NorthWest Biotherapeutics Inc (NWBO)

[biosectinvestor]

In response to Exwannabe: https://investorshub.advfn.com/boards/read_msg.aspx?message_id=167573830

Again, as usual, this is ALL IMHO (in my humble opinion):

The "bear case" as you describe it, makes no sense given the actual facts as given to us in the 2017 Federal Court decision dismissing the securities fraud case made substantially on the same notions you assert and backed by Adam Feuerstein's incessantly bearish “articles” that appear to have been the basis of the claims, though they were mainly more rhetorical arguments than they were enlightening presentations of meaningful facts.

You write, ExW:

The bear case is fairly simple.

A) What happened back in 2015 was likely the exact same as what we now know happened with CVM. Upon a futility rec by the DSMB the sponsor elected to continue the trial. The FDA said fine, but you cannot ethically have patients sign the consent form at the initial screening. As with CVM, the trial continued but no new patients. And as with CVM once the trial IND was changed to have no more patient enrollment the FDA lifted the hold.

Federal Court case, dated 3/31/17 by Judge George J. Hazel, US District Court Judge, dismissing the bear case in a motion to dismiss, which the plaintiffs did not again file, though they could have done so if they believed their own case, or they could have updated their complaint before the decision in an amended and restated complaint, which they did file, in fact, but they did not bring forward things that bears, after the fact claim, now, happened subsequently. I guess, if one loses, one makes the claim AFTER one loses, that the judge did not look at the events after… not the judge’s fault, the bear/plaintiff’s fault, and they could have addressed that literally at any time but did not:

Judge Hazel writes:

Plaintiffs' additional argument that Defendants were trying to "bury" interim efficacy results is undercut by the record itself. A review of the record in its entirety leaves as the only reasonable inference that the data monitoring committee had reviewed only safety data from the Phase III trials, not efficacy data. ECF No. 22 at 34 ("We had a safety-only evaluation . . . by the Data Safety Monitoring Committee"): 35 ("Up to now. the assessments have only been safety, so this will be the first assessment for efficacy"). Plaintiffs do not establish how Defendants deliberately withheld or concealed information with respect to the interim review.

Accordingly. Plaintiffs" claims related to the Interim Analysis of the DCVax-L Phase III Trial by the are dismissed.

The full 80+pp ruling is here: https://drive.google.com/drive/u/4/my-drive

This notion of a futility finding (or vaguely unfavorable finding, failure, etc., bears have claimed it all…) that was buried and caused NWBO to commit all manner of Securities Fraud to cover it up, was dismissed for failure to state a claim, looking at all the arguments of the bear plaintiffs, quite thorougly, the court took all of the actual factual allegations of the plaintiffs as "true" for the purposes of such analysis, that’s the standard in such cases, and dismissed it all. At this point, it would have to be assumed that not only did the officers, lawyers in this case, of NWBO lie to the court, but the court was just a part of this giant conspiracy to harm plaintiff's making the bear case. That seems unlikely. Maybe also, since plaintiff’s did not file again either, and the claims persist, the plaintiff’s were in on NWBO’s fraud too?

Also, if it were true, plaintiffs would have only needed to update their complaint after the date upon which they now say the review actually took place, sometime in 2015, but after the initial claims in their complaint. The judge did not make the decision until March 2017, plenty of time. The problem is, plaintiffs Amended and Restated their complaint and could EASILY have included such additional details to cover any subsequent supposedly now later buried finding of futility and statements of the company, and there were plenty of statements by the company, that were consistent with the statements they cited in their complaint that could have easily been alleged, in the same way, as securities fraud, if plaintiff’s core allegations were true, which they were not. They could've done so any time up to now, but they have not? Why? They only make the case on social media because only social media matters to them and right now, the price is rising. So why not raise it all again? Federal Rules of Evidence don’t need to be a restraint, and the perjury worries that come with court filings, if pleadings and filings are recklessly made by those filing them, that is all for the birds when the primary forum is social media. No worries.

