Type I diabetes has always been the major market for Pimagidene. These patients have the most serious form of the disease (no beta cells in the pancreas), and therefore are at most risk for secondary complications. Remember that ALL Type I diabetics are diagnosed and on therapy. Of the 14 million Type II diabetics only half are diagnosed and half of them are on drug therapy. Of those on drug therapy, many are controlled well enough that they would not be prime candidates for a treatment that is preventive in nature. Much the way Fosamax (from Merck) is doing well in the treatment of osteoporosis patients but poorly in the prevention of osteoporosis market, Pimagidene's real opportunity is in those patients who are already heading down the slippery slope of complications.
Secondly, if a company is targeting a therapy at a smaller, sicker patient population, it can usually charge a higher price. Thus, if you assume a $2,000 cost of therapy instead of $1,000 and 250K overt nephropathy patients (Type I only), the market is at least $500 million US and $1 billion WW.
This is not just wishful thinking. The ONLY way that the ACTION I trial could continue given the side effects seen in ACTION II is if the risk/benefit (side effects to efficacy) ratio is positive. Therefore, we can conclude that there is a good shot at approvable efficacy with manageable side effects in the Type I patient population.
The market consistently under and overestimates probabilities of success in situations like this. At $13, ALTN had too much good news built in. At $5 the street is discounting too heavily.
In any event, we'll know in about 6.5 months. |
