I appreciate your post and point of view. One of LGND's biggest problems has been gross underfunding and the Retinoid/Rexinoids are an excellent example. When LGND initially tried to go public in the spring of 1992, the Biotech IPO window was closed in their face. At the time, they had their osteoporosis deal with PFE, and the Biotech Boom was very rapidly deteriorating into the prolonged Biotech Bust. They went back to the drawing board and came up with a joint venture with AGN on retinoids, an atherosclerosis deal with GLX, and an exclusive license for the STAT technology (from the Rockefeller and NYU). They were able to open the Biotech IPO window a few months later in 1992, and their $11 LGNDA IPO was oversubscribed so they raised the number of shares and the stock opened at $13 and traded something like 3.25 million shares of the first day (not quite a present day internet performance, but very respectable in its day).
The AGN program quickly became a victim of its success. LGND had six retinoid/rexinoid receptors to screen AGN's library of retinoid ligands, and one promising candidate after another was discovered. To handle the large number of promising compounds, ALRT was formed. AGN put up $50 million and LGND sold ALRIZ for $32.5 million (and LGND came up with $17.5 million in cash, although some of that was from the sale of additional stock to AGN). The ALRIZ offering was another amazing story. Existing LGND and AGN shareholders got the first crack at the new stock (units were offered at $10) and shareholders could request up to 5X their allotted amount. The amount of stock available for the over allotment was small, and LGND had to mail back something like $60 million to over zealous shareholders. ALRIZ was worth well over $30 in two years and those who arbitraged the units (like Farallon) made out like bandits.
However, the $100 million in the ALRT bank account was spent at an accelerated pace, and LGND called ALRT and picked up the most advanced products (Panretin, LGD1550, LGD1268, LGD1324 - they already owned Targretin) in 1997. Then LGND did the LLY deal to fund further rexinoid development for metabolic diseases (as well as a combination cancer program and TZD programs).
When LGND did the LLY deal, I had said that the deal would transform LGND, and rumor has it that at H&Q this week DR indicated that LGND has made more progress in the first year of the LLY deal than the 4 previous years working on the other allied programs.
The latest word that I have heard on diabetes was that LLY was considering passing on Targretin and moving forward with the second generation rexinoids (LGD1268 or LGD1324) due to elevated triglycerides associated with chronic treatment with Targretin. The elevated triglycerides are acceptable for advanced breast cancer (or CTCL) patients, but not acceptable for breast cancer or diabetes prevention or diabetes long term treatment.
Befor they LLY deal, there had been quite a bit of animal models work for both breast cancer and diabetes, and the second generation compound, LGD1268, had more favorable results. |