You write:

B) Whatever happened then, NWBO knows it. If the FDA had said anything to the effect that the trial doing so well no new patients are needed then NWBO would know they had a home run with the trial as of then. They would not been changing it to alternative endpoints and dragging in on 5+ years past when TLD would have been expected (even without an early efficacy halt). [/I]

The case referenced above discusses the addition of patients. The plaintiff’s "expert" claimed that the addition of patients meant that NWBO must have "buried the results", but that was apparently untrue given the record, according to the court. The court indicates that there was no efficacy review, according to the record, and therefore there was no effort to cover up a futility finding by adding more patients. Quite frankly, it seems unlikely that the FDA would agree to a change to the trial in that context alleged as well, or that plaintiffs could not have alleged to the SEC and FDA that NWBO had lied to the court or public about this matter, after the fact, if they actually believed it. I would not be surprised if they did not in fact allege that was the case given the SEC investigation that I’m sure was triggered by a complaint by someone in this category. Yet, no regulatory action by either agency for lying in the case of the court or to the public or their patients. But we don't have to go there, as the court says it in the quoted language above, there was no efficacy review during the period alleged.

Now the FDA is involved in furthering the alleged fraud apparently? You're saying they are making these flat out untruthful statements, given their regulatory efforts to add patients, which they really end up short of, and you're saying no regulatory agency took offense at that? Is that what you’re saying? Surely they and the other regulatory agencies would be aware of what is being claimed? I mean, the bears have called for the SEC to investigate, yet they have... no validation of the allegations of securities fraud that triggered the suit based upon the notion that the company buried or hid the findings you suggest, to keep a fraud going.

The UK is letting UK citizens pay out of pocket, great sums, to buy DCVax-L, and now allowing the company to scale up its production, and you indirectly allege the MHRA would not stop that if they surely knew what you claim to know ExW? Surely they’d be fully aware of a futility finding or a failed trial. The bear case assertion seems unlikely. That would mean the MHRA is involved too… I note that you wisely attribute this belief to “the bears”, steering clear yourself… and just sharing it.

You write:

C) Companies PR home run TLD as fast as they can for good reason. It does a lot more for advertising than tote bags. There is a reason why nobody has found a concrete example of a dev stage bio with positive P3 data not shouting it at withing a few months.

You are faulting them for being really careful because they are blinded and know there are challenges which have been openly discussed, meanwhile you're suggesting they are unblinded so that they can't fix those problems. Both of which are best left for more unsophisticated audiences. They the two Lindas and their advisors and regulators likely all could see the issues ahead and were discussing them frankly, long before any bear ever thought to file a suit related to these points.

We know there are and were other issues with the trial, the possibility that the pseudoprogression may have affected the trial doesn't necessarily mean it was determined to be futile or failed, though it could impact the data, and there could be a fear that it might be problematic ultimately in validating DCVax-L. But NWBO, everyone, became aware that pseudoprogression COULD be an issue, and something they needed to study, which they did do. But “all the patients” were living longer and almost 90% of the patients had gotten the drug via the cross-over feature, which meant that the placebo arm was confounded and the circumstances were literally perverse if the trial was in fact as successful as the published blinded interim data analysis suggests. These are reasons why one might look at the incredible survival data, consistent with previous data from Phase 1/2, and the long lives of those patients, without recurrence, and the lack of terminating events for such a long time that would enable ending the trial, and one might still conclude that there was a "home run", but there could likely still be a lot of work ahead to win approval, to show the fantastic results unequivocally, given all the challenges of the disease and the technologies leading up to this point. One could be confident yet anxious to make sure it came out alright. Assuming that just because the CEO believes that the trial is a “home run” but the TLD was not immediately released, it necessarily means the trial must have been futile in 2015 or now a failure, again, is not really a means to a factual determination. It's just an opinion. And it does not seem to be a fact based opinion if we just read the court opinion, but also as we look at the facts ourselves.

