Columbia Laboratories (CBRX) - Novel Drug Delivery Offers Lower Risks of Preterm Birth and Improved Infant Outcomes

Summary 

• Company - Columbia Laboratories (CBRX)
• Drug candidate - PROCHIEVE® (progesterone gel)
• FDA Panel - 2012/01/20
• PDUFA - 2012/02/26

Preterm Birth in Women with Premature Cervical Shortening

Columbia's lead clinical development program is PROCHIEVE® (progesterone gel) to reduce the risk of preterm birth in women with premature cervical shortening. Preterm birth is a serious public health problem, affecting 10 to 12% of all pregnancies in the United States. The ecomomic impact of preterm birth is significant, costing more than $26 billion annually, with the average preterm infant costing approximately $52,000. A short cervical length at mid-pregnancy is the single most powerful predictor of preterm birth.

Technology

Key Ingredient

Each of Columbia’s marketed products and product candidates utilizes its bioadhesive drug delivery system (BDS) technology that differentiates Columbia from its competitors and provides a platform for numerous future applications. The key ingredient in the BDS is polycarbophil, a non-immunogenic, hypo-allergenic, bioadhesive polymer. Polycarbophil bonds to the cells of the body’s mucosal surfaces upon administration. In Columbia's vaginally-administered products, it bonds to the vaginal epithelial cells. Once in place, the BDS releases the active drug in a controlled and sustained manner until it is discharged 
upon normal cell turnover. This occurs every three to five days for the vaginal epithelium.

Formulation

Gels —The Company’s bioadhesive vaginal gels are self-administered using a patient-
friendly, pre-filled applicator. 

Chemistry

Polycarbophil is lightly cross-linked with divinyl glycol. It is a weak polyacrylic acid (pKa = 4.2) containing multiple carboxyl radicals (COO-), which are the source of its negative charges. These acid radicals permit hydrogen bonding with the cell surface. Hydrogen bonds are weak, but in the case of polycarbophil they are numerous and therefore tenacious.

Polycarbophil mimics negatively charged mucin, the glycoprotein component of mucus responsible for its attachment to underlying epithelial surfaces.

Benefits
Bioadhesive vaginal delivery of progesterone exhibits the following benefits:

• Facilitates targeted delivery of active compounds to the uterus, right where they are needed
• Avoids the local site pain, irritation and potential infection of daily compounded progesterone intramuscular injections
• Maintains low systemic levels

Pre-filled applicators make these FDA-approved products easy to use and patient-friendly, without the mess of pharmacy-compounded suppositories.

Columbia’s technology is currently being used to develop bioadhesive, vaginally-administered anesthetic, testosterone, and carbamide peroxide products to treat a variety of women’s healthcare indications.

Summary of Clinical Data

In April 2007, Columbia reported that data from a Phase III clinical trial that evaluated PROCHIEVE for the prevention of preterm birth in women with a prior preterm birth earlier than 35 weeks show a delay in cervical shortening in patients treated with PROCHIEVE versus placebo. The data further suggest a correlation between cervical length, progesterone administration, and both a reduction in the likelihood of preterm birth and an improvement in infant outcomes. The data were published in the peer-reviewed journal Ultrasound in Obstetrics & Gynecology in October 2007.

In 2008, Columbia initiated the PREGNANT (PROCHIEVE Extending GestatioN A New Therapy) study, a randomized, double-blind, placebo-controlled Phase III clinical trial evaluating PROCHIEVE to reduce the risk of preterm birth in women with a short cervical length as measured by transvaginal ultrasound at mid-pregnancy. In October 2008, Columbia announced a collaboration with the Perinatology Research Branch (PRB) of the Division of Intramural Research of the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD) of the National Institutes of Health (NIH), under which we amended the study protocol to reflect the addition of nine NIH sponsored sites and an increase in the number of patients from 300 to 450.

In December 2010, Columbia and Watson jointly reported positive top-line PREGNANT study results; the study was published in Ultrasound in Obstetrics & Gynecology in July 2011. The published results indicate that administration of PROCHIEVE from mid-pregnancy until term in women with a premature cervical shortening as confirmed by transvaginal ultrasound was associated with a statistically significant reduction in the rate of preterm birth at ≤32 6/7 weeks (p=0.020), the primary endpoint of the study, vs. placebo gel. Use of PROCHIEVE was associated with a 45% reduction in the incidence of preterm birth at this endpoint. Improvement in infant outcome was noted with PROCHIEVE. The incidence and profile of adverse events in patients receiving PROCHIEVE was comparable to placebo, which was as expected given the product's documented safety history. 

