Replies to post #3649 on Biotech Values

[DewDiligence]

CYTR down 25% today on acquisition and highly dilutive financing:

http://biz.yahoo.com/prnews/041005/latu091_1.html

As stated previously (#msg-4073074), I would avoid this RNAi company.

[DewDiligence]

A Lou Gehrig fluffball from CytRx

[As mentioned in #msg-4073074, CytRx is *not* the way to play RNAi, IMHO.]

http://biz.yahoo.com/prnews/041206/nyfnsu13_1.html

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Two New Approaches With the Potential to Treat ALS

LOS ANGELES, Dec. 6 /PRNewswire/ -- The hopes of many that ALS (commonly referred to as Lou Gehrig's disease) will one day be a disease of the past, studied in medical textbooks, conquered by the dedication of those who have worked tirelessly to eradicate it might be realized in our lifetime.

Sixty-plus years after Lou Gehrig, the New York Yankee's "Iron Horse," succumbed to ALS (amyotrophic lateral sclerosis), comes next-generation therapeutics with the potential to successfully treat ALS in this century.

CytRx Corporation (Nasdaq: CYTR - News), a Los Angeles-based biotechnology company, is working to tackle ALS with a double K-O punch. The company is researching potential therapies for the disease using both orally administered small molecules and RNA interference (RNAi), one of the most talked-about recent scientific breakthroughs.

ALS is a disorder affecting the function of nerves and muscles. Over 5,600 people in the U.S. are diagnosed with ALS each year (that's 15 new cases a day). It is estimated that as many as 30,000 Americans have the disease at any given time, with at least 120,000 people afflicted worldwide. The life expectancy of an ALS patient averages between two and five years from the time of diagnosis, and only half of all affected live more than three years after diagnosis.

CytRx is actively seeking to treat ALS through two approaches. The first approach is the potential use of orally administered small molecules to extend the life of ALS patients. To that end, the company recently acquired several promising small molecule drug candidates, including arimoclomol, for which the company plans to initiate a Phase II clinical trial for ALS in the second quarter of 2005.

Originally developed to treat diabetes, arimoclomol was recently discovered to significantly inhibit progression of ALS in a mouse model. Arimoclomol may provide cellular protection from abnormal proteins by activating molecular "chaperone" proteins that can repair or degrade the damaged proteins that are believed to cause many diseases, including ALS.

CytRx's second approach to treating ALS is through the use of RNAi technology (a form of gene silencing), with respect to which the company has an exclusive license from the University of Massachusetts Medical School (UMMS), one of the institutions at the forefront of RNAi technology.

In October 2003, CytRx initiated a research program headed by Robert Brown, Jr., M.D., Professor of Neurology at Harvard Medical School and founder of the Cecil B. Day Laboratory for Neuromuscular Research at Massachusetts General Hospital, to use RNAi technology to target the mutant SOD1 gene, which is responsible for many cases of the familial (or inherited) form of ALS. Ten years ago, Dr. Brown was among the scientists that discovered that a mutation in the SOD1 gene can be one of the causes the familial form of ALS.

ALS may have hindered the baseball prowess of the "Iron Horse," but it has fueled the passion of researchers such as Dr. Brown and those at CytRx to try to find a treatment and perhaps one day a cure.

For more information about CytRx, log on to www.cytrx.com.
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[DewDiligence]

Another brutal PIPE for CYTR

[As previously posted here, CYTR is *not* the way to play the RNAi space (IMHO). The warrants add insult to injury.]

http://biz.yahoo.com/prnews/050121/laf019_1.html

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CytRx Agrees to $21.3 Million Private Placement of Common Stock

LOS ANGELES, Jan. 21 /PRNewswire-FirstCall/ -- CytRx Corporation (Nasdaq: CYTR - News) today announced that it had entered into a definitive agreement with institutional investors providing for a private placement of 17,334,494 shares of its common stock, with gross proceeds of approximately $21.3 million.

In connection with the sale of the common stock, the company also will issue warrants to purchase an additional 8,667,247 shares of common stock at an exercise price of $2.00 per share. CytRx has agreed to register all of the privately placed shares of common stock, together with the shares issuable upon exercise of the warrants, for resale.

Rodman & Renshaw served as the lead placement agent in the financing. [R&R seems to do a high proportion of the really lousy deals.]

"The completion of this financing will allow CytRx to focus on our planned Phase II clinical trial for ALS in the second quarter of 2005, as well as to expand our small molecule, RNAi and DNA vaccine programs in obesity, type 2 diabetes and viral diseases" said Steven A. Kriegsman, CytRx's President and Chief Executive Officer.