D) The attempt to change endpoints is post-hoc. Some here think that datalock is some hardline. It is not that simple. Changes to endpoints cannot be based on information from the trial. NWBO has significant data from the trial. The FDA action is huge. The blended data. The crossover numbers (that could worry them that the arm-arm OS comp would have problems). And that is only the certain known data.

You kind of blur your point here, but we know the main point is actually that you claim their SAP update was post hoc. Apparently untrue, and no indication that even bear/plaintiff’s truly believe otherwise or they’d have refiled. And no, the SAP update did not happen AFTER data lock, which your statement implies without saying.

No, as the court case determined, there was no efficacy determination, only a safety review. Additionally, the company said so and it is doubtful that any of the regulators would have accepted a post hoc update to the SAP. We know that multiple regulators have accepted it and the company has said they would not proceed until all the regulators accepted the SAP, which I presume is also for uniformity. There is no indication that anything else has happened but guessing by critics.

It was clear fairly early that a) even when all of this was a controversy, they were discussing possible alternatives to address the possible lack of a real placebo arm, the confoundment of the trial in that context, including using historical data; and b) since this was an adaptive trial, and they have a lot of trial experts infused in this effort at all levels, including the lawyer/executives directly involved, they likely knew that staying blind was a key ingredient to updating the trial as needed. It is even clearly argued in the case, and in fact argued that even if an efficacy finding were to have been sought, though it wasn’t, they’d still remain blinded. If you just read the general FDA guidance, and most likely they were familiar with it already, you know staying blind is the reality of dealing with blind trials that are adaptive. It is kind of obvious honestly to anyone hanging out in this field, even to quasi / semi-sophisticated retail investors on bulletin boards, like all of us here, frankly. There is no indication that the update was post hoc, and they could not say it if it were true, and if it were true and bears were even vaguely confident it were true, AGAIN, they could have filed suit, but they have not done so. You can’t say such things, and your regulators all know it’s untrue, and then get a favorable approval from the regulator. That’s pretty basic. All of these allegations are confined to social media. To me that suggests that they are not believed even by those making the arguments.

E) Related to A), the fact that NWBO has been in a 7 year quiet period wrt the planned 2015 IA. NWBO had no problem going to war when they accused of hiding a bad rec in 2014. They had no problem subsequently talking of an efficacy IA in 2015. Then radio silence.

And then they worked on a journal article and actually published their BLINDED interim efficacy results. You’d think nothing had happened during that period. And you know it is common to disengage from determined shorts, particularly when they align with “journalists”, because it is a no win situation. It is far better to stay silent, and the reality is, it confounds the critics and makes their job much harder. There is nothing to say, they start throwing out obviously valse allegations, and their schtick becomes more obvious.

https://translational-medicine.biomedcentral.com/articles/10.1186/s12967-018-1507-6

Further, for time relevant info going back to the bear claims in the court case, see the link in my first answer above, I'm just going to quote form the case here again, from a different place,

iii. Interim Analysis of DCVax-L Phase III Trial by
Plaintiffs next allege that Defendants" statements made in the March 7. 2014 press release. April 1,2014 annual report on Form 10-K. and December 10. 2014 Oppenheimer 25th Annual Health Conference regarding the interim analysis by the were materially false or misleading. ECF No. 22 ¶¶ 54, 56, 76. Plaintiffs allege that "the review of efficacy data by the DSMB was not pending and would easily have been completed" and Defendants "omitted that the Company did not need a formal interim analysis to make a ballpark assessment of efficacy."' ¶ 52. Plaintiffs further state that "the assertion that the analysis remained 'outstanding* falsely implied that it was in the process of being completed, when in fact it was either completed and buried, or the had been directed not to complete it." Id. | 57. Plaintiffs also claim, with respect to the January 12. 2015 remarks, that "the interim review was not scheduled to commence in 2015 but in fact had commenced in 2013 and required only a few weeks to complete." Id. 1 79.