Source: Columbia Laboratories 

Trading map

For those unfamiliar with the hike-n-slide trading strategy, my primary strategy to trade biotech stocks, it takes advantage of the increased volatility and hyped up anticipation of a pre-scheduled event (i.e., FDA panel, clinical results release, PDUFA). Trades are made before and after the announcement of the event outcome without having to hold unjustifiable risks through the event. As such, the actual outcome of the event (i.e., positive or negative recommendation, approval or rejection) will not significantly affect the profitability of the trades - the beauty of the hike-n-slide trading strategy.

CBRX has climbed more than 15% in the past month ahead of the 1/20 FDA panel as traders broadly anticipate positive recommendations from the panelists. At $2.50, CBRX is still 72.4% lower than its 52-wk high of $4.31, which was seen after a hike in share price that initiated after the company announced positive phase III clinical trial data in Dec of 2010. As the FDA panel date approaches, CBRX is expected to hike back towards this level as trading activity picks up. A great way to trade CBRX is through call options. As of the last trading session of 2011, CBRX Jan 2.5 call was trading at $.30, meaning that the options would be in the money when CBRX trades at $2.8 ($2.5 + $.30). If the global economy remains steady, it is very likely that CBRX will be trading above $2.8 before 1/20. However, the only concern is that Jan call options expire on 1/21, a day after the panel meeting takes place on the Friday before the option expiration (OpEx) weekend. In other words, traders may not have a chance to know the results of panel votes before the options stop trading at the end of Friday's trading. This may encourage more buying of the Feb call options which of course carry a higher time premium. It is ultimately up to the individuals to decide which of the Jan or the Feb call options to go with for trading CBRX. So far, higher volume has been observed with the Jan call options compared to the Feb call options. I will make my call (no pun intended) fairly soon. Follow me on Twitter (@Michaeljuan01) for trading updates.  Good luck!  

  

Looking ahead - Make sure you know what's cooking in biotech in 1H2012!

In order to take advantage of biotech stock/options trading, it is paramount to know which companies are the centre of attention within the biotech community. These companies tend to be the ones facing scrutiny by the FDA panel and those to be dealt FDA drug approval decision (PDUFA). With skyrocketing volatility, the stocks of these companies are perfect for trading. Mark these important dates down on your calendar as a start. Detailed analysis of each company and trading roadmap will follow as the date of each event approaches. Good luck and have a fulfilling and prosperous 2012!

Watchlist 2011-10-30

A few biotech stocks (with near term catalysts) that I will be watching:

Vivus Inc. (VVUS) - one of the most-watched biotech companies late last year with an obesity drug candidate, QNEXA, whose approval was DENIED by the FDA on 2010-10-29 based on birth defect and cardiovascular concerns.  We are expecting to hear FDA's acceptance of QNEXA's NDA resubmission (likey by tomorrow 2011-10-31).  A PDUFA action date will be assigned when this occurs and we may see a quick hike-n-slide play.

Pacira Pharmaceuticals (PCRX) - PCRX is expected to deliver a press release Monday morning to disclose the outcome of FDA's decision on EXPAREL, which had an PDUDA date of 2011-10-28 (last Friday).  It is widely speculated, based on rumors, that FDA has approved the drug.  We will see lots of trading actions tomorrow morning.  Unfortunately, no PCRX options are available for trading, making it less attractive for a slide play.

BioSante Pharmaceuticals (BPAX) - though the original November PDUFA date for Company's Bio-T-Gel  has been delayed to 2012-02-14, investors' appetites for this stock have not decreased.  In fact, BPAX hiked up 17% last week as more investors turned their attentions to the results of Libigel's pivotal trial data, to be announced some time in December.  Should the markets remain strong, another great week for BPAX should follow!

pSivida Corp. (PSDV) - PSDV has a PDUFA date next week (2011-11-12) for ILUVIEN.  Stock popped 12% on Friday.  Based on the high call/put option ratio, most investors are betting on ILUVIEN's approval.  This is an interesting stock to follow.

