Biotech Values

[biomaven0]

What if something strikes out of the blue

Something can always strike out of the blue, which is why I don't count much in the way of chickens for 1st/2nd line use. But for 3rd line use, there is nothing else, so even if there is some unexpected new side effect it would have negligible impact on 3rd line use. The alternative for these patients is a bone marrow transplant with substantial mortality and morbidity.

Generic Sprycel

The Sprycel patent runs until 2020. It's a novel compound, no re-patenting issues. Filings by generic companies are a dime a dozen. If BMY was truly concerned about the patent they would settle and knock a few years off the date. In the big scheme of things I don't even view this filing as a rounding error in figuring ARIA's valuation.

Reimbursement policy

The issue is that the companies cannot deny the drug to patients who are resistant/intolerant to Gleevec - that would be tantamount to killing them. So even under more restrictive reimbursement settings, the fight would be over 1st line for high-risk patients, not 2nd or 3rd-line.

Obviously nothing in biotech is a lock - someone could come up with a cure for CML tomorrow. That's why I diversify.

Peter