It first bears noting that Plaintiffs cite to a December 13. 2013 press release which explicitly states, "The Company does not participate in the interim analysis process or the assessment, and both the Company and the clinical trial sites remain completely blinded." ECF No. 26-6 at 5. Thus, it is unclear from the Complaint how Plaintiffs attribute the alleged shortcomings of the safety board review to Defendants given their stated lack of involvement. But more importantly. Plaintiffs rely on the unfounded "expert" opinion of Dr. Richard A. Guarino for their contention that "there is absolutely no reason why an interim analysis could not be completed within a few weeks." ECF No. 22 \ Al. Plaintiffs may not substitute factual allegations with the speculation of their expert witness. See Fin. Acquisition Partners LP v. Blackwell 440 F.3d 278. 285-86 (5th Cir. 2006) ("allowing plaintiffs to rely on an expert's opinion in order to state securities claims requires a court to 'confront a myriad of complex evidentiary issues not generally capable of resolution at the pleading stage.* In addition, considering such opinions might require ruling on the expert's qualifications."): DeMarco v. DepoTech Corp.. 149 F.Supp.2d 1212. 1222 (S.D. Cal. 2001) ("Conclusory allegations and speculation carry no additional weight merely because a plaintiff placed them within the affidavit of a retained expert.").

The gravamen of Plaintiffs' objections regarding the interim review by DSMB appears to be that it took too long, or that Defendants somehow delayed announcing conclusive results, or concealed the results altogether. But ""Defendants, like any other company wishing to publicly discuss the results of a scientific study, had to make a judgment as to which specific bits of information about the study and its conclusions to disclose." Padiies v. Scios Nova Inc., No. C 95-1693 MHP. 1996 WL 539711. at *5 (N.D. Cal. Sept. 18. 1996): see also In re Human Genome Scis. Inc. Sec. Litig, 933 F. Supp. 2d 751. 761 (D. Md. 2013) (noting that "[w]hile it is possible to infer that. .. executives deliberately omitted facts ... in order to hoodwink investors, it is just as plausible, indeed more so. to infer that they only offered vague details about the study because it was ongoing."). Plaintiffs here do not "plead facts sufficient to explain why the defendants' summaries [or lack thereof| of the study were false or misleading." //; re Rigel. 697 F.3d at 979. Plaintiffs' additional argument that Defendants were trying to "bury" interim efficacy results is undercut by the record itself. A review of the record in its entirety leaves as the only reasonable inference that the data monitoring committee had reviewed only safety data from the Phase III trials, not efficacy data. ECF No. 22 at 34 ("We had a safety-only evaluation . . . by the Data Safety Monitoring Committee"): 35 ("Up to now. the assessments have only been safety, so this will be the first assessment for efficacy"). Plaintiffs do not establish how Defendants deliberately withheld or concealed information with respect to the interim review.

Accordingly. Plaintiffs" claims related to the Interim Analysis of the DCVax-L Phase III Trial by the are dismissed.

I'll note that this data was also released in March 2015, suggesting that even pseudoprogressors did well with DCVax. https://nwbio.com/nw-bio-reports-promising-survival-data-51-gbm-patients-treated-dcvax-l/

The bear/plaintiff’s argued that the compassionate arm also created a problem in this case, and that claim was dismissed.

Perhaps the bears were reading that compassionate arm result, and making assumptions that they must have LOTS of pseudoprogressors in the trial, bears assumed they knew the answers, that the company was hiding something, and they just needed to file suit to get the answer and win a big case, thereby proving the company MUST be lying. That apparently was not what that compassionate arm was all about. Plaintiffs claimed fraud also with the compassionate arm, only to have those claims again dismissed, though they persist in making the claims on social media to this day. However, apparently NWBO did not do this additional arm because they had a futility finding, even if plaintiffs and their “expert” thought that must be the case.

