Keryx Biopharmaceuticals (KERX), a NY-headquartered company, possesses a duo of mid/late-phase investigational new drug programs aiming to actualize the commercialization of a cancer-treating and a phosphate-binding drug. Backed by positive phase II efficacy data, FDA’s declaration of the Special Protocol Assessment (SPA), and solid funding, Keryx has the potential to soar in niche markets such as multiple myeloma and hyperphosphatemia. More importantly, the company actively extends its force into acquisition and in-licensing of advanced technologies to supplement its drug development efforts, thereby speeding up progress while trimming down cost before their products reach the pharmacy shelf.
Why multiple myeloma?
The evolution of the pharmaceutical industry over the past decade has resulted in increasing interest in multiple myeloma, a targeted niche market for smaller biotech start-ups whose primary goal is often to attain rapid approvals for orphan drug status through smaller, less-expensive trials. Once this is accomplished, the revenues that accompanied the sales of the approved products will enable companies to pursue more profitable cancer indications. Simply put, concentrating on niche markets such as multiple myeloma assists smaller companies to take baby, yet less-risky, steps towards gaining an entry ticket to the more rewarding and competitive pharmaceutical arena.
That said, multiple myeloma is, not at all, a trivial cancer indication. In fact, it is conceivably one of the most profitable niche tumor indications for novel treatments due to the large amount of drug in demand. The nature of myeloma, being a disseminated cancer, precludes the effectiveness of surgery and radiotherapy, and thus patients require drugs that travel in the blood throughout the body in order to survive. When taken consistently to maintain tumour remission, myeloma drugs allow patients to live for many years, and, for this reason, these drugs supply a wide population of patients that need them to stay alive.
What is multiple myeloma?
Multiple myeloma is a type of blood cancer characterized by the uncontrolled proliferation of B cells, a type of white blood cells responsible for the production of antibodies, constituting an important part of the immune system. The major symptoms of multiple myeloma include bone pain, increased risk of infection, renal failure, and anemia.
Current drugs on the market, although effective at high-dose, suffer from harsh toxicity that poses a limitation. Adding to this, patients ultimately face relapse and experience disease progression when forced to be taken off drugs to avoid fierce side effects. Consequently, drug therapies that offer a low toxicity profile can drastically improve the outcome of the patients by making long term remission possible with continuous dosing.
Why Keryx?
Keryx Biopharmaceuticals is currently testing the efficacy of their novel, potentially first-in-class, oral anti-cancer agent, KRX-0401 (perifosine), in a phase III trial, under the FDA’s Special Protocol Assessment (SPA), against multiple myeloma. With reduced toxicity, KRX-0401 blocks a key cell growth signalling event, the phosphoinositide 3-kinase (PI3K)/Akt pathway, preventing excess cell growth and cell transformation. The agent has demonstrated both safety and clinical efficacy in several tumor types, both as a single agent and in combination with novel therapies. The minimal toxicity and the convenient oral administration route make KRX-0401 suitable as a maintenance therapy post initial remission, warranting large-volume usage by a large patient group.
Outside of multiple myeloma, Keryx is also tapping into the swelling market of end-stage renal disease by developing an oral phosphate-reducing medication, Zerenex (ferric citrate). The drug, indicated for hyperphosphatemia (elevated circulating phosphate levels) in patients with end-stage renal disease, is currently expected to enter phase III trials, pending FDA’s SPA agreement. With dominating drugs, such as Genzyme’s Renagel and Renvela, expiring in 2014, Zerenex could be ripe just in time for the thirsty market.
As a growing company, Keryx also devotes their efforts in actively seeking strategic relationships for its product candidates and hunting down fitting compounds and companies for in-licensing or acquisition, ensuring the company’s competitiveness against other firms.
Summary
All investments in small biotech businesses come with potentially lucrative returns at the expense of immense risks. Keryx has surprised analysts by showing better-than-expected earnings per share (EPS) of ~200% averaged across the past 4 quarters. Currently, the company retains $33.68 million in cash/equivalents plus long-term investment securities, and approximately 56 million shares of common stock outstanding (70 million shares fully diluted) with no debt/convertibles. With a partnership in Japan with JT & Torii Pharmaceuticals, Keryx is expecting over $100 million in potential milestone payments and sales royalties upon the commercialization of Zerenex. Specifically, following the completion of the ongoing phase II study in Japan, the start of the phase III trial will bring in a development milestone payment during 2010.
