has approved an injectable form of methotrexate that is administered in a prefilled auto-injector; it’s the second such product approved in less than a year. The new product, called Rasuvo, is indicated for adults with severe rheumatoid arthritis (RA) or psoriasis, and for children with polyarticular juvenile idiopathic arthritis (pJIA).
Methotrexate is one of the most commonly used treatments for inflammatory types of arthritis. A disease-modifying antirheumatic drug (DMARD), it can help slow joint destruction over time in addition to relieving pain. Methotrexate is commonly available as a pill or injection.
Until recently, the injectable form had to be measured and drawn into a syringe from a multidose vial. But in October 2013, the FDA approved Otrexup, a prefilled, disposable auto-injector that delivers a single dose of methotrexate without the need for vials or measuring.
Rasuvo also delivers methotrexate in a prefilled auto-injector. It differs from Otrexup by offering more dosing options. Otrexup comes in four strengths: 10 milligrams (mg), 15 mg, 20 mg and 25 mg; Rasuvo is available in 10 strengths, ranging from 7.5 to 30 mg in 2.5 mg increments. (The starting dose for most adults is 7.5 to 10 mg; for children, the dose depends on weight).
“For both Otrexup and Rasuvo, the clear benefit is that patients do not have to pull up the dose themselves and [the shot] is not painful,” says Natalie Azar, MD, a clinical assistant professor in the division of rheumatology at NYU Langone Medical Center in New York City.
But Dr. Azar doesn’t see the extra dosing options as a big advantage. “Most patients will respond equally well to 15 mg and 17.5 mg, and the 5 mg dosing increments of Otrexup have been sufficient in my opinion,” she says.
Mara Becker, MD, director of the division of rheumatology at Children’s Mercy Hospital in Kansas City, Mo., says the approval of Rasuvo is “great news” for kids with arthritis.
“Subcutaneous [beneath the skin] administration of methotrexate is the preferred route in the 2011 American College of Rheumatology recommendations for the treatment of JIA. A [device] that can ease the administration of methotrexate is a great step forward for our patients and could minimize potential errors by having the appropriate dose prefilled in the syringe,” says Dr. Becker.
Whether injections are better than pills for all patients is an ongoing debate. Some studies show injected methotrexate is better absorbed than the oral version, especially at doses greater than 15 mg, while other studies have found no significant difference between the two. There are also questions about whether the injected form reduces common side effects of oral methotrexate, such as nausea and vomiting. But self-injection can be difficult – especially for kids and for adults with arthritic hands – and for many it is less appealing than swallowing a pill.
Medac Pharma, which manufactures Rasuvo, says it has not yet set a price. Its competitor, Otrexup, costs $500 to $600 a month for a 25 mg dose – more than a vial of methotrexate and far more than pills, which cost $20 to $30 for a dozen 2.5 mg tablets.
Dr. Azar says she hasn’t had trouble with insurance companies covering injectable methotrexate, but adds, “This will vary on a case-by-case basis given the patient’s insurance and prescription drug coverage.”
According to a company representative, Rasuvo will be available the first week of October.
Scripts for 8 Aug - from the YMB
Here are the figures - you can read the post on YMB for more details and discussion about the numbers:
bindroy • 3 hours ago
scripts
369 and 225
• paras_hemrajani • 2 hours 44 minutes ago
Stuck for 8 weeks in the 300s, thought for sure we would have hit 400 today. Last 8 week script counts makes we wonder if Otrexup growth has plateaued and this is without competition. Looks like they are adding only 100-200 patients a month. Really frustrated with this management.
20-Jun 321
27-Jun 339
4-Jul 303
11-Jul 358
18-Jul 322
25-Jul 390
1-Aug 381
8-Aug 369
A good Q2 2014 and a very bullish conference call:
http://seekingalpha.com/article/2406285-global-telecom-and-technologys-gtt-ceo-rick-calder-on-q2-2014-results-earnings-call-transcript?part=single
Their financing is stronger and cleaner now, and they are well poised for some more acquisitions – I believe they have successfully done something like 15 in the last 5 years or so – Tinet last year almost doubled them - and the acquisitions are usually accretive to the bottom line within 2 quarters.
My guess is the stock will stay in the $10-$12 range until the next major acquisition - and perhaps until the next major acquisition starts generating clear results. Organic growth alone will be somewhat slow to impact share price - they really need M&A to get to their goal of $400 million revenue / $100 million EBITDA in the next 2 to 3 years. $11/share is probably a pretty fair price for where they are now. I have no reason to be believe they won't do it [sorry for the double negative]
Been following GTT closely for 5 years when I first bought under $0.80, and they have hit every target they have publicly set. But I doubt we will see it in a year - may be more like 2 to 3 years. But at $100 million EBITDA, no reason this is not a $20 stock. And at that level, they probably start to get noticed and could see a buyout offer at $30/share. And still - it seems that NO ONE KNOWS THIS STOCK EXISTS! Obviously some do - hence the price rise from $1 to $11 in the last two years. But no press coverage by outsiders to speak of - which is great for those hoping to still buy more, as I do once another stock of mine hits some targets and I can sell it and plow the money into GTT.