The court says so here:

v. Efficacy of DCVax Products
Finally. Plaintiffs object to Defendants' statements made at the January 13. 2014 BioTech Showcase and. to a lesser extent, the January 12. 2015 BioTech Showcase regarding the efficacy of DCVax products in general. ECF No. 22 fflf 50. 78. Plaintiffs claim that "neither DCVax-L nor DCVax-Direct had demonstrated an 80+% response rate in any well-designed clinical trial." and "neither DCVax-L nor DCVax-Direct had demonstrated a 1-1/2 year extension in median overall survival or progression free survival over standard of care in any well-designed clinical trial." ECF No. 22 11 50. Plaintiffs further state that "NW Bio had no evidence from well-controlled trials showing any 'extensions of the time to disease progression, progression free survival, and extensions of overall survival in the realm of years." Id. \ 79.
These claims are either flawed or suffer from a lack of clarity. If, for example, Plaintiffs are alleging that NW Bio falsely reported a greater-than-80% response rate for DCVax. Plaintiffs may have stated a claim. However, in their Opposition. Plaintiffs merely explain that "these representations were misleading not because of what they affirmatively stated, but because of the adverse interim Phase III results they omitted." ECF No. 28 at 40. Plaintiffs fail to show how this is an actionable omission, as they do not adequately plead facts demonstrating that an interim efficacy analysis took place or what such analysis revealed. Indeed, the only reasonable inference with respect to these allegations, as stated, is that Plaintiffs disagreed with Defendants"methodology, interpretation of the data, or expressions of optimism. In that regard, they fail to allege how these statements are false or misleading.

All of this is discussed in the court case with more specificity in the court case, though it is dense for the average reader. They clearly did not proceed with the efficacy finding, only safety. They went forward with an interim blinded review that they published, based on data they got in 2017, AFTER the case, they analyzed the data and published a blinded analysis that was compelling to most objective observers in May of 2019, though not compelling to those making the bear case still.

The company has made many statements since then that they remain blinded, some of which are below:

https://nwbio.com/nw-bio-announces-lifting-clinical-hold-dcvax-l-phase-iii-trial-fda-progression-free-survival-events-reached-overall-survival-events-not-yet-reached/

"The Company remains blinded to all Trial data, and is only receiving and reporting updates on a blinded basis."

Of course this was shortly after the company had to delist after being fully under attack by shorts and the full impact of that attack having been felt financially at that moment, including the dilution caused by the most favored nation financings with their supplier, Cognate at originally highly advantages rates that had to be then further paid and topped up in value with much lower value shares. Bears are great at pulling threads on these tiny companies to try to get them to unwind and give up their spoils. That did not happen in this case.

And the company confirmed again, apparently not lying, but if they were, bear plaintiffs know they could file a suit, yet don't.

https://nwbio.com/nw-bio-announces-completion-of-further-data-gathering-for-phase-iii-trial/

When Data Lock is reached, the independent statisticians will be given access to the unblinded dataset. The Company will remain blinded while the statisticians make the computations, converting the mass of raw data from the trial into formal tables and listings, and survival and progression measures, to report the trial results.

There was no apparent unblinding between the first statement and the 2nd that I quoted. If there was, the bears should make that known. I do not expect that they have any such information, just opinions and allegations.

You further allege:

The bull argument always winds up with stuff like secret FDA actions, being afraid of the bears, setting traps for shorts and afraid of big bad BP.

I disagree. I think it's the bear argument that seems to be far off base. The long argument looks at facts from a lot of sources, solid sources, public sources, and then we all see the bear case and evaluate it's assumptions and suppositions, that are often, as the Federal Court case indicates, baseless in reality, but strong on rhetoric, and I think a lot of us end up going with the EVIDENCE, not the rhetoric.