Biotech Values

[mcbio]

BIOD - 3Q11 CC notes (8/4/11)

1. Interesting call in that BIOD spent a lot of time discussing their pre-clinical work on improving existing insulin analogs. This is the first time I've heard them discuss this, as I thought their main efforts were related strictly to tweaking just recombinant human insulin, which is what they appear to be doing in their new Linjeta formulations (BIOD-105 and BIOD-107).

2. There was specific discussion that BIOD has obtained API from a major pharmaceutical company in conjunction with their development of an improved version of the existing pharma's human insulin analog. There was separate reference in the call to dealing with Merck (Organon), but I believe that was just strictly in relation to purchase agreements pertaining to recombinant human insulin and not an actual insulin analog. (I assume BIOD is working with another pharma with respect to the insulin analog.) In exchange for obtaining the API from the major pharma, BIOD has granted the right to license the improved insulin analog to the pharma on an exclusive basis.

3. BIOD specifically talked about trying to develop better analog versions of Humalog, Novolog, and Apidra. So, I assume the major pharma API supplier they referred to is either LLY, NVO, or SNY.

4. Regarding 105 and 107, the tweaks on recombinant human insulin, Phase 1 studies were completed earlier (curious that BIOD didn't issue an actual PR in conjunction with this). 105 and 107 showed absorption after about 15 and 16 minutes, respectively, compared to 23 minutes for Humalog in this specific study. Also, metabolic effect for 105 and 107 tended to be higher in first hour after injection compared to Humalog although difference was not stat sig. Regarding tolerability, no statistical differences in visual analog scores between 105, 107, and Humalog (this was an issue for Linjeta). Frequency of mild or no discomfort from injections was 94% for 105 and 100% for 107 and Humalog. 88% of 105 injections and 100% of 107 and Humalog injections showed similar or less discomfort than usual meal time injections at home. (Looks like 107 has the better tolerability.)

5. BIOD expects ongoing 105 and 107 Phase 1 pump studies to be done in September with results in October, which is ahead of schedule. BIOD is not moving into potential Phase 2 trials on the subQ formulation until they have the pump data and have further clarity from the pharma company on the improved insulin analog. (Sounds to me like BIOD is hoping for a package deal on the insulin analogs and the recombinant insulin or maybe they are hoping for an outright offer at that time.) BIOD expects to provide specific update on the path forward during 4Q11 (believe they were clearly referring to calendar, not fiscal here).

6. BIOD expects existing cash to fund operations at least through the first half of fiscal 2013 (March 2013).

7. Future Phase 2 trial for either 105 or 107 would cost no more than $5M.