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Biotech / Medical : Ligand (LGND) Breakout! -- Ignore unavailable to you. Want to Upgrade?

To: Cheryl Galt who wrote (28290)	2/21/1999 6:24:00 AM
From: Henry Niman	Read Replies (1) \| Respond to of 32384

Cheryl, I've answered your questions previously, but I'll give it another try staring with the science and technology. All three rexinoids (Targretin, LGD1268 and LGD1324) activate all three RXRs (alpha, beta, gamma). They are classified as rexinoids because the don't activate the three RARs (alpha, beta, gamma). The various receptors are involved in different processes (and the RAR activation has been associated with elevated triglycerides). The two rexinoid that had not entered the clinic (LGD1268 and LGD1324) were called second generation because the had a stronger affinity for the RXRs. However, I don't think that they were more selective (they still activated all three RXRs). For type II diabetes, PPARgamma combines with RXRalpha. Thus to specifically target that disease, a rexinoid specific for RXRalpha (doesn't activate RXR beta or gamma) would be desirable. Thus, LGND is using a more strict definition of "second generation", which means that the compound is more restrictive in subtype activation. Since the specific compounds are not defined, that is one definition of "second generation". I had heard that a problem with Targretin was its in vivo conversion to a metabolite that does activate RARs. Elvelated triglycerides is a common side effect of retinoids (vitamin-A derivatives that activate RARs). Thus the "second generation" terminology may apply to compounds that don't metabolize into RAR activating compounds. When LGND split up the AGN, AGN had the more specific rexinoids. However, there were hundreds of molecules split up, so I'm sure that LGND has its own sub-type specific compounds. Although LGND gets a royalty from AGN's compounds, they would get more from the ones that they develop, so they are not going to give AGN and WLA (and everyone else in the world) the details behind the "second generation" compounds. The LGND/AGN joint venture was grossly under-funded. The initial $100 million was used up well ahead of the initial 5 year time frame, and drug development is very expensive. The LLY deal allows LGND to make considerable progress. AGN has no rexinoid in the clinic, so I don't think that LGND wants to give out info that will help AGN beat them to the market. I think it's clear that many of the readers of this board still lack a clear understanding of the science and technology behind drug development.

To: Cheryl Galt who wrote (28290)	2/21/1999 6:40:00 AM
From: Henry Niman	Respond to of 32384

As far as LGD1268 and LGD1324 rights are concerned, the latest press release really says nothing new. LGND has a research program with LLY to combine rexinoids with SERMs to treat breast cancer. This program targets the more advanced compounds. LLY has a second generation SERM (their first generation compound is Evista) and LGND's second generation compounds have yet to be named (could be LGD1268 or LGD1324 or one of the "second" generation compounds being explored for diabetes). I do not believe that this program is planning to use the only rexinoid in the clinic (Targretin) or the most advanced SERM on the market (Evista). Again LGND and/or LLY do not want to give out too much detail on their research program. There are two approved SERMs (ZEN's Tamoxifen and LLY's Evista) and several in the clinic (PFE's Droloxifene and CP-366,156, SBH's Idoxifene, and AHP's TSE424) and AGN/WLA are working on the rexinoid side of the Rexinoid/SERM combo. (According to the latest Bear Stearns' Bottle Report, "Go/No-Go Decision for SBH SERM for Osteo (Idoxifene) Expected After Reviewing Phase 2 Data in April".

To: Cheryl Galt who wrote (28290)	2/21/1999 6:57:00 AM
From: Henry Niman	Read Replies (2) \| Respond to of 32384