Based on the promising results obtained thus far with both end-trial investigational new drugs, the debt-free balance sheet, and recommendation by several other analysts covering the company, it is time for strong acquisition of Keryx with anticipation of positive data from the drug trials in 2H11 for KRX-0401 (Perifosine) and 2H10/1H12 for Zerenex.
Sunday, February 14, 2010
Sunday, February 7, 2010
Gilead - source of healing during hurting economy
With 13 products on the market, 4000 employees worldwide, operating in more than 20 locations across the globe, Gilead Sciences (GILD) is well positioned as a dominating player in the HIV/AIDS drug market. The company, ranked #1 by BusinessWeek among the 50 best-performing companies in 2009 (up from #2 in the previous year), discovers easy treatments for patients and delivers outstanding returns for shareholders.
I know Gilead Sciences (GILD) is not a small-cap biotech. However, I can’t help but talk about it after reviewing the company’s recent stunning balance sheet that disclosed eye-catching earnings that will be of interest to many healthcare sector investors out there. Gilead was among the first companies to develop once-a-day tablets for HIV patients, eliminating the need to administer cocktails of medications through intravenous infusions with complex dosing schedules, thereby encouraging exposure and compliance to treatment. Because of this, approximately 8 out of 10 newly diagnosed HIV patients in the US today are initiated on Gilead’s drugs, which usually stay with the patients for years to come.
Less than two weeks ago, Gilead reported positive 4Q earnings with $2.03 billion in revenue, 42% more compared to last year’s figure, yielding $802.2 million in profit, or 87 cents per share, from $560 million, or 59 cents per share, thanks to strong sales of their HIV/AIDS drugs, Atripla, Truvada, and Viread, which grew 50, 19, and 10%, respectively, compared to 4Q2008. The company's announcement exceeded analysts’ expectation of a profit of 85 cents per share and $1.93 billion in revenue according to a Thomson Reuters estimate.
In addition to the HIV/AIDS market, the company also received income from their high blood pressure drug Letairis (44% increase to $52.2 million), and chest pain drug Ranexa ($46 million). Gilead will also be collecting royalty payments for Tamiflu, the first first neuraminidase inhibitor tablet for the treatment and prevention of flu, from Hoffmann-La Roche.
http://www.gilead.com/product_chart
As a whole in 2009, Gilead’s profit grew 33% to $2.64 billion, or $2.82 per share, from $1.98 billion, or $2.06 per share. Revenue rose 31%, to $7.01 billion from $5.34 billion.
In the US alone, 56,300 people were estimated to contract HIV infection in the year of 2006, and at present only about 50% of infected people are being treated. Gilead’s popular medications will continue to provide an easy and uncomplicated way to treat patients in this growing disease pool. Complementary to the core HIV/AIDS drug collection, the company also boasts a wide range of products specific for liver, cardiovascular, respiratory, and eye diseases, and has no shortage of drug candidates in clinical trials (4 in phase III, 8 in phase II, and 5 in phase I). These will ensure that, amid other giants, the company remains in the spotlight - one that investors should not miss.
I know Gilead Sciences (GILD) is not a small-cap biotech. However, I can’t help but talk about it after reviewing the company’s recent stunning balance sheet that disclosed eye-catching earnings that will be of interest to many healthcare sector investors out there. Gilead was among the first companies to develop once-a-day tablets for HIV patients, eliminating the need to administer cocktails of medications through intravenous infusions with complex dosing schedules, thereby encouraging exposure and compliance to treatment. Because of this, approximately 8 out of 10 newly diagnosed HIV patients in the US today are initiated on Gilead’s drugs, which usually stay with the patients for years to come.
Less than two weeks ago, Gilead reported positive 4Q earnings with $2.03 billion in revenue, 42% more compared to last year’s figure, yielding $802.2 million in profit, or 87 cents per share, from $560 million, or 59 cents per share, thanks to strong sales of their HIV/AIDS drugs, Atripla, Truvada, and Viread, which grew 50, 19, and 10%, respectively, compared to 4Q2008. The company's announcement exceeded analysts’ expectation of a profit of 85 cents per share and $1.93 billion in revenue according to a Thomson Reuters estimate.
In addition to the HIV/AIDS market, the company also received income from their high blood pressure drug Letairis (44% increase to $52.2 million), and chest pain drug Ranexa ($46 million). Gilead will also be collecting royalty payments for Tamiflu, the first first neuraminidase inhibitor tablet for the treatment and prevention of flu, from Hoffmann-La Roche.
http://www.gilead.com/product_chartAs a whole in 2009, Gilead’s profit grew 33% to $2.64 billion, or $2.82 per share, from $1.98 billion, or $2.06 per share. Revenue rose 31%, to $7.01 billion from $5.34 billion.
