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Biotech / Medical : QLT PhotoTherapeutics (QLTI) -- Ignore unavailable to you. Want to Upgrade?

To: Ian@SI who wrote (859)	3/30/2000 11:26:00 AM
From: Julian	Read Replies (1) \| Respond to of 1321

Christine Charette Nesbitt Burns - Biotechnology analyst (416) 359-6190 March 29,2000 QLT Announces Two-Year TAP and One-Year VIP Data [condensed version] Event: QLT announced the top-line results from Visudyne's two-year TAP and the one-year VIP trial. Impact: Neutral. Visudyne's treatment effect in predominantly classic AMD patients is maintained at two years. There was no statistical difference on the primary end point between treated and untreated patients in the occult AMD patient populations in the two trials. Pathological myopia patients had a treatment benefit at one year. This data requires no change to [our] model at this time, although when the detailed analysis comes out at AVRO on the number of patients still being treated at two years, we may need to add a third year of treatment in our model. Details: The TAP (Treatment of AMD with Photodynamic Therapy) findings were based on 24-month follow-up data form 609 patients with wet AMD. The results released yesterday show that Visudyne has a sustained benefit over two years with no additional safety issues and fewer treatments in the second year. The results were excellent, showing that 59% of patients using the Visudyne therapy maintained vision versus 31% on placebo. In the second year, patients received an average of 2.1 treatments versus the 3.4 treatments received in the first year. Analysis: The importance of the number of treatments in year two cannot be overemphasized. First, since the patients received a lower number of treatments compared to year one, treatment will only last a limited period of time and patients will not have to commit to a lifetime of quarterly visits to the ophthalmologist. Second, some patients will be treated for a second year, therefore making the market more attractive than if we treated for only one year. On the conference call [we] learned that some patients were still being treated at the end of year two, therfore making it likely that some patients will receive a third year of treatment. Although [we] are currently carrying two years of treatment in [our] model, we are not carrying a third year. If the number of patients who are still on treatment at the end of year two is substantial, it could have a positive impact on [our] sales model when the details are released at ARVO. [We] believe debates about the potential market size to be misplaced. Estimates range from 35% of patients who will eventually have +predominantly classic AMD+ to 60% at the high end. [We] are very comfortable in our sales estimates based on the low end of this range, as we expect a very deep penetration of the predominantly classic market given that AMD is a well diagnosed disease, no option exist for these patients and the outcome is serious if left untreated. Very few drugs have this kind of profile. Going forward we anticipate the new to be positive. [We] expect the FDA approval in April. The detailed data at AVRO may have a positive impact on [our] model. The initial sales data for Q2 should remove any doubts regarding the potential market size for this drug and should have a strong impact on the share price. Recommendation: [We] continue to rate the stock as a Top Pick with a $125 target price. [We] recommend purchase on weakness.