GLTA.
To what does “90%” coverage refer?
Anybody on the board have expertise in third payor coverage and Rx formularies?
In the Q&A time, Hobbs made the statement that “With regard to payer coverage, currently we have secured 90% coverage and are continuing to work to expand that.”
Does anybody have a clear idea what he means by “90% coverage” ? Does he mean 90% of potential patients are covered by insurers who have approved Otrexup? Or that 90% of major insurers cover Otrexup? I’m not clear to what “90%” refers.
There was a post yesterday on the Yahoo MB by pharma_ad_guy that he has not seen Otrexup included on any Medicare formularies – you can find it on the YMB under: “Tired of this lame rhetoric about how good it is to have Medac enter the market” by rearviewforecaster •Aug 8, 2014 10:00 AM Here is the post:
• “pharma_ad_guy • Aug 8, 2014 10:56 AM
• They [Medac] may believe that they can do it [contracting with insurers] more effectively than Antares has done so far.
• The key to this product has always been contracting. Its entire value prop is that it's an effective way to treat RA for patients who aren't getting enough relief from oral methotrexate but don't want to move on to pricey biologics yet. So it does fit into a nice niche - the way to exploit that is to get payers to include Otrexup trial as a necessary step therapy before moving on to a TNF-alpha inhibitor.
• A quick survey of insurance plans suggests that hasn't happened yet. As far as I can tell it isn't included on any Medicare formularies yet (where most patients with advanced/advancing RA are going to be covered), and on private insurance it's a mix of requiring prior authorizations on specialty tier, tier 3 unrestricted coverage, and not being on formulary. So it's getting there, but it's still a long way to go.
• Maybe Medac thinks they can do a better job with contracting than Antares has so far. That's the only logic I can see.”
If he is right, and if Medicare has not yet approved payment for Otrexup, I think that would clearly mean that no where near 90% of potential patients are covered.
Anyone have insights as to the actual percentage of the potential patient base are covered by plans that have agreed to pay for Otrexup? Thanks!
Question how Rx formularies are decided.
This is for anyone with experience in how Rx formularies are determined. How hard will it be for Medac to convince HMOs and other PPOs to add Rasuvo to their Rx formularies if ATRS has already gotten them to add Otrexup? With my own HMO, it is rare for the pharmacy to carry more than one branded product for a given condition, as well as one generic if a generic exists (which it does not yet in this case). So if Otrexup is already on the formulary, how hard would it be for Medac to get them to add an equivalent branded product – Rasuvo? That would presumably double their effort to order, monitor and maintain appropriate stock for an SQ AI MTX product.
Of course, if Medac offered a deep discount to Otrexup, that could provide a financial incentive to do so. But my guess is the Medac wants to make money in MTX – it is not making much money in Europe due to low margins, and so wanted to enter the U.S. market with its higher margins – and so is unlikely to engage in a significant price war with ATRS.
Likewise related to third party insurance coverage – is there much of a barrier for Medac to get Rasuvo covered if a given insurer has already agreed to cover Otrexup? In this case, I suspect there is less of a barrier since the insurer doesn’t have the hassle of trying to maintain appropriate stock of two instead of one drug – they simply pay whatever they pay when the claim comes in.
And does anyone know if Medicare has agreed to cover Otrexup? Thanks!
Question vis requirements to prescribe Otrexup (and Medac) by an MD
I have a question for any with experience with RA medical practice.
Besides the sales staff efforts to convince an MD that he should use Otrexup, what is involved operationally in getting an RA specialist to prescribe an SQ AI MTX product? Specifically, what kind of training and effort is required by the MD and the staff for this? For example:
• Does at least one staff member have to be trained by ATRS personnel how to administer Oxtrexup, so they can in turn train the patients?
• If so, then would at least one staff member also have to be trained by Medac personnel how to administer Rasuvo, since its delivery process is somewhat different than Otrexup’s?
Main reason for asking: in addition to the efforts of the sales staff to convince a physician to prescribe an SQ AI MTX product, if there is some significant degree of effort required to actually prescribe and train staff to train patients how to administer an SQ AI MTX, that would suggest that if ATRS can convince a significant percentage of the 3,000 RA specialists who write 80% of the MTX prescriptions to prescribe Otrexup before Medac starts its sales efforts full-steam, that should make it harder for Medac to get market share.
