Since your trading your old mantra, “small sample size” for your new mantra “cost cutting”, I thought I’d throw out an alternate thesis:
Management knows Purisol results beat Otezla, and Leo plans to keep it, or at least move the puck further down the ice.
With B-OM and B-UP needing further delivery development, the deals under consideration may be more back-end loaded. They need that $12M + $2.7 payable to the CRO for the 2b, + the 3 other B-derm indications, and a K bridge trial and maybe another open label. They will still have to be fiscally prudent to accomplish all of this. Definitely cut staff not related to clinical trials. Why maintain a staffing structure that doesn’t support your strategic objective? If they were about to be rolling in it, you think they’d still be lining Menon’s pocket. Dr M is not a money grubber. He gave up half his stake in the company without a fight. Dr. B has the expertise necessary to develop the derm applications.
They are going to keep P for two reasons:
1. They can handle a P phase 3. The 505(b)2 pathway “abbreviates your phase 3 program,” and “makes it a lot easier to come across the finish line.” To quote Dr. B from his conference presentation. He spent 4 minutes on an upbeat presentation on P. Why? If he knows it’s failed?
2. After P beats Otezla in this 2b, imagine what it will do head to head at 12 weeks! And then, what is the jump in value creation from a comparable phase 2b to a head -to-head smack down phase 3?
Here are my tea leaves:
1. Signal in P2a
2. Mgmt gets Case ReportForms, knows overall blinded results
3. Expands trial sites after 70% enrolled, while delaying B-OM until saw results
4. Upbeat Dec 21st P/R. “ A novel psoriasis drug, particularly one that is oral, safe and effective, would expand patient and physician choices for treatment and likely would command significant market value.” Who would say this knowing they had a failed trial?
5. Upbeat Dr. B presentation. “Makes you think it’s going to work even better when you go the registration population.” “Anxious to see what those results are.”
6. Mako/Rosen past would discourage setting any known false expectations.
7. Blind likely not yet lifted, yet 10Q calls for $12M in trial cost…P phase 3?
8. P would fit nicely into a Derm company with B-Acne, Atopic Dermatitis & HS.
