Yes. It is over value. Too much money chasing too few stocks take a look at Cephalon (CEPH).
They have filed an NDA for Myotrophin a drug to treat ALS (LOu Gehrigs disease. Excert from an ALS site from the net:
Amyotrophic Lateral Sclerosis, (aka ALS, Lou Gehrig's Disease, Motor Neuron Disease, Charcot's Disease),
is a neurological disease affecting the nerves that supply all voluntary muscles. ALS was first identified in
1874 by a french doctor named Charcot. It is one of the most devastating diagnoses to receive. There is no
known cure and, until recently, no medical treatment that could alter the course of this disease. Fortunately,
we now have one drug shown to extend the survival of some ALS patients, Riluzole (Rilutek), as well as
several other drugs being investigated.
ALS is a very uncommon disease, affecting about 1 per 100,000 each year. It more often affects people over
age 40, men slightly more than women. The usual cause of death is through respiratory complications.
Survival time, as well as the course of the disease (the order in which symptoms develop) varies widely.
Historically, from textbooks, ALS has an average survival time of 3 to 5 years, with about 20% of those
affected living past 5 years. The classic "Progressive Bulbar Palsy" variant has a survival time of 1 to 3
years. Let me state clearly that there are a lot of reasons not to get caught up with numbers on survival
time. First, those numbers are averages based on thousands of people and that doesn't tell us, as
individuals, how we'll do. Every individual's course is different. Second, there are documented cases of
spontaneous remission and long term ALS survivors. Third, with the availability of gastrostomy feeding
tubes, home ventilators, etc, not only length of survival, but quality of life can be extended. Finally, it's far too
early to tell what impact these new research drugs, (and others to follow), will have with early and long term
treatment.
Looks like shorting is a good idea. How many tablets/product a year
you have to sell to make $200 million? Disease only affects 1 in
100,000. Estimate at 35,000 patients total population with a survival
rate of 3 years and failing a European study which RPR was able to
make. Second to the market and they talk about $200,000,000. What is
she smoking? Maybe too many hours at the screen and too much coffee.
See ya!
Cephalon, Chiron Finally Submit Application For
ALS Drug
By JESSE EISINGER
Dow Jones News Services
NEW YORK -- Cephalon Inc. (CEPH) and Chiron Corp. (CHIR)
finally submitted
their long-awaited application for myotrophin, one of the
most controversial drugs in
biotechnology.
''Clearly it's an important milestone for the company.''
said Meg Malloy, an analyst
for Hambrecht & Quist. ''I think the odds are good for a
favorable outcome at the
FDA.''
Chiron and Cephalon are jointly developing myotrophin to
treat amyotrophic lateral
sclerosis, also know as Lou Gehrig's disease, a fatal
degenerative neurological
disorder. The companies will split sales of the drug
50/50.
The application contains data from two pivotal trials
conducted with myotrophin on
about 450 patients. New data is included as well,
concerning long-term survival and
levels of myotrophin, the name of insulin-like growth
factor-1, in the blood.
The new-drug application at first was supposed to be
filed about six months after
Cephalon made public with much fanfare the results of a
North American study in
June 1995. At the time, the company hailed the results as
''spectacular,'' as did
Wall Street, which sent Cephalon's stock soaring as much
as 95% at one point in
the day before finishing up 75% at 18 3/8. The
announcement ended a years-long
bear market in biotech stocks, spurring the sector for
about a year.
But before the company could apply for approval, the
second trial finished and the
trouble began. In late October, 1995 it made public the
results, from Europe.
Though the company claimed the trial backed up the
results of the first, some
analysts maintained the opposite.
Some analysts, notably Smith Barney Inc.'s
husband-and-wife team of Reijer
Lenstra and Toni Claudio, raised red flags. They
contested the claim that the trial
showed that the drug worked and also raised serious
questions about the number of
deaths in the trial. In the European trial, there were
more deaths in the drug group
than in the placebo groups.
A year after the original trial-result disclosure, the
Food and Drug Administration
scheduled a highly unusual advisory panel meeting to
consider whether the agency
should approve the drug under a compassionate-use
program, known as a
treatment investigational new drug approval. The panel
recommended approval of
the treatment IND, though many panel members said they
would not have
recommended full approval of myotrophin without another
trial being conducted.
The companies expect the drug to be taken up by the same
advisory panel that
recommended approval of the treatment IND, according to
Jason Rubin, a
spokesman for Cephalon. That could happen mid-year,
potentially setting up a final
FDA decision by the end of the year or early next,
analysts said.
''It's not a slam-dunk by any stretch,'' cautioned David
Molowa, an analyst for Bear
Stearns & Co., who covers Chiron.
Analysts said the drug's chances of approval may have
improved after another
high-profile drug for ALS, brain-derived neurotrophic
factor, or BDNF, developed by
Regeneron Pharmaceuticals Inc. (REGN) and Amgen Inc.
(AMGN), failed in a
late-stage trial. Only one other drug is approved for
ALS, Rhone-Poulenc Rorer
Inc.'s (RPR) Rilutek, which many analysts say has been a
disappointment.
But even if the drug is approved, it isn't clear that the
drug will sell. Once it was
widely seen as potentially a huge seller, but the
enthusiasm has tempered. If the
drug is granted only limited approval, it will be tough
sell in marketplace, said
Molowa.
Currently, there are 200 people enrolled in the
myotrophin compassionate-use
program, which provides the drug for free. There have
been close to no drop-outs,
said Rubin. Enrollment is low because of the limited
availability of the drug.
The companies continue to administer the drug in an
''open-label'' fashion to those
who were in the clinical trials. Of the 450 in the
trials, about 70 remain on the drug
today, said Rubin.
Hambrecht & Quist's Malloy, a bull on the drug, sees the
drug having potential
annual sales in the $200 million range several years out,
while in its first full year on
the market, she expects the drug to hit slightly over
$100 million.
Investors sold Cephalon stock on the news. Nasdaq-listed
Cephalon, which has run
up, especially since the BDNF failure last month, was
trading off 1 3/8, or 5%, to
26, on 970,000 shares, compared with average daily volume
of 668,000. Chiron
shares were up 1/4, or 1.4%, at 18 1/8 on about half
their average daily Nasdaq
volume of 1.2 million. |