My guess is these RA specialists and their staffs are very busy, so if they already have committed to prescribing Otrexup and are trained to do so, they may be unwilling to spend the additional time and effort to prescribe a second product (Rasuvo) that is therapeutically identical. I.e. “I’m already prescribing an SQ AI MTX (Otrexup) – why would I take the time to offer a different one? (Rasuvo)” – especially since ATRS has made it zero cost for covered patients.
Comments?
Td - few of the Q's were answered that you hoped in post 3543 would be answered in this cc.
No guidance about sales, almost nothing about any programs other than QST. Also - most of the presentation was simply reading the press release - rather ho-hum.
That being said, it seems the ship is heading in the right direction. It would be nice, however, if management was more forthcoming about the progress in their programs.
Let's hope there are some announcements in the second half related to the Epipen in particular, and maybe even some light about a partnership on QST.
Casualtrader - do you think ATRS should pursue this course?
I am aware of the high costs of IP litigation as my brother is an IP attorney/litigator, and I know what he charges.
Hence my question - given the high costs, and what I suspect is the likelihood ATRS will not prevail given the differences between the two injectors - is this a reasonable strategy to pursue? What is ATRS really gaining? Will it appreciably slow Medac down to let ATRS get more foothold? Will it likely cause Medac to agree to a settlement more favorable to ATRS than otherwise? Will the litigation produce a reasonable ROI, so to speak?
I realize these are probably hard questions to answer from the outside, but curious if any of our attorney posters have any insights. Thanks!
Another question about legal costs from the 10-Q:
From p. 20 of the 10-Q, it says:
General and Administrative
General and administrative expenses totaled $4,330,981 and $7,120,947 in the three and six-month periods ended June 30, 2014, respectively, compared to $1,933,768 and $3,884,198 in the same periods of the prior year. Our general and administrative expenses consist primarily of salaries and related costs for personnel in executive, finance, accounting, business development and internal support functions. In addition, general and administrative expenses include directors’ compensation, facility costs and professional fees for legal, consulting and accounting services. The increase in the second quarter and first half of 2014 compared to 2013 was due primarily to an increase in legal fees associated with the Medac litigation discussed in Note 8 to the consolidated financial statements, professional fees and personnel costs.
The G&A expenses of $7,120,947 for the first six months of 2014 are $3.2 million more than the $3,884,198 reported for the first six months of 2013. The note above says the primary reason for the increase is legal fees, which would imply the total legal fees are in the neighborhood of $3 million for 2014, which is substantially more than the $1.3 million in legal fees they are capitalizing as noted in their point 8 of the 10-Q. Am I missing something here, or are there potentially an additional $1.7 million in legal fees that are being expensed but not broken out in the G & A expenses? That is, how much are they spending in total on legal fees?
Legal costs from the 10-Q today - p. 8:
Capitalized Patent Costs
The Company capitalizes external legal patent defense costs and costs for pursuing patent infringements when it determines that a successful outcome is probable and will lead to an increase in the value of the patent. The capitalized costs will be amortized over the remaining life of the related patent. If changes in the anticipated outcome were to occur that reduce the likelihood of a successful outcome of the entire action to less than probable, the capitalized costs would be charged to expense in the period in which the change is determined. As of June 30, 2014 and December 31, 2013, $1.3 million and $0.1 million of external legal patent costs were capitalized, respectively.
That seems like a lot of money being spent on a suit that it appears ATRS is unlikely to ultimately win, since the BD injector is manual and delivers a bolus, while the ATRS injector is a jet injector - probably enough of a difference to fend off the claim of infringement. Also - how expensive are the next steps going to be? Do any of our lawyer posters have an opinion on whether or not it is truly worth the money for ATRS to continue pursuing litigation instead of more aggressively seeking a settlement so everybody can get on with it? For example, is it relatively inexpensive until trial actually starts next year, so that it is a reasonable tactic to spend some on legal expenses for the next few months to keep pressure on Medac to try to get a better settlement?
Fortunately, it appears that Medac's countersuit is also highly unlikely to succeed, given copious prior art and obviousness. Hope they settle soon and remove this factor of uncertainty.
Impressions of the conference call?
Seems results are more or less as expected - not great, not horrid, but more or less in line. Seems cash burn was a little over $7 million - again, probably in line with expectations, or maybe even a bit better than expected. No sales guidance, no significant comments on products other than QST. Seemed rather lackluster - definitely did not seem to me a "hit it out of the park" kind of call.
Price has already dropped below $2 - be interesting to see if we break the 52 week low today and in the coming days.
Thoughts from those who have been following this company closely?
Anyone have access to the new script numbers?
New script numbers - anybody have access to the new script numbers this week?
