Thanks TD.
I sow street.com article and my opinion is that J.E. is poorly informed freak who combine rumor and other people lead info (without confirming words and rumors) in to final *his* facts. His reports from H&Q speak for itself.
Extract from article:
>>NeXstar's (NXTR:Nasdaq) antifungal drug Ambisome doesn't seem to be catching on.
On Oct. 16, the formulary committee of the University of Wisconsin Hospital & Clinics
recommended against use of Ambisome in favor of two competitors. The committee placed "strong
restrictions on the drug," says Lisa Brunette, a spokeswoman for the hospital, determining through
an in-house study that "Ambisome does not offer significant clinical differences over two other
lipid-based products such that the additional cost would be justified."
Wham.
Launched last month, the drug is priced much higher than its two other lipid-based antifungal
competitors, Sequus' (SEQU:Nasdaq) Amphotec and Liposome's Abelcet. All three drugs
incorporate a common antifungal drug called amphotericin B in a fat, formulations that supposedly
reduce side effects and, perhaps, increase efficacy.
The policy decision was sent around hospitalwide email, says Brunette. Competitors say that other
hospitals around the country have made similar decisions in recent weeks.
NeXstar officials were not immediately available to comment.
Ambisome has a broader label from the Food and Drug Administration than its competitors, which
had led the company to charge more and is supposed to translate into market dominance. At least
initially, that seems like a no-go.
Ambisome is priced at about $900 a day, according to Craig Henderson, the chief executive of
Sequus. His company's Amphotec costs about $240 a day, while LIPO's Abelcet runs around
$400 a day.
Ambisome has the lion's share of the European market, which is placed at roughly $80 million to
$90 million. Ambisome's been on the market for about five years, way ahead of the competitors.
Henderson says the market in the U.S. is currently around $65 million to $75 million a year, well
below what bullish analysts such as Ostro at UBS had projected. The market is not expected to go
much higher.<<
Troubled points:
1. >> The committee placed "strong restrictions on the drug," says Lisa Brunette, a spokeswoman for the hospital, determining through an in-house study that "Ambisome does not offer significant clinical differences over two other lipid-based products such that the additional cost would be justified."<<
By any means there are NO comparable studies (efficiency versus treatment cost) for three liposomal Am.B or each liposomal formulation versus Am.B. NXTR/Fujisawa are conducting such trials
The facts are that AmBisome has equal or better efficiency than Am.B in many indication, Amphotec is more efficient than Am.B in lungs Aspergillus infection but worse in other indications, and Abelcet is worse than AmB in all indication (equal in Aspergillus). So hospital has its on efficiency data??? Everyone should understand that they do not make money by paying higher price for better drugs. Instead they prefer longer hospitalization and expensive equipment usage.
2. >> Ambisome is priced at about $900 a day, according to Craig Henderson, the chief executive of Sequus. His company's Amphotec costs about $240 a day, while LIPO's Abelcet runs around $400 a day.<<
If Amphotec is ~65% cheaper than Abelcet (and has some efficiency) why they didn't also vote against Abelcet??? Also why Abelcet (more expensive drug) still have some quaternary sale if the drug is more expensive than Amphotec???
In EU and worldwide AmBisome is ~20% more expensive (in 97 overall AmBisome price decline ~10% to meat competitor price) and still they keep ~80% market share. I do not know Fujisawa market price for AmBisome, but my guess is that it is 30-35% more expensive than other two. This is normal because they have FDA approval (reimbursement policy) and AmBisome deserve higher price. Street.com recommended SEQU (I also have small position on SEQU) and article has expected premise.
One other thing. LIPO SH will be very disappointed with LIPO financial report for 4Q. Their margin will be lower with new plant operating at small % capacity and 30% decline in Abelcet market price. NXTR have second AmBisome plant at San Dimas on-line (FDA expected and approved) which will have better performance and make AmBisome more competitive.
So one more time, good luck to all shorts.
mz |
