GTC Biotherapeutics (fka GTCB)

[DewDiligence]

>Dew, given your propensity for handicapping and quantitative methodologies, would you be willing to put some odds on these events?<

My probabilities are given below—better late than never!


>1. Shareholder vote on proposed financing from LFB: [Approved 75%; Not approved 25%]<

This is roughly what I thought when you posted on Nov 14; however, I now handicap the outcome of the shareholder vote as follows:

• All proposals pass: 89%. (This includes the case where GTC implements a reverse split before the voting, rendering Proposal #3 immaterial.)

• #1 and #2 pass but #3 fails; GTC then renders #3 immaterial by implementing a RS after the voting (what I’ve referred to as the “nuclear option”): 8%.

• #1, #2 or both fail, killing the proposed financing: 3%.


>2(a). FDA advisory panel for ATryn BLA: Jan 2009. [Majority Vote for safety and efficacy proved 40%; Roughly equal panel 25%; Majority vote for safety and efficacy not yet proved 25%; administrative or other delay in panel review 10%]<

I assume that the panel will conduct separate votes on efficacy and safety. Also, I’m ignoring the case of an administrative delay because the panel can presumably be rescheduled without undue consequences for GTC. My probabilities are as follows:

• By a strong majority, the panel believes that efficacy and safety have been proven: 52%.

• By a strong majority, the panel believes that efficacy has been proven; however, the panel vote on safety is roughly split or negative: 34%.

• By a strong majority, the panel believes that safety has been proven; however, the panel vote on efficacy is roughly split or negative: 2%.

• By a strong majority, the panel believes that neither efficacy nor safety has been proven: 12%.


>2(b). FDA PDUFA date for ATryn BLA: 7-Feb-2009. [Two questions here: Delay beyond PDUFA date, Yes 65%; No 35%. Positive marketing authorization on first review 30%; request for more info/another trial etc 60%; rejection 10%]<

Lately, hardly any applications have been decided on or before by the PDUFA date because the FDA is grossly understaffed; with this is mind, my probability of an FDA decision on or before the 7-Feb-2009 PDUFA date is 22% (vs your 30%).


On the more important question of how the FDA will act on the BLA itself, my probabilities are as follows; (of course, these numbers are subject to change based on the outcome of the panel meeting):

• Approval: 42%.

• Request for additional data without new clinical studies, incurring a delay of several months to a year: 30%.

• Rejection or request for new clinical studies: 28%.

JMHO, FWIW