How a buyout offer would likely play out:
Since there has been a lot of speculation in the press and on message boards over the past year about the possibility of a buyout of ATRS, and since such a low share price might be an inducement to someone like Teva or Pfizer to consider trying to acquire ATRS as a low price, I’ve done a bit of research and believe it would likely go as follows:
• First – I checked with the company, and there is apparently no “poison pill” or anti-takeover provision with ATRS
• An offer is typically made secretly just to the board.
• The board considers and also gets a fair value estimate made by a third party
• There can be extensive back and forth privately about the offer between the board and the buyer as to price
• If the board eventually agrees the buyout is in the interests of the shareholders, they will make it public and recommend it be approved – then the shareholders can vote. In this case, the share price may rise above the buyout offer if the shareholders/market think there may be a better offer come in.
• If the board does not agree, the buyer can either:
o Drop it –or-
o Make a public offer direct to the shareholders – a “hostile” takeover attempt. Then one can see what happens with the price.
• The time frame from the board being approached to a buyout offer being made public – assuming the board is in favor or the buyer decides to make a hostile takeover attempt – can be a week or two up to several months. And if the board rejects the offer and the buyer is not interested in a hostile takeover, the shareholders will most likely never know an offer was made.
Others may have more detailed knowledge/experience and may want to comment
Td - thanks! Clear answer to my question.
Could we take some aspects of this discussion off-line? You can reach me at 'jbrhema@yahoo.com' - thanks!
Bio-Pete - and MTX market exclusivity.
Thanks for the answer, but it still does not seem to have answered my basic question - which is - is there any legal possibility of anyone else entering this market before April 2016?
My understanding of some of Td's posts about this issue is that anyone else will have FDA approval delayed for 30 months before they can enter the market.
That is - suppose someone has indeed already filed or soon plans to file an ANDA and we do not know. Is it not the case that the FDA needs to respond back within 10 months? So that the fact we have seen no such FDA PDUFA date announcement - and presumably we will not see an announcement prior to August 11, 2014 [10 months after ATRS approval on Oct. 11, 2013] - means conclusively that any such hypothetical ANDA will have been filed *after* ATRS got their approval? And so any such ANDA will receive at best a tentative approval and cannot market the product until April 2016 at the earliest?
Again - sorry for my ignorance about the details of FDA regulations in this arena - so can someone educate me how this works?
Reason for my question - if ATRS and Medac are the only players allowed in the sand box until April 2016, that has to my mind positive implications for the level of Otrexup sales by the end of 2015.
ATRS $200 million shelf offering
Does anybody have any feel – based on their knowledge of and contact with the board – of the likelihood of ATRS executing some or all of this shelf in the near future? It does not seem there would be any rational reason for doing so for at least another year or two, given their cash on hand, likelihood of generating revenues with Otrexup and low share price.
But I have seen it done by small biotechs before – most notably by AEZS, which cost me a big chunk of change until I saw the hand-writing on the wall and bailed just before their 1:6 reverse split in Oct. 2012. In the case of AEZS, their lead cancer agent was denied FDA approval, and in the ensuing months/years, the board has continued to do dilutive offerings at lower prices for what I can only assume is the desire of management to keep collecting their big salaries and free options until they run the thing into the ground.
If any part of this shelf is executed in the near future, I think I would be very tempted to bail as it would signal to me either:
• Management is greedy and/or incompetent and/or
• They have lost hope at a share price recovery anytime soon based on lowering internal revenue projections and so think the current share price is the best they can do
Any comments?
And on a related note – does anybody have any feel for Hobbs’ competency and integrity as CEO? It seems on the surface that his recent tenure at Delcath was an unmitigated disaster.
Is the sales team headed LeRoux Jooste a good one? Seems Jooste was involved in lauching Enbrel and Prozac, which would on the surface suggest a high level of competency.
The reason I ask these questions is that I have seen many companies with good products and even a good theoretical plan stumble because the management team was incompetent/greedy/unethical/some combination thereof. So I think it behooves us, if possible, to have some idea what kind of caliber of team we are talking about.
Epi-pen deal with Teva
Sorry for several posts in a row, but I like to keep discussion threads limited to a particular topic.
Does anybody know where Teva is at in the process of gaining FDA approval for their generic epipen, since they settled with Pfizer and Mylan in April 2012 and can launch in 2015? It seems this should be a decent money-maker for Teva, who will most likely be the sole generic producer in this market. Teva commented over a year ago during their May 2, 2013 conference call that:
• Jami Rubin - Goldman Sachs Thank you. Just a couple of questions. …. Then secondly, not sure can address, but just curious to know your confidence level in the FDA's ability to approve EpiPen, an AB-rated EpiPen in 2015.
• Jeremy Levin - President, Chief Executive Officer: So, just to your second on question on EpiPen, I will let you know we had a settlement with Mylan and we have an entry date in 2015. The trial Is progressing well.