In the US alone, 56,300 people were estimated to contract HIV infection in the year of 2006, and at present only about 50% of infected people are being treated. Gilead’s popular medications will continue to provide an easy and uncomplicated way to treat patients in this growing disease pool. Complementary to the core HIV/AIDS drug collection, the company also boasts a wide range of products specific for liver, cardiovascular, respiratory, and eye diseases, and has no shortage of drug candidates in clinical trials (4 in phase III, 8 in phase II, and 5 in phase I). These will ensure that, amid other giants, the company remains in the spotlight - one that investors should not miss.
Sunday, January 31, 2010
Absorbing Profit through Generex's Magic Oral Formulation
Technology, management, and finance are the big three’s when it comes to seeking the next rising star on the market. Generex Biotechnology Corp. (GNBT), closing at 63 cents a share before the weekend, presents appealing qualities in each of these three areas as a small-cap biotech worth adding to the portfolio.
Currently, Generex is targeting the metabolic disease market with its lead product, Generex Oral-lyn™, an oral insulin spray intended for diabetes treatment. Oral-lyn™ is already approved for sale in India, Algeria, Lebanon and Ecuador, and is in global Phase III clinical trials with over 347 patients being enrolled in 74 clinical sites around the world, including sites in the United States, Canada, Bulgaria, Poland, Romania, Russia and Ukraine. In addition, with the remarkable efforts of Generex's regulatory team, the oral insulin, demonstrating the potential of efficacy through clinical testing without unreasonable risks, recently (September, 2009) became the only developmental drug intended to treat diabetes to receive the FDA's approval under the Treatment Investigational New Drug program. This successfully positions Oral-lyn™ as an extremely favourable product candidate for near future FDA approval of the drug’s marketing in the US. According to a close physician friend specializing in diabetes patient care, “the compact size [of Generex’s insulin delivery device] and avoidance of [insulin] lung deposit are no doubt advantages [for more convenient and safer glucose management]”. Importantly, these will help prevent the oral insulin from following the footsteps of Pfizer's failed inhaled insulin product, Exubera, criticized for its bulky appearance and carcinogenic risks to the lungs.
As another arm of operation, Generex’s wholly owned subsidiary, Antigen Express, Inc. focuses on developing proprietary vaccine formulations that work by stimulating the immune system to either attack offending agents (i.e., cancer cells, bacteria, and viruses) or to stop attacking benign elements (i.e., self proteins and allergens). Products already in mid-stage development include Antigen’s synthetic peptide vaccines designed to stimulate a potent and specific immune response against tumors expressing the HER-2/neu oncogene for patients with HER-2/neu positive breast cancer (potential application in personalized medicine) in a Phase II clinical trial and patients with prostate cancer and against avian influenza in two Phase I trials. Further research programs also encompass areas in seasonal influenza virus, H5N1, HIV, HPV, melanoma, ovarian cancer, allergy and Type I diabetes mellitus.
In addition to his contribution in founding Amgen, Dr. Rubinfeld has a fifty year history in pharmaceutical and consumer product development, including the development of the multi-billion dollar antibiotic Amoxicillin as well as the invention and development of the first synthetic biodegradable detergent. In 1984, Dr. Rubinfeld won the prestigious Common Wealth Award for Science and Invention, recognition of his determination in achieving major inventions, represented by the numerous patents obtained during his distinguished career. Dr. Rubinfeld co-founded the IBA (Industrial Biotechnology Association) in 1981, which was the precursor to today's BIO (Biotechnology Industry Organization). He has also served as an advisor or board member to a number of biotech companies including AVI BioPharma, Quark Pharmaceuticals, and Cytrx Corporation. In 1991, he founded Supergen, a drug development company based in Dublin, California, where he served as Chairman, CEO and President until 2003 and as a member of the board of directors until 2005.
Dr. Rubinfeld will assist Generex in developing and implementing product commercialization strategies for its proprietary drug delivery platform and its synthetic vaccine platform technology programs.
