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

To: Ian@SI who wrote (15168)	1/8/2005 6:52:03 PM
From: Ian@SI	Respond to of 52153

More on Abraxane from Barron's: online.barrons.com New Cancer Drug Gets the Nod While developing the anticancer drug Abraxane, Dr. Patrick Soon-Shiong faced skepticism from the pharmaceutical industry and Wall Street. Major drug firms declined to partner with his private firm, American BioScience. Investors sold short half of the free-trading shares of the firm's publicly-held subsidiary, American Pharmaceutical Partners. In the last year, shares of the Schaumburg, Ill.-based APP bounced between 49 and 21, as investors debated whether the U.S. Food & Drug Administration would approve Abraxane -- APP's reformulation of the widely-used drug Taxol. Friday, the drug was approved as a breast-cancer treatment. And it could be on the market in 45 days. "It's been a long time coming," said Soon-Shiong, happily. He believes Abraxane will be the first of many APP cancer drugs to achieve greater effectiveness and milder side effects, by replacing toxic solvents used in products like Taxol with the protein albumin. Naturally-occurring albumin might also substitute for the toxic solvents used with transplant rejection drugs like cyclosporine and Rapamycin. Said Soon-Shiong: "We believe that we have a whole new class of drugs." The idea of using albumin to carry insoluble drugs in the bloodstream occurred to Soon-Shiong a decade ago, when he was a surgery professor trying to treat diabetes with cell transplants. The transplant program failed, but he pursued the development of albumin-linked drugs with American BioScience. Generic injectable sales at APP were $370 million for the 12 months ended September 2004, with earnings of $51 million or 70 cents a share. Some of APP's profits helped its parent company fund the clinical trials of Abraxane when no one else would. By leaving American Bioscience with the rights to the albumin technology, and with 68% of APP's shares, the skepticism of the drug industry has helped Soon-Shiong become fabulously wealthy. Shares of American Pharmaceutical Partners spurted 14% Friday afternoon to 38.71 -- valuing the firm's shares at $2.8 billion -- when the FDA Website inadvertently disclosed Abraxane's approval before the agency issued a formal announcement. The Nasdaq quickly stopped trading in the shares, and both the FDA and the company were expected to announce the drug's approval on Saturday.