Staying active while seeking opportunities in Biotech

If you haven't noticed, I have posted significantly fewer number of articles since August (2011).  Why?!  Well (besides my newly arrived baby boy), plainly put, the landscape of biotech trading has changed drastically.  Many companies that people thought were great 'Hike' targets based on major catalyst events (PDUFA, clinical trial results, NDA filing/acceptance) never saw the 'Hike' that was highly anticipated and once foreseeable.  Correspondingly, the magnitude and predictability of 'Slide' have also been diminished.  As a result, it take a lot more patience and discipline to execute trades following what was once 'predictable' patterns.  Undoubtedly, it has been tough and head-scratching for many biotech enthusiasts for the past several months, but, moving forward, people should continue to remind themselves of the following principles which will, in my mind, sustain the viability and profitability of biotech stocks and options trading:


1) Biotech will ALWAYS thrive - big pharmas simply lack the focus, energy, and agility that small biotech companies possess to develop new therapies and innovative medical devices; licensing and acquisition by big pharma will still be the key theme in the coming years


2) Big news events in biotech will ALWAYS drive hype - major news networks, trading forums, and even social media (such as Twitter) continue to be valuable sources of information/misinformation that help stimulate the excitement about a particular event (e.g., drug approval), which in turn leads to volatile stock prices that traders can take advantage of

3) Biotech stocks/options will ALWAYS yield high percentage profit - I know this one is tricky and may not be as convincing in a tough market, but when the economy stabilizes, small cap biotech will be one of the first places where traders will pour their money back into.  Particularly with stock options, high percentage profit in a short time can easily be achieved (I remember when 100+% gains in a matter minutes were the norm just before the summer of this year).   


All in all, I will continue to seek opportunities in biotech and share them with you here.  However, I will be using Twitter as my primary trading news tool on a day-to-day basis.  There is a Twitter Feed column to the right of this blog where you can view my most recent tweets.  Note that I will also stay an active trader even when I don't see any good trades in biotech - I do this by trading broad market indices and a few tech companies.  Follow me on Twitter (@MichaelJuan01) for more trading updates.  As usual, good luck to you all!

BioSante Pharmaceuticals (BPAX) - Tapping into a billion dollar niche with female viagra

Company:  BioSante Pharmaceuticals (BPAX)

Product candidates:  LibiGel, Bio-T-Gel
Short term catalyst:  3 presentations at healthcare conferences (9/7, 9/12, 9/27); press release
Mid-term catalyst:  Bio-T-Gel PDUFA (11/14), LibiGel Phase III efficacy trial results update (4Q2011)
Long term catalyst:  LibiGel NDA filing (mid/end-2012)
52-week high:  $4.02
52-week low:  $1.30

TheStreet.com Interview with BioSante CEO


Cash Position
On Aug. 2, 2011, BPAX closed a $48 million public offering of common stock.  According to BPAX CEO, Stephen Simes, the proceeds of the $48 million underwritten financing together with the cash the company had before the transaction results in almost $80 million in cash.  This cash balance is sufficient to fund the LibiGel program and BioSante through the anticipated LibiGel new drug application (NDA) submission by the end of 2012, and in fact all the way through a potential FDA approval which could come in mid-2013.  This long runway was one of the key reasons for executing the transaction at this time.  Another reason for executing the transaction at that time was so that in the fourth quarter of this year when the company announce LibiGel efficacy data investors can concentrate on the quality of the data versus being concerned that BPAX would need to raise money.

More on LibiGel Trials
LibiGel (testosterone gel) is being developed for the treatment of female sexual dysfunction (FSD), hypoactive sexual desire (HSDD) in post-menopausal women.  BPAX has completed enrollment in two pivotal efficacy trials under SPA agreements with results expected during the fourth quarter of 2011.  In addition, the company has also completed enrollment  in a Phase III safety trial, which is expected to produce data supporting LibiGel's NDA submission anticipated to be made in 2012..

Primary safety outcomes being evaluated are related to cardiovascular (CV) events such as CV death, myocardial infarction, and stroke with a lower than expected rate of 0.58% (22 CV events) observed to date and a 0.24% rate of breast cancer (nine cases).  BPAX has patent protection for LibiGel through mid-2022 and estimates over 4 million testosterone prescriptions are written off-label for the treatment of female sexual dysfunction (FSD), representing a potential market opportunity of $2 billion.

Summary of the background and rationale for development of LibiGel for the treatment of FSD, HSDD in post-menopausal women (based on BPAX's recent SEC 10-K Annual Report filing)
“Although generally thought of as being limited to men, testosterone also is important to women and its deficiency has been found to cause low libido or sex drive.  Studies have shown that testosterone therapy in women can boost sexual desire, sexual activity and pleasure, increase bone density, raise energy levels and improve mood.

According to a study published in the Journal of the American Medical Association (JAMA), 43% of American women between the ages of 18 to 59, or about 40 million women, experience some degree of impaired sexual function. Among the more than 1,400 women surveyed, 32% lacked interest in sex (low sexual desire).  Furthermore, according to a study published in the New England Journal of Medicine (NEJM), 43% of American women between the ages of 57 to 85 experience low sexual desire.