(source: http://seekingalpha.com/article/1394451-teva-pharmaceuticals-ceo-discusses-q1-2013-results-earnings-call-transcript?part=single )
So is it a bit strange that they haven’t gotten their ANDA into and approved by the FDA yet? Any announcement of trial results? And since TEVA is an NYSE listed stock, are they required to publish things like trial results and ANDA submissions to the FDA?
SQ MTX market exclusivity – I have another question related to FDA regulation in the SQ MTX market:
• Is it a fact that no one else can enter the SQ MTX market in the U.S. for at least the next 30 months – or is it 30 months from ATRS approval of Oct. 2013 – i.e. is April 2016 the nearest window for a third competitor to enter?
My understanding is that:
• since there are now two approved FDA SQ MTX products, and
• any other SQ MTX product would likewise have to get FDA approval, and
• there is presumably no possibility of anyone else having a secret NDA or ANDA submitted prior to Oct. 2013 that would allow them to get unrestricted FDA approval such as Medac did,
• Is it true legally that anybody else trying to join this party will be required by the FDA to defer entering the U.S. market for 30 months minimum?
I just want to know if Medac and ATRS are the only ones allowed to play in the SQ MTX market for the next 30 months minimum. Thanks!
Td – thanks and a question:
First, the question: do you know exactly what the “poison pill” provision is with ATRS?
Second – thanks for the comments. They are somewhat re-assuring. I posed my scenario based on 2 buyouts that made me some good money – NAVI in 2011 and FTGX in 2009 – both involved buyout offers that were about 50-60% over the then current share price.
With FTGX, I first picked up some at $4.60/share in late 2006, then sold in mid-2009 at $11.50/share and started accumulating GTT at < $1/share with great results thus far. I believe FTGX was in the $8 range when the $11.50 or so offer came.
With NAVI, I first started picking up NAVI at $0.43/share in 2008, and I think it was about $3.50 when a roughly $5.50 offer was made and accepted in early Feb. 2011 [I was in fact stuck in Cairo due to my flights getting cancelled during the Arab spring demonstrations in early Feb. 2011 with spotty Internet connectivity due to Mubarak trying to keep the communications cut off, so it was quite a challenge getting and keeping online long enough to get my sales orders in !] I then took the profits and piled into GTT at $1 - $1.20, again with fabulous returns thus far.
In both cases, however, the companies had been doing well and had been increasing in share price, and the buyouts represented a reasonable premium for current stockholders. That would clearly not be the case with ATRS, where I am sitting on a 50% paper loss.
Even Whogo on the YMB concedes that the Teva Epipen deal alone should render ATRS worth at least $2/share at this point. But that, unfortunately, doesn’t mean the price can’t fall even further in the near term.
A general question for any who are familiar with any ATRS anti-takeover provisions, as well as how this game works with small cap biotechs – and I apologize in advance for my ignorance:
Suppose the share price drops another $0.75 to $1 in the next month – as it has basically done this month from $3 to $2/share on fairly high volume – and we approach $1 to $1.25/share. And set aside why it has happened – manipulation through naked short selling, some big institutional holders deciding they want to unload, basic change in market sentiment about ATRS’ business model (whether justified or unjustified), etc. - just suppose the falling knife continues to fall.
Is there anything to prevent Teva or Pfizer or someone else from deciding that this is dirt cheap for acquiring ATRS and offering, say, a 50% premium to the then current share price to acquire the company at under $2/share? Any idea what the likely response would be to such an offer?
As a significant and long-term shareholder, I fully agree this would be a travesty. But is there anything to prevent it?
And why would Teva or Pfizer or someone else NOT be thinking about acquiring ATRS at these ridiculously low prices? ATRS is not going bankrupt anytime soon, and if in the upcoming Q2 report conference call they re-iterate guidance at $200 million/year by 2017 or 2018 for Otrexup, after having factored Medac into the picture, and particularly if they again project breakeven by Q4 of 2014, then the share price by any logical standard should begin to pop back up. So it would seem we are in about the best possible share price environment to encourage a buyout. So why is there seemingly no interest by big pharma partners of ATRS – who are intimately familiar with the ATRS IP portfolio and experience in getting SQ/drug combos through the FDA - in acquiring ATRS’ excellent technology on the cheap at this time?
I’m just trying to get a sense of the worst case scenario from the perspective of a long-term significant shareholder – which is – could someone come in at this time and pickup the company for a song from under our noses before ATRS has a chance to show significantly increasing revenues, maybe some partnership deals coming through, etc.?
Also – when will institutional holdings be updated so we can see if there has been significant institutional selling lately?
Thanks!
Should ATRS have partnered for MTX instead of going it alone?
