can't vouch for the source but here's an interesting write up.
Stockprowler's pick this week is…
Trega Biosciences, Inc. (TRGA:Nasdaq)
Corporate Web site: trega.com
Shares Outstanding: 23.3 million
Public Float: 11.2 million
Insider Ownership: 52%
Institutional Ownership: (20) 14%
Market Capitalization: $90.2 million
Closing Price Friday: $3.87
San Diego based Trega Biosciences, Inc. is focused on accelerating drug discovery from disease targets to clinical candidates through its iDiscovery™ technologies. Such technologies include the IDEA™("In Vitro Determination for the Estimation of ADME (absorption, distribution, metabolism and excretion)") computerized predictive models for, among other things, the prediction and selection of compounds with essential drug-like characteristics for further development and Chem.Folio™- combinatorial libraries for screening and optimization of potential drug candidates.
Since its inception, Trega has utilized combinatorial chemistry as a foundation for its drug discovery activities. This technology has enabled Trega to develop and offer a wide range of small-molecule libraries, including its Chem.Folio™ compound libraries. In 1993, Trega used its combinatorial chemistry technologies to discover a family of proprietary compounds that appear to influence the production and activity of certain cytokines through interaction with melanocortin receptors. These compounds include HP-228, which has competed a Phase II clinical trial in the treatment of post-operative pain in hip and knee replacements. As part of its activities, the Company formed collaborative partnerships in the area of drug discovery and development. Coinciding with this focus, Trega entered into collaborations with certain pharmaceutical companies to develop compounds active against certain melanocortin receptors.
The continuing development of Trega's combinatorial chemistry libraries led to the development of information relevant to the drug discovery process, which information was regularly supplied to library purchasers. The development of this information and a growing belief in the importance of information in the drug discovery process caused the Company to investigate opportunities to acquire technologies directed at creating information germane to the drug discovery process. In 1998, Trega acquired its wholly owned subsidiary, NaviCyte, Inc., whose business included the development of products and services to facilitate the rapid screening of compounds for pharmacokinetic characteristics through the use of computer models. With the technology acquired from NaviCyte, Trega developed and released the first of the IDEA™ predictive models. The initial model predicts human absorption of drugs, nutrients, and other chemicals. Subsequent versions are being developed to predict metabolic and toxicological performance. In addition the company has combined its Chem.Folio™ libraries and IDEA™ predictive models in a collection of technologies called iDiscovery™.
On February 11, 2000, the Company announced that it did not intend to continue to support internal drug discovery programs, including its melanocortin receptor programs, that are not funded by a collaborator. Trega believes this strategic shift will permit it to better focus its efforts and resources on the continuing development and commercialization of its iDiscovery-TM- technologies. Trega is currently carrying out a collaborative program in the area of diabetes, obesity and syndrome X, which is funded by Novartis Pharma AG.
The first stage of the drug discovery process is the identification of a biological target ("target"), typically a receptor that is responsible for causing a medical condition. The second stage in early discovery is the synthesis of compounds to be screened against the desired target, followed by high throughput screening. The screening process involves the testing of hundreds of thousands of compounds to identify potentially hundreds of compounds that demonstrate activity against the target of choice. Active compounds resulting from this process are known as "hits". The hits are then chemically modified in a series of sequential steps to identify compounds that (1) have improved activity at the target, (2) are absorbed following oral administration, (3) have appropriate metabolism characteristics and (4) do not have toxic effects. This series of steps results in the identification of drug candidates. The testing used to develop the candidate is called "lead optimization," and may involve animal models, which are low throughput and poorly predictive of ultimate success. A drug candidate then undergoes preclinical development and three phases of human clinical development before being filed for approval with the FDA.
The overall process is one of attrition with a high failure rate. The early stages of the process are highly automated. Genomics is identifying many new targets at a rapid rate. Combinatorial chemistry enables the production of hundreds of thousands of compounds, while high throughput screening enables the screening of these compounds. This highly automated process, however, feeds thousands of hits into lead optimization, a low throughput, animal model dependent process, which creates a bottleneck. In addition, the traditional drug discovery process is expensive. The average direct and indirect cost of bringing a new drug to market has been estimated to total approximately $650 million. It has been estimated that over 50% of all pharmaceutical products that reach human clinical trials fail as a result of inappropriate absorption, distribution, metabolism, excretion, or toxicity that was not predicted earlier in the drug development process. Approximately $400 million of the cost of an average new drug has been estimated to represent the cost of failed drugs.
The availability of potentially millions of compounds for screening and related data combined with the sequential and time-consuming nature of traditional drug discovery methods have increased the demand for products and services which can accelerate the overall drug discovery and development process. Trega's iDiscovery-TM- technologies include its information-based products that it believes will improve the probability of success and accelerate the pharmaceutical discovery and development process. The underlying premise of iDiscovery™ technologies is to increase the likelihood of clinical success by identifying those compounds with essential drug-like characteristics at an early stage in the development process.
Trega's recent presentations at the biotech conferences in Boston and San Diego were both informative and impressive...replays may be heard here. In addition, a replay of the Trega Biosciences annual shareholders meeting is available here.
In April, Trega completed a private placement secondary offering of 3.7 newly issued shares of common stock for gross proceeds to the company of approximately $11 million dollars. Trega anticipates that the proceeds of the offering will be used to fund product development, and to acquire additional products or capabilities. On June 2, 2000 analyst coverage on Trega Biosciences was initiated by First Security Van Kasper with a Buy rating and a 12 month target of $5. Stockprowler.com believes that Trega has innovative products in a hot sector… combine that with strong alliances and solid management and you have a company that is well poised for rapid growth. TRGA closed Friday at 3 7/8 up 22% on the week. Our 12 month target on TRGA is $5 - $7… which may very well prove conservative as Wall Street discovers what this little biotech is all about. |