"Generex is at a very pivotal position in its history, as the Company transitions from a pure research and development organization to the commercialization of its drug delivery platform and significant sales growth. After a substantial review of the Company's intellectual property, I am convinced that what is unique to Generex is that its delivery method can be applied to a host of drugs already on the market. Its Generex Oral-lyn™ diabetes product just scratches the surface of the potential benefits for patients, by providing a simple pain-free alternative to injectable drugs or other difficult drug delivery systems. Partnership opportunities for improved delivery of such drugs could significantly benefit patients and also extend the longevity of intellectual property protection, which is critical for pharmaceutical company revenues." says Dr. Rubinfeld when asked about the prospect of Generex. He further states, "I am equally intrigued with the synthetic vaccine technologies in development at the Antigen Express subsidiary. The cancer vaccines are showing promising results in initial human testing. Also, with the global concerns of the current flu pandemic, I believe there will also be partnering opportunities. The technology, which can reduce the time to get new vaccines available to the public, is a very attractive proposition. I am excited to assist in all of these areas. I feel rejuvenated to apply my knowledge to a company with such a vast potential."
With the joining of Dr. Rubinfeld along with his belief in Generex’s technologies, wealth of experience in early stage biotechnology development, and exceptional track record in large pharmaceutical companies, Generex is optimistic that they will achieve goals of becoming a rapid-growing, well-rounded, and profitable drug company of the future.
I am long Generex and am anticipating painless absorption of profits from this company.
Technology
The key technology that the development stage company focuses on is a platform pharmaceutical formulation that enhances drug uptake through the inner lining of the mouth. This is accomplished through a special compact inhaler that contains proprietarily formulated drug in aqueous solution, which is delivered in droplets at an optimal angle to maximize the impact with the buccal mucosa (mucous membrane of the inside of the cheek). The size of the droplets is created by a uniquely designed mechanical device specifically for oral (NOT lung) drug absorption. The combination of these features offers a simple and convenient way for patients to take accurate and reliable amounts of medications. Furthermore, the buccal absorption route, having access to a large bed of blood vessels, allows drugs to enter the circulation of the body rapidly, effectively, and without pain, an advantage especially desirable for patients (a lot of them kids) who face the discomfort and fear behind multiple daily injections of medicines such as insulin. Non-invasive therapies lead to improved patient compliance and therefore positively reduce the dollars (estimated $8.5B in the US alone) associated with noncompliance.Currently, Generex is targeting the metabolic disease market with its lead product, Generex Oral-lyn™, an oral insulin spray intended for diabetes treatment. Oral-lyn™ is already approved for sale in India, Algeria, Lebanon and Ecuador, and is in global Phase III clinical trials with over 347 patients being enrolled in 74 clinical sites around the world, including sites in the United States, Canada, Bulgaria, Poland, Romania, Russia and Ukraine. In addition, with the remarkable efforts of Generex's regulatory team, the oral insulin, demonstrating the potential of efficacy through clinical testing without unreasonable risks, recently (September, 2009) became the only developmental drug intended to treat diabetes to receive the FDA's approval under the Treatment Investigational New Drug program. This successfully positions Oral-lyn™ as an extremely favourable product candidate for near future FDA approval of the drug’s marketing in the US. According to a close physician friend specializing in diabetes patient care, “the compact size [of Generex’s insulin delivery device] and avoidance of [insulin] lung deposit are no doubt advantages [for more convenient and safer glucose management]”. Importantly, these will help prevent the oral insulin from following the footsteps of Pfizer's failed inhaled insulin product, Exubera, criticized for its bulky appearance and carcinogenic risks to the lungs.
As another arm of operation, Generex’s wholly owned subsidiary, Antigen Express, Inc. focuses on developing proprietary vaccine formulations that work by stimulating the immune system to either attack offending agents (i.e., cancer cells, bacteria, and viruses) or to stop attacking benign elements (i.e., self proteins and allergens). Products already in mid-stage development include Antigen’s synthetic peptide vaccines designed to stimulate a potent and specific immune response against tumors expressing the HER-2/neu oncogene for patients with HER-2/neu positive breast cancer (potential application in personalized medicine) in a Phase II clinical trial and patients with prostate cancer and against avian influenza in two Phase I trials. Further research programs also encompass areas in seasonal influenza virus, H5N1, HIV, HPV, melanoma, ovarian cancer, allergy and Type I diabetes mellitus.
Management
Worthy of note within Generex’s management is the newly addition of Dr. Joseph Rubinfeld, one of the original founders of Amgen Inc. (world’s largest independent biotech firm) as the company's Chief Scientific Advisor.In addition to his contribution in founding Amgen, Dr. Rubinfeld has a fifty year history in pharmaceutical and consumer product development, including the development of the multi-billion dollar antibiotic Amoxicillin as well as the invention and development of the first synthetic biodegradable detergent. In 1984, Dr. Rubinfeld won the prestigious Common Wealth Award for Science and Invention, recognition of his determination in achieving major inventions, represented by the numerous patents obtained during his distinguished career. Dr. Rubinfeld co-founded the IBA (Industrial Biotechnology Association) in 1981, which was the precursor to today's BIO (Biotechnology Industry Organization). He has also served as an advisor or board member to a number of biotech companies including AVI BioPharma, Quark Pharmaceuticals, and Cytrx Corporation. In 1991, he founded Supergen, a drug development company based in Dublin, California, where he served as Chairman, CEO and President until 2003 and as a member of the board of directors until 2005.
