Biotech Values

[mcbio]

All kidding aside, i don't get why ECYT should be treated like a leper when there is minimal downside risk. IMO its a reasonable stock to play at these levels. If it was trading at 14 with a 400 M EV then I would agree with you.

Sorry if I'm coming across that harshly on ECYT. ; ) I do agree that a lot is obviously priced out of the stock now after the sharp haircut.

Don't you use the same logic for BIOD?

Yeah, to some degree, but BIOD is much more boom-or-bust than ECYT IMO. I could see BIOD at, or near, zero in mid-2013 or obviously much, much higher. We'll see but I have it as a small enough position in my biofolio where I can stomach the downside risk of zero while still believing that it's a big enough position and at such a small valuation where I will really benefit if they ever find some success.

The stock is priced as if the entire pipeline is dead and while the PROC indication has question marks, keep in mind that the only alternatives are PLD and topotecan, none of which demonstrated statistically significant improvement in PFS or OS. Avastin was recently approved as a front line treatment in the EU for advanced OC despite a lack of evidence of OS improvement. While the smaller ECYT trial did not show a trend in OS there were signs that the drug was beneficial in terms of PFS especially in FR++ patients. So there is still the potential of an EU approval for a disease that badly needs alternative treatments.

As for the thought that the entire pipeline is dead, if you read through the description of the drugs in the documentation on their website you can see that there are differences in the drug payload or the linker system with the intention of making the other programs more potent that EC145. Also even if EC145 ends up failing in PROC is there a particular reason to assume that it would fail in other indications? Didn't selumetinib fail in multiple indications before it showed some semblance of positive activity in NSCLC?

Some fair points in there, particularly about the lack of alternative treatments. I would add on selumetinib, though, just to keep in mind that it has shown an OS trend in Phase 2 (to go along with all of the secondary endpoints being stat sig). We'll see the magnitude of the trend at ASCO.