There is an interesting post on the YMB by Koufax that it may be have been better for ATRS to have taken a more conservative route with Otrexup and partnered with someone - like their deal with LEO - to reduce their risk and expenditures while still leaving room for some significant revenues. I’ve got the posts below. Any reactions to this thought?
Is that pathway still open for the present board to consider?
And any comments on the rest of the thread below?
Given the likely price volatility, I am considering to designate 25% of my ATRS as trading stock and sell in the $2.20-$2.30 range and buy back in the below $2.10 range. Seems sentiment is pretty negative, so I won’t be surprised that good news – unless phenomenally good news – will be discounted in the near term. Will be interesting to see Medac’s actual pricing in October, which can then be used to revise ATRS sales guidance. I’m inclined to agree with Koufax that Medac is unlikely to get into a deep price war with ATRS since they want to make money too, and there will eventually be other competitors in this space, so they only have so much time to charge a premium.
All the best, Jbrhema
koufax62 • Jul 24 – 2:30pm
Business Model Part 1
Without question, it's viable. Building multi-product pipelines via the 5052b pathway within a low operating cost business structure WORKS and if or when the PPS falls to my buy point,,,,,,,,,I'll do just that!
The caveat is that the CEO has to push all the right buttons especially when a particular company isn't yet generating free cash Q/Q on a reliable basis. Hence the downfall of Paul Wotton. Cutting to the chase, if your going to opt on making a big cash commitment by independently selling/marketing your first product you MUST be 100% sure of the level of success of the given product. This includes being aware of "anything" in the market place that could surface and hurt you. Not being aware is NOT why a CEO is compensated as richly as they are!
Now a 20/20 hindsight hypothetical. If Antares received 10M in milestone payments along with a 50-50 revenue split agreement from Leo, what potentially would RA have garnered via a partnership? Double the Leo milestones seems conservatively reasonable IMO or 20M combined with a similar revenue sharing % breakdown. That would mean that ATRS would be NOW sitting with 100M+ on the balance sheet from the extra milestone cash and the "eliminated expenditures" now present but not needed if RA partnered. Last but not least is that less of a "total market pie" (Medac impact) would be much less of a big deal when considering the cost to get the product through the FDA to begin with.
What the above means is that PW should have stayed the conservative course and partnered RA. If that means "partnered potential" dollar wise falls to say 70M-75M annual "with" Medac in the space then SO WHAT! It cost ATRS roughly 15M-20M in total to get Otrexup to the market place. A fantastic ROI if 75M annual low risk end result.
With all that cash on hand, PW "would have" had the flexibility to open up the flood gates by running 2,3,4 new product trials "immediately and simultaneously"
Part !!
Revisiting the PW miscalculation is relevant because it illustrates clearly that he was virtually pushed out the door and that his departure is/was "not necessarily" a harbinger of doom for Antares, but an acknowledgement of a critical gaff that put the company under considerable pressure to make good on reaching profitability ASAP and then maintain and further grow, This is based on current sales trends that align closely to the FY'14 sales estimates posted/published by knowledgeable followers of the company and small bio at large. So the break even timeline still appears very much intact and on schedule.
The key Qs center on Medac's impact from ATRS breakeven EOY and beyond. What will the Medac product pricing look like? Personally, I don't see a "scorched earth" strategy coming out of Medac. The reason being is because they seem to be telegraphing a confidence that the space is plenty large enough to support volume with lucrative margins for 2 players and I suspect that even Medac realizes that the shelf life for the two companies by themselves will not last till perpetuity.(3 years maybe?) So why endeavor to kill each other?
On the settlement front, the only outcome I expect is possibly an under the table agreement (pricing and good luck proving collusion) as both parties cease litigation.
ATRS not even close to dead yet!
Trend lower?
Good for me!
Koufax
saltyboy21 • 2 hours 25 minutes ago Flag
Great posts, although to be fair, the assumption was that Sumatriptan would be marketed by Teva by now. Since it was going to be a 50/50 split, it would have provided the needed cash flow for pipeline development. When the 10K was released and noted that a CRL was received, that was a big blow to the share price... everyone has just been focused on Otrexup (which the launch is going as planned) and the lawsuit/rasuvo. While the Citizen Petition showed complete incompetency (and another reason Wotton was forced out), the main reason for the share price decline is that investors believe that all the Teva partnerships are busts, including Epi-Pen. Without any progress on Teva, Antares will likely need to raise cash or delay pipeline. The Medac situation was only a fiasco for those who were clueless. Does everyone really think that Medac (the pioneer in SQ mtx) would spend $40 million to join Antares in the US market, unless they were sure it would be profitable?
