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Replies to post #305153 on Elite Pharmaceuticals Inc (ELTP)
12/02/18 11:28 PM
Senderos, thanks for the question. You have an accurate grasp of the changing environment and future for Elite. Relatedly, here are my business observations...
In 2016, with the lead up to what became the CRL, Elite itself was speaking of SOX as the proof of concept for its line of ADF drugs. In fact, the much heralded statement born of that seeming commitment was the enthusiastic but misapprehended statement by Nasrat that their generics were "breadcrumbs." In my opinion, a CEO should never downplay any revenue stream with words that make it appear irrelevant. So, when the CRL for SOX occurred, it appeared as if Elite was a one-drug wonder that had been handed a mortal wound.
While I have been accused of "selling or pumping" I have never told readers to invest; I do not do that. If one were to look at my posts clearly, they will see I have criticized the company at various times and one of the criticisms was that, as a generic drug company with cost as its strategy, they sought to file an NDA for SOX which is a differentiated drug. I believed they should have stuck to the knitting and pushed out ANDAs; which is more consistent with their strategy of cost. Moreover, I was critical of the singular approach to drug development. With the focus on opioid abuse, I saw a very limited future; at least until the FDA made efforts to embrace small ANDA producers of opioids. And, that is happening. But still...
My great concern was that, as a small generic company, Elite needed more and different drugs to ensure its pipeline and company growth. So it is that I embrace the SunGen effort that does just that. In addition to the CNS drugs & antibiotic ANDAs that offer significant revenue opportunities, they have created the partnership with Glenmark to aid in commercialization and, as we learned yesterday, they are looking to commercialize the SunGen co-developed drugs through Sungen's jointly established DBA Peterson Pharmaceuticals with Buffalo-based Peterson Pharmaceuticals LLC, created in September 2016. The DBA joint venture became the marketing and sales arm of Sungen Pharma. And, of course, SunGen's parent company (HUNAN JINGFENG PHARMA ) has the reach into China that was referred to by Nasrat. Finally, there is the wild card - Isradipine.
What it means, in sum, is that with the SunGen CNS drug approvals that seem in the offing due to the inspections, along with the pending approval for Norco, that Elite has the revenue potential to let the very good direction provided by the FDA on SOX to run its careful course because, despite the irritation of the seeming delay, it remains that an expensive set of trials for SOX will be easily paid for out of the revenues from the SunGen and Glenmark commercialized drugs.
With all the above, it is why I no longer view Elite as simply looking for a couple of approvals to sell the company. I have changed my mind...I REPEAT...I HAVE CHANGED MY MIND (which is what strategists do to align with the opportunities) based on what I see. I now believe Elite will move forward and, should Isradipine turn out to be THE drug to use against Parkinson's, Elite will uplist to the Nasdaq; which will allow the institutional investors to move the p/s as was moved by the much talked about Jazz Pharma...from pennies to today's price of about $150 p/s. Given the potential, it is something to consider.
AI