About CytRx Corporation

CytRx Corporation is a biopharmaceutical research and development company, based in Los Angeles with a subsidiary in Worcester, Massachusetts. The company is engaged in the development of products, primarily in the area of small molecules and ribonucleic acid interference (RNAi), in a variety of therapeutic categories. The company recently acquired 3 clinical stage compounds and a library of 500 small molecule drug candidates from Biorex Research & Development Company. The company has a broad-based strategic alliance with the University of Massachusetts Medical School to develop novel compounds in the areas of ALS, obesity, type 2 diabetes and CMV using RNAi technology. CytRx also licensed from UMMS the rights to a DNA-based HIV vaccine technology currently in a Phase I clinical trial. The company also has a research program with Massachusetts General Hospital, Harvard University's teaching hospital, to use RNAi technology to develop a drug for the treatment of ALS. For more information, visit CytRx's website at www.cytrx.com.
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[PowerPole]

Dew--Thanks for the reply...
Interesting article and comments.
I got in at the bottom after the runup two weeks ago.
Might keep a small core in case they are "the first to the finish line..."
I'm selling most of it Monday to put on something a bit more solid.
Good Luck,
Tom

[DewDiligence]

Should a state government favor a particular biotech company relative to its competitors? ALNY says, No.
The other protagonist in this story is RXII, an RNAi
spin-off from CytRx.

http://www.xconomy.com/boston/2008/09/19/alnylam-rxi-on-collision-course-over-intellectual-property-from-massachusetts-life-sciences-initiative/

› Alnylam, RXi on Collision Course over IP from Massachusetts Life Sciences Initiative

by Luke Timmerman
19-Sep-2008

Alnylam Pharmaceuticals may have to be careful what it wishes for. The Cambridge, MA-based biotech company (NASDAQ: ALNY) supported Gov. Deval Patrick’s 10-year, $1 billion initiative to boost the life sciences industry in the state, and now that it’s become law, the company says the initiative might give one of its competitors an unfair advantage.

Alnylam’s beef is essentially that the state’s new initiative could give the upper hand to Worcester, MA-based RXi Pharmaceuticals (NASDAQ: RXII), a rival in developing drugs through RNA interference technology, says Alnylam CEO John Maraganore. The new law is expected to pump significant amounts of state money into top state research institutions, like the University of Massachusetts Medical School, particularly the lab of 2006 Nobel Prize winner Craig Mello. That lab, which has done pioneering work in RNA interference, has a “blanket” agreement to provide licenses to RXi for technology emerging from its research, Maraganore says, citing RXi’s regulatory filings.

What it all means is that state money could end up strengthening a single company, which would block other companies from getting a shot at licensing the discoveries and creating jobs, Maraganore says. The issue was first aired, in a somewhat cryptic op-ed piece in the Boston Herald by Maraganore and Amir Nashat, a general partner with Polaris Venture Partners. They point out that California lawmakers nipped this problem in the bud in their $3 billion stem cell research initiative, making it clear that any intellectual property generated with state funds should be eligible for licensing to all comers, and can’t be steered to a single company, even if it has a pre-existing agreement with a state-supported lab.

“We were huge supporters of the life sciences initiative, it’s a bold and timely initiative,” Maraganore says. “It’s interested in fostering innovation, and new jobs, so IP takes on a lot of importance. Having the IP available to existing companies and to new companies on a level playing field is quite important. We think it’s important as a matter of public policy.” Otherwise, he added, “It may not foster as many new companies and new jobs.”

This issue of what to do with the intellectual property stemming from discoveries with state money falls squarely on Susan Windham-Bannister, the newly hired CEO of the Massachusetts Life Sciences Center. State lawmakers left this matter vague in the legislation, and are leaving those decisions up to the agency that will carry it out, Maraganore says. It doesn’t appear that anybody stuck a special provision or earmark into the law to specifically benefit a buddy with RXi or any other company, he says.

Alnylam has raised the IP rights issue with Windham-Bannister, and the company has had what it considers “excellent conversations with her,” Maraganore says. “She’s outstanding, she’ll certainly take this issue on. We’re very confident the Life Sciences Center will address this in a high-quality way.”

Windham-Bannister’s office is clearly thinking hard about how to get through this thicket. “A high priority issue for the Center is one that relates to the issue of exclusive licensing agreements for intellectual property developed using state funds between state-funded colleges and universities and private companies and institutions,” said Melissa Walsh, the center’s chief operating officer, in an e-mailed statement. “There is language in the life sciences law that requires the Center and its Board of Directors to review and make recommendations on this topic. We are committed to exploring the issue in a comprehensive and objective manner before rendering our recommendations to the Legislature.”

RXi Pharmaceuticals CEO Tod Woolf was unavailable for comment, according to a spokesman.

It’s likely that Alnylam’s complaint is just the first of many, says David Resnick, a partner with Nixon Peabody who specializes in intellectual property law. There are a lot of companies with sponsored research agreements at state institutions, and those deals often give them right of first refusal on technologies emerging from the research, Resnick says. “It’s probably good that Alnylam brought this up,” Resnick says. “It’s bound to come up in a number of offices.”‹