Post Wotton
by koufax62 • Jul 16, 2014 2:18 PM Flag
continuation of downtrend should have surprised "no one"! 300M MC looked like a given after he was no doubt prodded TO LEAVE while he still had a choice.
Sub 300M MC, it starts to get interesting but still tricky IMO.
Medac now factored (2H launch) break even still appears on schedule for ATRS EOY with a 50% hair cut to est peak for O you get something like from 200M to 100M for RA combined with about 60M to 30M for psoriasis for 130M reduced peak estimate factoring in Medac.
2 X 130M = 260M + cash is roughly 320M so HOW does one want to value the stock with Pfizer/QST/Teva?
Where ever the stock settles into a convincing base, I hope it stays there long enough to re-accumulate shares .That would be the best scenario for buyers in waiting vs quick reversal off oversold.
Let us hope for an opportunity.
PS 1.80-2.00 looks like a long shot to me but at this point, who knows!
GLTA
Koufax
Dr.Wotton
by koufax62 • Jun 25, 2014 12:45 PM Flag
Surprising and somewhat unexpected from my viewpoint.
Somewhat unexpected because roughly 6 months ago I suggested that an entity might approach him in an attempt to pry him away from Antares, but this observation was posted "before" the now infamous 4Q call that was IMO a genuine low light of Dr. Wotton's tenure. All he had to say was (for example) "yes we are and have been well aware of Medac and their efforts to enter the self injectable MTX space with Otrexup and we/ATRS are extremely confident in the strength of our patents that reinforce the value of our asset exemplified by our rapid response infringement suit ", That IS instead of the "never heard of them" twisting in the wind for ATRS shareholders.
The above is #1. Next is that I suspect that the BOD is or was highly peeved by the decision to in house market Otrexup vs partnership ala Leo which was an "excellent" agreement for ATRS and would have put the company in fabulous position financially moving forward towards QS T. Think about it, not to mention any risks negated albeit a route (RA partnership) potentially less lucrative then the present path.
In conclusion, I think the BOD and major holders were on his case big time exacerbated by the stock performance hence the mad scramble to land on his feet "anywhere" before he was, let us say, asked to turn in his keys.
No one is perfect, but much early on good was undone over the last couple Qs by PW.
Possible addition by subtraction going forward IMO with leadership that is responsive and more willing (flexible" to consider the consensus of opinion.
JMHO
Td - I read Loko's very informative and encouraging recent post as to why ATRS should be better positioned vis a vis IP for QST, and why this will not be as easy a market for a competitor to enter as was MTX. So here's hoping that the Teva and other deals will move forward with more vigor, and that ATRS can get the QST studies done, NDA filed and approved before other competitors enter the market - which I am sure will be very lucrative!
While I hit the 'pause' button and sold 70% of my position a week ago Monday while I more thoroughly looked at the entire ATRS situation, I have since repurchased ATRS back to almost 100% of my previous position, with the added bonus of having made about $28K on the trade. I now plan to sit and watch and see how their sales, etc. unfold. I have a call into JH to ask if Medac's entry was taken into account in the sales projections that ATRS has made in 2014 for the MTX market. Loko is pretty sure PW did take it into account.
Currently long and strong.
PS Thanks for the suggestion to move to iHub - much more rational here. YMB has too much junk to make it worth wading through anymore. Maybe things will calm down there if the next Q call is good and ATRS starts moving up.
FDA denial of ATRS CP - Thanks for the post, Cave In.
Seems clear to me that if a competitor can get their NDA into the FDA before the first applicant gets approval, and assuming they have done the appropriate clinical trials, etc., they will most likely be granted FDA approval as well - as happened with Medac.
Patent litigation is another matter. ATRS may have a better claim with their jet technology and testosterone - according to Loko, the ATRS QST will not be as easy to duplicate as Medac did with Rasuvo and MTX. But still, given how many big companies are working on SQ AI technology, and how big the field will be as it grows, I don't know if one can put a great deal of trust in IP litigation to keep competition out. Unless you truly have something innovative and write your patents as well as I understand Xerox did for his invention, you may not be able to win infringement cases in this field if your competitor is at all savvy with their device.
Therefore, I suspect in many cases it will come down to who has a good/better product, prices it well, markets it well, and succeeds in the marketplace to get the sales.
Here are some full page Antares ads in RA magazines that are pretty impressive:
Second page..... http://issuu.com/vbcc/docs/rpm_june_2014_digital/0
Rheumatology Practice Management June 2014, Vol 2, No 3
Last page.... http://issuu.com/vbcc/docs/vbcr_june_2014_digital
Value-Based Care in Rheumatology June 2014, Vol 3, No 3
Excellent reviews of Otrexup device by actual patients on WebMD
http://www.webmd.com/drugs/drugreview-165544-otrexup.aspx?drugid=165544&drugname=otrexup
Not a lot of reviews, but uniformly positive. One patient being treated for Psoriasis associated with Arthritis said:
So easy that is makes Humira and/or Enbrel seem difficult and painful. Eliminated the gastrointestinal symptoms, I had with oral MTX.
