| Inception Date | June, 1999 |
| Initial Investment | $100,000.00 |
| Total Value as of 09/05/10 | $925,466.00 |
| Performance, Incept to Date | + 825.47% |
| Performance, Year to Date | - 6.45% |
| Number of Stocks Held | 11 |
Sample One | Sample Two
The following is from an email alert sent to Biotech Insight subscribers on November 21, 2004
Biotech Insight Alert 11/21/04
There are a number of events coming up in the next few weeks. I will highlight a few in the notes below.
- Rigel (RIGL) will have data any day now on their Phase I hepatitis C drug, R803, an HCV DNA polymerase inhibitor. There is no way to handicap this trial and so my advice is always to sell part of a position before the data is released—the downside is probably in the low $20’s. In the near future I expect a partnership announcement on Rigel’s allergy franchise (R112), which should give the stock another boost. I have previously sold a part of my Rigel holdings but will hold some stock for the long run. This is a well run company with a deep pipeline in potentially huge markets. See prior alerts for further information and clarification of potential conflicts.
- Cambridge Antibody (CATG) should be starting court proceedings in their royalty dispute with Abbott—expect a judgment within one month of finishing the trial (an appeal is almost a certainty). The upside could be $18 if CATG wins a full 3% net royalty. I am holding CATG.
- Genaera (GENR) will report 20mg and 40 mg dose results from the first Phase II trial in AMD by year-end. Good results could boost the stock to the $5 range. I am holding my position in GENR.
- SuperGen (SUPG) has a PDUFA date for Rubitecan on Nov.26. I don’t think the FDA approves this drug. I would consider buying SUPG if it tanks to the $4 range. The next value driver will be Decagen data at the upcoming ASH conference in early December, which I expect to be good. I don’t own SUPG.
- ConjuChem (CJC.TO) has been drifting up in front of release of Phase II combination DAC:GLP-1 metformin data in type II diabetics. We may see top-line results before Christmas. I think they will show efficacy with a tolerable side-effect profile. The stock could easily double on this news. I am holding CJC. My note of caution is that I was burned by the side effect profile before.
- Bristol-Myers (BMY) will file a BLA for CTLA4-Ig by year-end for the indication of rheumatoid arthritis. I think this gives Repligen (RGEN) a shot-in-the-arm as investors will start to focus on their IP, which can block BMY. My bet is that BMY makes some deal with RGEN, which could drive up their value to the $5 range. I am holding RGEN. Early next year RGEN will release secretin data on schizophrenia—I think this data will disappoint but secretin is not the reason to own RGEN.
- Cardiome (COM) will release top-line data from their first Phase III trial in atrial fibrillation. My take is the drug both works and doesn’t cause bad arrhythmias the kiss of death for a cardiac drug). The stock could easily double on good results. I am holding my position in COM.
- Epix (EPIX) should hear from the FDA in January. I expect an approvable letter with only the labeling details remaining. With a broad label the stock could go up to the $23-25 range. I am holding Epix. For further discussion addressing some reader questions see below.
- Pharmos (PARS) will have Phase III data from a large head-trauma trial using dexanabinol. The cannabinoids are very active neurologic agents and an antagonist (Rimonabant) is probably going to be the next mega-blockbuster if the FDA approves it. However head trauma trials are notoriously difficult to run and I really don’t believe scoring recovery using
- A number of other small cap companies have major events that are not far off. Discovery Lab (DSCO) will hear from the FDA by Feb. 13th. I think they get Surfaxin approved for pediatric respiratory distress—this could bump the stock back up to the $10 range. However, I believe trials in the larger and more lucrative adult respiratory distress syndrome (ARDS) market will be a bust. Surfactant-like drugs have not worked before in this group of patients and there is no reason to believe Surfaxin will be any better. I think the same is true for asthma as a potential indication. I am not invested in DSCO but if I were I would get out before the ARDS data is released. Adolor (ADLR) has a PDUFA date on April25, ’05 for Entereg. I think it unlikely that they get approval. This would leave Progenics (PGNX) in the lead with an IV treatment for constipation. I am long Progenics and have no position in ADLR. Atherogenics (AGIX) should have final data on AGI-1067 by year-end. I have no idea what it will show—but I bet it is controversial (especially the IVUS interpretations). I have no position in AGIX .
I had a number of reader questions. Readers asked about an article touting CT angiograms for coronary artery disease in relation to Epix (they have a new contrast agent for MRI). The thrust was how this affects the Epix story. First of all Epix is going for FDA approval in peripheral vascular beds and not the coronary artery system. They are currently doing trials to see if MS-325 can be used for MRI coronary angiography. There is a race going on between CT and MRI as a non-invasive replacement for coronary angiography. I would say that CT is currently in the lead. However this could change with new MRI software. The problem is that the current generation of CT scanners is barely adequate—even the 16 detector scanners don’t give that great an image especially of the smaller vessels. I don’t think many centers are ready or willing to upgrade to a 64 detector scanner. However the real crux for me is that CT scans, although they will always be much quicker than MRI scans, have to use a large bolus of potentially toxic contrast agent (can cause renal failure in patients with preexisting kidney disease). Epix’ new MRI agent does not cause renal toxicity even in renally impaired patients—and that is a huge plus. It is not clear yet that MRI will be the way to go but if the scans prove to be equal to high resolution CT scans (and they also give perfusion data at the same time) then the renal toxicity issue becomes a major player in deciding which technology to use. We still need to see how much contrast will be needed with the next generation CT scanners. In the meantime this whole area is not factoring into my decision to hold Epix.
Another group of readers asked about Oscient (OSCI). The company launched Factive, the newest of the quinolone antibiotics, in Sept. of 2004. The market for quinolones is in multi-billions—among the best known are Cipro, and Levaquin. Factive is more potent than all the other drugs in its class. The one downside has always been a high incidence of rashes in younger women. However recent data show that Factive can be given in a short course and with this type of regimen the incidence of rashes is even less than other quinolones. OSCI’s expenses are high due to the launch costs but a label expansion expected mid-’05 to include sinusitis should increase the market potential. Management claims they will be able to deal with Vicuron’s request for the return of ramoplanin—and I have no other comment on that. With aggressive marketing Factive could garner a good portion of the outpatient quinolone market. I am holding OSCI and expect price appreciation to the high single digits (especially if they get a SPA in place for ramoplanin).
Another reader asked for my comment on the recent Barron article about Alnylam (ALNY). I didn’t believe in antisense and I don’t believe in RNAi as a therapeutic till I see a successful trial (and I don’t mean a locally delivery trial such as intravitreal injections for AMD). Investments in RNAi companies should wait for positive clinical data. The same could be said for the remaining antisense companies and cancer vaccine companies (although we may be about to turn the corner with cancer vaccines).
Concerning Aradigm (ARDM), I don’t know why the stock tanked on a positive trial result but it rebounded the other day.
As a matter of disclosure I want all readers to know that I own many of the stocks I write about in my personal account and always maintain a long position. I am not a stock broker or a registered investment adviser. I also write about some of these stocks in alerts for BioSpace, which can be found at www.biospace.com. . Biotech Insight is a web-based newsletter published and archived at www.biotechinsight.com. Alerts and newsletters are sent electronically to subscribers. The following is further disclosure: Dr. Garren is an advisor to two funds investing in biotechnology. I recommend many of these same stocks to the investment funds mentioned above. It should be noted that certain funds go both long and short. The information in this column under no circumstances serves as a recommendation to buy or sell stocks. Please also see the disclosure about Biotech Insight archived on BioSpace.
Ron Garren MD
info@biotechinsight.com