According to IMS data, two million testosterone prescriptions were written off-label for women by U.S. physicians in 2009 and according to independent primary market research, at least 2 million additional prescriptions of compounded testosterone were written off-label for women. Female sexual dysfunction is defined as a lack of sexual desire, arousal or pleasure. The majority of women with FSD are postmenopausal, experiencing symptoms due to hormonal changes that occur with aging or following surgical menopause.”

Trading Roadmap
Given the list of catalysts in the short, mid-, and long term (including PDUFA, clinical trail results, NDA filing), there is great potential that BPAX will see a 'Hike' ahead of the company's anticipated submission in 2Q2012.  Under normal circumstances, it would be safe and less risky to purchase call option contracts with an expiry date many months down the road.  However, with the increased volatility and unpredictability seen in the markets around the world at the moment, I would remain cautious in making such 'long term' trades with catalysts that are as far as 3 months away.  Currently, Dec 2.5 call options are traded at $.75.  With BPAX trading in the $3.60 -3.80 range just prior to the latest round of stock offer, this is a reasonable entry to me.  The 3 presentations by BPAX in September could potentially attract more investor attention and kick off the 'Hike'.  I will continue to monitor BPAX price in the coming weeks.  Good luck!  You are always welcome to follow me on Twitter (@MichaelJuan01) for trading updates.

About BioSante
About LibiGel
About Bio-T-Gel

UPDATE: Seattle Genetics' (SGEN) ADCETRIS receives accelerated approval for two indications

Friday's early approval announcement may have caught many by surprise (original PDUFA 8/30); hence the irregular price fluctuation at close. With the Aug options expiring today (technically tomorrow), there was not really any opportunity for a 'Slide' play. The Sept put options still carry a high time premium at this point, so I will look into these early next week (potentially another spike Monday morning) and decide what to do.  Since the approval was only the accelerated type and not the full version, SGEN will have to conduct a phase IV/confirmatory trial post marketing.  This was NOT what investors would have liked to hear, so a 'Slide' is quite likely.  I will keep an eye out for this next week! 

Recent market turmoil and the upcoming week (8/8 - 8/12)

What's happening?

We all know that job numbers aren't increasing as fast as they should, economic growth is overwhelmingly sluggish, and the stock market has just suffered its worst week since the recession.  Those of us, biotech investors, have seen once consistently profiting strategies being thrown out the window in these past two weeks.  Take a look at the incredible change in some of the highly 'promising' biotech stocks during 7/25 - 8/5 (2-wk period):

$CLSN: down 25.42%

$ANX: down 28.07%

$SGEN: down 22.72%

$BPAX: down 33.8%

$DEPO: down 32.2% 

Fueling the fire, S&P downgraded the US credit from the top AAA rating for the first in history on Friday (8/5). Middle East stock markets first reacted to this with a dramatic plunge in late Sunday morning (8/7), and it is said that the Asian markets will follow suit later in the day.  How will the US stock market react tomorrow morning?  Will another 500+ point drop occur?  Will the Fed intervene?  Is QE3 in place?  Have we reached the bottom yet (Alan Greenspan doesn't think so)?  Those are obvious questions that every investor thinks about as he/she rehearses the various scenarios of market reaction in this upcoming week.

What would I do?

While the latest financial news (i.e. S&P downgrade) could have huge impact on the market's already weakened confidence, I don't see this as the end of the world (yet) for a few reasons: 

1) S&P is not the only ratings agency (Moody's and Fitch still maintain US credit at AAA)

2) US treasuries are still among the safest investment instruments in relative terms despite downgrade 

3) Washington going to great lengths to discredit S&P in hopes to minimize downgrade impact

I foresee a broad sell-off as the market opens tomorrow, followed by stabilization, if not even a rally.  I've read/heard that many are gearing up to put their cash to work and I certainly agree that many stocks with near term catalysts, such as ones mentioned above, are heavily discounted right now.  Nevertheless, I will remain cautious before resuming full on buying mode (there are still many other factors, such as employment, political weakness, Euro debt, economic growth...etc. that add to instability).  I will do so only when I see at least 2-3 consecutive days of gains plus reversal of broad market sentiment; otherwise cash is still a valuable position!  As always, think wisely, evaluate cautiously, and act boldly - good luck! 

Reminder of near term catalysts:

$SGEN - PDUFA 8/30

$ANX - PDUFA 9/1

$CLSN - Phase III results in last Sept/Oct

$DEPO - Phase III results in Oct

$BPAX - PDUFA 11/14