Replies to post #3617 on Repros Therapeutics Inc (RPRX)

[io_io]

Corpstrat - that's a good post.

Personally I don't believe Clark's (reflecting on the DewD "program survival bias" BS) mantra about "overwhelming" bad biotech trial design has much basis in reality:


1. Most Phase 2's are relatively small, and very few reach stat signif - the actual result should then be not considered reliable of effect, or even reliably that there is an effect. It just establishes a candidate and a dose, etc. And yet a Phase 2 with a signal, but without proof, MUST be tried in Phase 3 TRIALS, and with uncertainty.

2. The Phase 3 trials should then not be considered as "confirmatory" trials (maybe only the 2nd confirms the 1st), but instead are simply the real "TRIALS" - the biotechs dont know the real effect until the TRIALS are done. They are TRIALS, not formalities. Notice how in some such trials, significance is achieved very easily?

3. In the Phase 3 trials, cash, time and recruitment are all issues.

4. Also, there is clinical effect. Design the trial to make it more comfortable statistically is a waste of time in perhaps the majority of cases, as this means a smaller clinical effect, and most diseases or conditions already have a treatment, and some are possibly generics, etc. (note: this applies to Proellex, where Lupron already exists)

5. Then there is the trade-off with safety. Design a bigger trial, say in combination therapy against an approved drug, and if the clinical effect is small, you may not get approved if the safety issue over-rides.


So when you subtract all of these optimally designed trials from the mix, you don't have too many left. How many do you know if ? One per year ? Certainly when do you hear CEOs moaning about not enough power ? Hardly ever.

Personally I think that any message-board poster who makes these broad-brush statements about the industry - which is backed by talented people actually thinking and working on these drug projects - and also backed by tens or more of millions for each drug - is either naive or thinks the readers are naive.

[iwfal]

i know, but you surely need to take account of the mkt cap and the potential value of Proellex in your invesment decision here.

All valid points. Expected value is a meaningful investment metric - but I shy away from it because I, and I suggest most investors, overestimate the probability of success in large part because of the tendency of management to see and PR the good aspects, but forget the risks. Humans focus on the data they have and the data that supports their needs - but forget or undervalue the data that they don't have or doesn't support their needs.

So I focus on risks as a way to control that. Get hard data that argues the other side. For instance I would naively give the anemia trial 50% chance of success - but I know that traditionally I give odds that are too high because (generically) I haven't considered that management was naive about eastern europe, or subgroup analysis or Program Survival Bias or ... . (these examples are not meant to be about Repros per se - just examples)

Anyway, when push came to shove, did all that brilliant thinking lead to stronger predictions - and of what? I'm genuinely asking your recall and opinion. You may just be missing the intellectual stimulus rather than risk reduction through insight?

A valid question - but see above answer. As for what I learned from looking at the data - that the interim for DNDN is risky despite it being (per Dendreon mgt) "Well powered". And that has changed my investment approach.

The bummer is that for whatever reason the negativity holds down the pps and makes funding challenging. It becomes a self-fulfilling FUD.

Agreed that the self fulfilling nature of the short attack is frustrating. What surprises me is that there aren't some successful big long funds who sort the wheat from the chaff and provide the funding for the good candidates - and then eat the shorts alive by mirroring the same tricks back on the shorts. My guess is that there just aren't enough sure-fire biotech winners to justify developing the expertise in ripping the shorts?

But frustration aside - I can't complain in that the shorts stupidly drive down good management and give me an opportunity.

Clark