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Biotech / Medical : dsco Discovery Laboratories -- Ignore unavailable to you. Want to Upgrade?

To: Arthur Radley who wrote (203)	4/16/2009 10:44:10 AM
From: fred hayes	Respond to of 318

Looks like lotsa folks don't want to hold thru pdufa, that's all I can come up with. Over 8 million shares. They all can't have some kinda inside scoop. We'll know soon enuf, hope it doesn't drag out thru the weekend. Congrats to those who sold out... fred

To: Arthur Radley who wrote (203)	4/16/2009 11:05:14 AM
From: rkrw	Read Replies (1) \| Respond to of 318

This is all i found. =DJ Discovery Labs Awaiting Critical FDA Decision On Surfaxin By Jennifer Hoyt Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Discovery Laboratories Inc. (DSCO) is hoping the fourth time is the charm as it awaits a critical FDA decision Friday on the company's lead drug, Surfaxin. Shares of Discovery had surged in recent weeks in an apparent bet the biotechnology company will finally see a positive end to the more-than-four-year approval process stymieing the drug, which treats a breathing problem in premature infants. But the stock fell sharply Thursday as investors appeared to be getting skittish about the decision. Shares have more than doubled to around $2.40 from near-record lows in March but are still miles from the near-$12-a-share price they fetched in 2004. In recent trading Thursday, the shares were down 16% to $1.95 on heavy volumes. Surfaxin's already been before the FDA on three occasions and has been issued an approvable letter each time. These letters mean the FDA may give final approval, but only after evaluating more information. The fate of the company, which specializes in lung drugs, could now hang in the balance as many of its other products are much fresher in the pipeline, observers said. The good news for Discovery is that the FDA hasn't been focusing on efficacy or safety of Surfaxin in the approvable letters. Instead the agency has questioned the stability of the drug, as well as the manufacturing processes used to produce it - concerns that are much easier to address. But the years-long approval battle has battered the stock and frustrated shareholders. Discovery declined comment. However, on a November conference call, Chief Executive Robert Capetola said he believes the company has addressed all of the issues raised in the FDA's most recent approvable letter. Wedbush Morgan Securities analyst Kimberly Lee estimated the stock likely will surge to $5 if Surfaxin is approved, but could drop as low as 32 cents if the FDA issues another approvable letter. Lee said the potential market for Surfaxin is around $100 million. Surfaxin is a surfactant, which are protein lipids essential for keeping airways in the lung open and allow breathing to occur normally. Premature infants are born before enough natural surfactant has developed in their lungs, which causes their air sacs to collapse. "They cannot get enough oxygen in their blood to support their brain and other vital organs and they can't get carbon dioxide out," Capetola said at an April conference. Analysts say the potential for Surfaxin lies in the fact it's synthetically produced unlike most other surfactants, which are derived from animal-based products. Surfaxin's synthetic make-up has the potential to make it more safe and effective than other surfactants, Lee said. "Surfaxin is the first completely synthetic surfactant to perform as well as or better than animal-derived surfactants," Lee wrote in a recent note. Dave Fondrie, senior vice president and portfolio manager of Heartland Funds, a long-time investor in Discovery, said Surfaxin's approval process has been disappointing. But Fondrie said his fund has stuck with the company due to a belief in Surfaxin's potential. In particular, Fondrie likes the opportunity for Surfaxin to be used in aerosol form, which would be safer for patients than using tubes to inject the drug. Fondrie said the FDA is likely to approve the drug this time, but if it doesn't, he added, he believes Discovery probably won't have enough capital to go another round and will be forced to sell the company. Lee, who put 50-50 odds on Surfaxin getting approved, said the company can survive another approvable letter, particularly if the issues the FDA raises are minor. But she questioned the company's ability to survive if these issues surrounding Surfaxin last another year. Meanwhile, Jefferies & Co. analyst Marko Kozul said in a March note that he believes Surfaxin will get approval on this attempt. Discovery has other opportunities in its pipeline, including Surfaxin for the treatment of bronchopulmonary dysplasia - or chronic lung disease - which affects premature infants, and an aerosolized version of the company's Surfactant Replacement Therapies. These products, however, are in earlier stages than the version of Surfaxin currently up for FDA approval. -By Jennifer Hoyt, Dow Jones Newswires; 201-938-2474; jennifer.hoyt@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: djnewsplus.com. You can use this link on the day this article is published and the following day. (END) Dow Jones Newswires 04-16-09 1021ET Copyright (c) 2009 Dow Jones & Company, Inc. - - 10 21 AM EDT 04-16-09