Hello sds,
I'm not sure we're too off on the data. maybe it's a glass 1/2 empty vs 1/2 full issue.
Strictly from memory, I believe the IMS scripts for gancyclovir oral and IV, foscarnet, and cidofovir (competitive CMV retinitis therapies) are tracking $80M aggregate annual run rate, and the number has stayed constant for the past two years, though trending downward, slightly. Since IMS scripts represent about 2/3 of the US market, maybe a $120M annual market for these therapies. Add $20M (?) for the gancyclovir implant, you get $140M spent per year in the US on CMV retinitis therapies in the US, with a small trend downward.
So, how competitive is fomiversen? Good efficacy, good tolerability (sure, I don't want a poke in the eye, even a little pinprick, but I don't have CMV retinitis either ... no significant issues with the method of administration in the trials). The other products apparently are very toxic. Oral gancyclovir has limited efficacy, though it's more tolerable, and the gancyclovir implant, while it has good efficacy, it leads to retinal detachments in a significant subset of the patients, and it's quite expensive.
With the Ciba deal providing for an attractive return for ISIP (50-60% of the profits), with an assurance of some return due to a transfer pricing mechanism (e.g., not a pure profit sharing deal), and with the product now in the black (Eisai payments + Ciba payments will cover the cost of development), fomiversen will be a modest money maker for Isis. Not a product they would develop now, but the product works, and will be profitable.
I haven't run the numbers, but my opinion is an attractive therapy in Crohn's disease is a significant product ... not by big pharma's reckoning, perhaps (e.g., not a $500M + product), but serving a multi-$100M market.
You're right, I wouldn't factor in any value for 2302 in RA (probably doesn't work well enough), or in UC or kidney transplant (too many unknowns). Psoriasis has a nice upside, but it will need to be a topical formulation, and it may not be a first generation molecule ... so don't place a value there.
Cancer, I'm not as pessimistic as you seem, but we clearly don't have enough data to tell us whether either of the three have the potential to be a big drug ($500M +).
Net, net, while I believe the assets of the company (technology, discovery engine, intellectual property, products under development) are worth more than the market values them today, and I also believe Isis has the potential to be a very big winner long term, I also believe that for there to be a significant inflection point in the stock price and a long term run up, the market will probably need to see credible clinical results in a signicant indication where Isis has retained significant rights. But, this isn't new news.
The company appears to be firing on all cylinders ... not sure, though, when the capital markets will re-evaluate and step them up in value, and not sure when they'll hit that inflection point and begin that long ride upward to much higher levels. While there's still risk, I think both are likely to happen. Just my two cents, of course.
Peter |
