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Biotech / Medical : Biotech Short Candidates -- Ignore unavailable to you. Want to Upgrade?

To: tuck who wrote (288)	12/31/2002 2:40:27 PM
From: tuck	Respond to of 897

The VaxGen short is basically a bet against efficacy of its AIDSVAX B/B vaccine in PIII trials in North America. Safety is apparently OK, but efficacy is in question. A Nature article claiming the protein the vaccine targets can fold in a way to deny the antibody a binding site could be flawed; the company has said that the study used artificial antibodies against artificial antibodies, and that they and others would not have been able to get this far if it were true. In any case, the other strike against efficacy is simply timing: the company was to have halted the trial early if interim results has demonstrated efficacy. It is now slightly behind the original schedule. >>Curr Opin Investig Drugs 2001 Sep;2(9):1203-8 AIDSVAX. VaxGen. Billich A. Norvartis Research Institute, PO Box 80, Brunner Strasse 59, 1235 Vienna, Austria. andreas.billich@pharma.novartis.com AIDSVAX, a bivalent vaccine consisting of a preparation of recombinant gp120 from two types of HIV, is being developed by VaxGen for the potential prevention of HIV infection [274573]. Two versions of the vaccine are in phase III trials: AIDSVAX B/E, in phase III trials in Thailand, stimulates production of antibodies to HIV subtypes common to South and Southeast Asia, and countries of the Pacific Rim; and AIDSVAX B/B, in phase III trials in the US and Europe, stimulates production of antibodies to HIV subtypes that are found in the Americas, Europe, the Caribbean and Australia [314365], [397186]. The bivalent vaccine is based on an earlier monovalent vaccine, MNrgp120 (Genetech Inc/VaxGen Inc) [274573], [356845]. In April 2001, the independent data and safety monitoring board (DSMB) reviewed data from the trials and indicated that the vaccine appeared safe and that the trials were being conducted appropriately. VaxGen has disclosed that an average of 95% of volunteers continue to participate in the phase III trials. The DSMB was scheduled to conduct its review in November 2001, to examine the efficacy of AIDSVAX in the prevention of HIV infection. VaxGen would halt the trial early if the interim analysis shows the vaccine to be effective. The company would then begin the process of applying for regulatory approval. If the interim analysis proves inconclusive, the trial would proceed to its scheduled conclusion in the fourth quarter of 2002 [386730], [405696]. In August 1998, a collaborative research agreement was signed with the National Institute of Allergy and Infectious Diseases (NIAID). This includes research on combinations of AIDSVAX and other NIAID vaccines and research for new formulations suitable for developing nations [295166].<< The offending Nature article is authored by a number of folks who are well respected, including Drs. Kwong and Burton. Here's a link to the abstract (registration required). nature.com Cheers, Tuck

To: tuck who wrote (288)	1/1/2003 6:51:01 PM
From: Londo	Read Replies (2) \| Respond to of 897

The only problem with this move is that VXGN is on the UPC11830 list, so I wouldn't know how you would mirror this move in reality (spreads on options are insanely high). That said, VXGN will trade at around 3 bucks a share by the end of 2003. The announcement that that AIDSVAX is a bust should tank the stock 60% in a single day, and then it'll hover around 80% of their cash value I figure. I'm really surprised they haven't done a secondary offering while their stock is up in the 20's. Oh, and the 3 dollars a share assumes that they're going to raise another $50-$60M shortly in that secondary.