So it seems is a patient that went off Humira/Enbrel to Otrexup. Who knows - we may not only get patients going off of oral methotrexate before going on to biologics, but maybe some currently on biologics may be switched back to Otrexup.
To Lokodaug - thanks for your excellent post on the Yahoo MD! I hope you also look at this board.
I have a follow-on question about BD's injector's ability to handle viscous drugs
Do you know if the BD Physiojet AI handles viscous drugs such as testosterone, or is ATRS' injector in fact superior and perhaps the only patented SQ injector that can handle viscous drugs? That would, to my layman's mind, mean that in the case of QST, ATRS may indeed have a strategic advantage that raises the barrier to entry if there are not other similar patented SQ injectors out there that handle viscous solutions that the "Medac's" of the world could use.
Thanks again for your valuable contributions.
I believe both devices are nearly painless. They just deposit the medicine in a somewhat different way at somewhat different depths under the skin, which the judge seemed to regard as the legal basis for saying these two different devices - which do essentially the same thing - are sufficiently different to warrant each having its own patent. Both products are subcutaneous injectors that you can administer at home in an easy way.
The Medac device is produced by BD - whose auto SQ injector is used for a number of drugs. ATRS produces their own SQ injector.
Comment by Seeking Alpha author about the litigation
Do any of the attorneys on the board have any observations about the following comment by the Seeking Alpha author known as Small Pharma Analyst who wrote the detailed and generally positive analysis on 7 July 2014 called: "Antares: Uncertainty Creates An Exceptional Buying Opportunity"
This was written before the injunction was denied and Medac received FDA approval. Below is the author's comment on 14 July in the "comments" section for the article quite a ways down in answer to a post by "emra" - which, by the way, has a link to the court document detailing the judge's reasoning in denying the preliminary injunctions:
** start of author comments ****
Agree with you that the prospects for ATRS winning the litigation do not look good based on the injunction brief from the judge.
The judge set the stage early in her brief by declaring “a preliminary injunction is ‘an extraordinary remedy that should only be granted in limited circumstances.’ To be successful, a movant at bar must demonstrate: (a) a reasonable likelihood of success on the merits; (b) the prospect of irreparable harm in the absence of the injunction; (c) that this harm would exceed harm to the opposing party; and (d) that granting the injunction is in the public interest.”
Regarding Antares 631 patent, the judge concluded that Antares has a patent for a jet injector, a device that delivers the medicine under the skin as a dispersion. Medac provided enough evidence to convince the judge that their device is not a jet injector – it delivers the medicine as a “bolus” or non-dispersed mass. They had some pictures to back up their arguments. ATRS had no pictures to support their case. So, the judge concluded that ATRS had not demonstrated a reasonable likelihood of success on the merits. On the other hand, she rejected the counterclaims by Medac and BD that the 631 patent was invalid.
In her brief, Judge Robinson spent a good deal of effort in explaining her position regarding the other ATRS patent, the 846 patent which issued in April 2014 but is a re-issue of an earlier patent, 015 that was granted in Aug 2010. This patent is more broad in describing an “injection device” rather than a “jet injection device.”
But the judge argued that the reissued patent should not have claims broader than the original patent and the description and claims still fit the “jet injector.” And once again, the Medac/BD device is not a jet injector and does not infringe.
What does this mean for ATRS? From my interpretation of the judge’s brief, I see no reason for Medac/BD to settle on anything but nearly equal terms. They are in a stronger position. Both sides should settle since prolonging this litigation just burns through money. I am not going to criticize ATRS since I do not know their strategy. Perhaps all along their strategy was to sue and hope they could settle in some favorable way but Medac understood they had the upper hand and did not play along. Or maybe they have not played their full hand, waiting for the full trial – but I doubt it.
For ATRS the best case would be to negotiate a delay in the Rasuvo launch but I just do not see a significant delay happening. So I think ATRS will drop the suit or settle with some small advantage so they can save face.
I still think this outcome is baked into the share price. Regarding Rasuvo vs Otrexup, it will be two similar products, mano a mano. It should be two companies working to build a market for subQ methotrexate where both can do well. ATRS has other products in the pipeline. Some will have higher barriers for entry for competitors (the Teva products) but others no doubt will have significant competition at an early stage. They will have to find that fine line between being too secretive to protect their pipeline while providing enough information to keep investors interested.
Maybe I am too optimistic, but with new leadership at the top and a recent hire of a senior counsel, I think the company is still poised for a successful future. Staying long. Welcome other perspectives.
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