Dr. Rubinfeld will assist Generex in developing and implementing product commercialization strategies for its proprietary drug delivery platform and its synthetic vaccine platform technology programs.
"Generex is at a very pivotal position in its history, as the Company transitions from a pure research and development organization to the commercialization of its drug delivery platform and significant sales growth. After a substantial review of the Company's intellectual property, I am convinced that what is unique to Generex is that its delivery method can be applied to a host of drugs already on the market. Its Generex Oral-lyn™ diabetes product just scratches the surface of the potential benefits for patients, by providing a simple pain-free alternative to injectable drugs or other difficult drug delivery systems. Partnership opportunities for improved delivery of such drugs could significantly benefit patients and also extend the longevity of intellectual property protection, which is critical for pharmaceutical company revenues." says Dr. Rubinfeld when asked about the prospect of Generex. He further states, "I am equally intrigued with the synthetic vaccine technologies in development at the Antigen Express subsidiary. The cancer vaccines are showing promising results in initial human testing. Also, with the global concerns of the current flu pandemic, I believe there will also be partnering opportunities. The technology, which can reduce the time to get new vaccines available to the public, is a very attractive proposition. I am excited to assist in all of these areas. I feel rejuvenated to apply my knowledge to a company with such a vast potential."
With the joining of Dr. Rubinfeld along with his belief in Generex’s technologies, wealth of experience in early stage biotechnology development, and exceptional track record in large pharmaceutical companies, Generex is optimistic that they will achieve goals of becoming a rapid-growing, well-rounded, and profitable drug company of the future.
Finance
Data provided by Capital IQ, as of Jan. 31, 2010
Summary
Although it may not be apparent from the current financial numbers due to premature product marketing, Generex is prepared to surface to the top with the Company's flexible and well-protected technologies that allow drugs to be absorbed through the inner lining of the mouth as an alternative to needle injection, ongoing cancer/flu vaccine programs, extensively experienced leaders, and upward-trending estimated income. All of these substantially appreciate the value of the company, making it an attractive subject for acquisition, partnership, and immense growth.
Data provided by Capital IQ, as of Jan. 31, 2010
Summary
I am long Generex and am anticipating painless absorption of profits from this company.
Wednesday, January 20, 2010
2010 Pharmaceutical/Biotech Industry Forecast
For those who are looking into investing in the biopharmaceutical industry, 2010 will be a flourishing year for you. A great number of mergers and acquisitions are to be expected as waves of consolidation linger from last year's major restructuring (e.g. Pfizer-Wyeth, Merck-Schering Plough, Roche-Genentech). Big pharma, such as Genzyme, will have to rely on the innovation and agility of small biotech to replenish the product pipeline as profit-generating pills run out of patent protection. Pay extra attention to small biotech companies that can help large pharmaceutical corporations to not only expand their drug portfolio but also establish new grounds in emerging market (did I hear SMALL and INNOVATIVE?!?!). Set your screening parameters to include only those that are coming out of phase II and/or entering phase III trials to maximize your gain. Included in your filter should also be the lead technology being developed by the company. Given the leap in genomic science, companies with technologies associated with personalized medicine and its accompanying diagnostics will likely stand out from the crowd. Of course, don't forget the overarching impact that ObamaCare will create and how it will alter the landscape of pharmaceutical business (topic of further discussion later).
In summary, the healthcare sector will see strong growth in 2010 with the injection of fresh financings into pharmaceutical R & D and commercialization, and in the midst of deal-signing and handshaking, smaller-cap biotech stocks are personally favoured. Keep in mind: Identifying and investing in ripening technologies irrigated by streaming capital will warrant you to be a big winner at the start of this new decade!
In summary, the healthcare sector will see strong growth in 2010 with the injection of fresh financings into pharmaceutical R & D and commercialization, and in the midst of deal-signing and handshaking, smaller-cap biotech stocks are personally favoured. Keep in mind: Identifying and investing in ripening technologies irrigated by streaming capital will warrant you to be a big winner at the start of this new decade!
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