Your third area of confusion concerns Targretin revenue, which I have already explained very recently, but I'll try that one again also. Biotechs can generate REVENUE through licensing agreements. LGND has a presence (offices) in the US, Canada, and Europe. Cancer is a worldwide problem. Thus, approval of Targetin for cancer will create a need for someone to sell the drug in areas not targeted by LGND (like Asia which is where Japan is). LGND plans to license it to third parties. I believe that LLY had worldwide rights to use of Targretin in metabolic diseases such as type II diabetes. Treatments would involve chronic use of the medication, and pricing would be considerably less than Targretin for cancer. When LGND negotiates a distribution agreement, the third party obviously must look at the market and margins. If they license Targretin for cancer and plan to sell it at $20 per pill, they have to worry about LLY (or one of their licensees)coming in a few years later and selling Targretin at $2 per pill for type II diabetes (a much bigger target population and Targretin costs pennies per pill to manufacture). Such a pricing schedule would severely impact the licensee's margins. Now that LGND has re-acquired rights to Targretin, the licensing deals can be for a larger amount, which could include a immediate up-front payments (which is REVENUE). I assume about your comment that the now in the press release might be a typo was made in jest. <<... the return of Targretin rights will now permit us to rapidly generate revenues from distribution agreements pending in territories in which we will not directly market Targretin in oncology and dermatology,'' said Ligand Chairman, President and CEO David E. Robinson. Rapidly?? WHAT revenues? I also wonder if the "not" is a typo for "now.">>> If not, I'd suggest an Interpretation of Press Release 101 course (with --Tony on AMLN's clinicals): Message 1983270 )

To: Cheryl Galt who wrote (28290)	2/21/1999 12:05:00 PM
From: aknahow	Read Replies (2) \| Respond to of 32384

" ... the return of Targretin rights will now permit us to rapidly generate revenues from distribution agreements pending in territories in which we will not directly market Targretin in oncology and dermatology,'' said Ligand Chairman, President and CEO David E. Robinson. " Robinson has just said LGND has pending agreements to sell Targretin in countries, or geographic zones where it will not be sold by LGND for cancer or dermatology. Since I have no idea of where these areas are, nor what it can be rapidly sold for, if PENDING agreements are finalized, I still do not know how much weight to place on this statement, nor how to value the unknown revenues, from an unknown spot on the map, for an unknown use. But, I understand the statement.<g>

To: Cheryl Galt who wrote (28290)	2/21/1999 1:53:00 PM
From: Machaon	Respond to of 32384

<< ... the return of Targretin rights will now permit us to rapidly generate revenues from distribution agreements pending in territories in which we will not directly market Targretin in oncology and dermatology,'' said Ligand Chairman, President and CEO David E. Robinson. >> Does anyone remember the above statement? <g> Thanks for the response. I enjoy reading your in depth and "easy to understand" analysis of Ligand news. Please keep up your contributions to the thread! The discussion of this press release has been excellent, except for one unnecessary insult criticizing you, and perhaps myself and others, for not being able to understanding the vague press release. But, for me, the exercise was well worth it. Robinson said "rapidly generate revenues". While, unfortunately, he didn't say "rapidly generate significant revenues", we don't have to wait too long to see where the hype ends and the money begins. He said "rapidly generate", not "sometime next century"!<g> Robinson also said "oncology and dermatology". My take is that the Targretin clinical test results in oncology and dermatology are strong. Otherwise, why would he be able to make the statement? But, I have a question. With Targretin's triglyceride side effects, how could it be acceptable for dermatological use? Regards, Bob

To: Cheryl Galt who wrote (28290)	2/21/1999 5:32:00 PM
From: smh	Read Replies (1) \| Respond to of 32384

<< I think the release was vague in some areas, not intentionally, but due to careless language ("diction" imprecise). >> --------------------- << The characterization of the release as "vague" is charitable. Perhaps incomprehensible is a little too strong, but one thing is for sure. There is absolutely no excuse for the lack of clarity in this release. How the company can undermine its own credibility in this way is disturbing to this shareholder >> --------------------- << << The characterization of the release as "vague" is charitable. >> Not in my book. Nothing "charitable" about calling speech "vague." Vague speech mis-communicates, confuses and delays (or wrecks) projects, causes misunderstandings and wars .... >> Cheryl, Were it not for more relevant issues, it would be interesting to discuss the semantics involved above. The bottom line, I believe, is that we share the same low regard for the quality of the subject release. My reading of the release, and resulting questions, were also similar to yours and I thought your interpretive analysis (as usual) was excellent, not withstanding some further enlightenment Henry has subsequently provided. I was taken aback by Henry's responses to your post (I'll have some words for him later). Thought I had missed something, so I went back and reviewed the thread since the release. Looked for answers HN claimed had already been provided and found little. Also looked for some reason for him to respond to you as he did --- nothing (except perhaps my own posts which may have irritated him) Message 7907203 Message 7908154 It would appear that this serious questioning of the Ligand release really hit a nerve with Henry. Regards, SMH