Five Drug Makers with Pending Catalysts 46 comments
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This is the first article of a new series covering select drug, device and diagnostic makers. Listed below are five select drug makers with significant events (catalysts) scheduled in the days and weeks ahead (dates indicated). Outcomes from these events could produce a significant move - one way or the other - in any of underlying companies' shares. Odds of success (%) are derived from actual historical outcomes of previously successful drugs and companies that were similarly situated to those identified below.
When investing in a high risk environment, investors should consider hedging all of their long positions, calls and common shares, with put options.
SEPTEMBER 2
Endo Pharmaceuticals (ENDP)
When the folks at ENDP acquired Indevus Pharmaceuticals on March 23, 2009, they picked up a couple of potential best-in-class drugs. One of those drugs is testosterone undecanote (formerly Nebido®), which is indicated for male hypogonadism or low testosterone. Regulators are scheduled to decide on the Nebido resubmission on September 2. For the record, I was long Indevus at the time of ENDP’s offer and I was fortunate to walk away with very nice gain on January 6.
Nebido is administered by injection, but ONLY five times in a given year, compared to other injection treatments requiring patients get stuck every 2 to 4 weeks or so. As the hypogonadism patient pool grows in the coming years, Nebido is an attractive solution with tremendous potential.
Odds of a successful outcome: 74%
Questcor Pharmaceuticals (QCOR)
At this time last year, a close friend, who works as a financial advisor with Raymond James in Indiana, turned me on to QCOR. The company currently markets H.P. Acthar® Gel (Acthar) for nephrotic syndrome and now seeks regulatory approval for infantile spasms. Regarding the latter, regulators are scheduled to decide the fate for Acthar’s supplemental New Drug Application (sNDA) on September 2.
When investing in a high risk environment, investors should consider hedging all of their long positions, calls and common shares, with put options.
SEPTEMBER 2
Endo Pharmaceuticals (ENDP)
When the folks at ENDP acquired Indevus Pharmaceuticals on March 23, 2009, they picked up a couple of potential best-in-class drugs. One of those drugs is testosterone undecanote (formerly Nebido®), which is indicated for male hypogonadism or low testosterone. Regulators are scheduled to decide on the Nebido resubmission on September 2. For the record, I was long Indevus at the time of ENDP’s offer and I was fortunate to walk away with very nice gain on January 6.
Nebido is administered by injection, but ONLY five times in a given year, compared to other injection treatments requiring patients get stuck every 2 to 4 weeks or so. As the hypogonadism patient pool grows in the coming years, Nebido is an attractive solution with tremendous potential.
Odds of a successful outcome: 74%
Questcor Pharmaceuticals (QCOR)
At this time last year, a close friend, who works as a financial advisor with Raymond James in Indiana, turned me on to QCOR. The company currently markets H.P. Acthar® Gel (Acthar) for nephrotic syndrome and now seeks regulatory approval for infantile spasms. Regarding the latter, regulators are scheduled to decide the fate for Acthar’s supplemental New Drug Application (sNDA) on September 2.
Acthar is currently indicated to treat Nephrotic Syndrome (specifically 'to induce a diuresis or a remission of proteinuria in the Nephrotic Syndrome without uremia of the idiopathic type or that due to lupus erythamatosus'). We are working with leading nephrologists to further study the use of Acthar in the treatment of nephrotic syndrome.
We have also completed filing a supplemental New Drug Application (sNDA) for Acthar as a treatment for Infantile Spasms. There is currently no drug approved in the United States for the treatment of Infantile Spasms. Source: Questcor Pharmaceuticals
As I indicated in this recent article at BioMedReports, I’ve reviewed the data and still can’t seem to get my arms around the optimism that surrounds ALTH and its cancer drug pralatrexate (PTX). With that said, anything can and does happen in this industry. The Oncology Drug Advisory Committee is expected to review PTX on September 2, and make a recommendation to the FDA on whether they should approve it. On September 24, the FDA is scheduled to hand down their decision on PTX.
PTX is indicated for a rare form of non-Hodgkin’s lymphoma (NHL) called peripheral t-cell lymphoma (PTCL). Due to the low incidence of PTCL, PTX received orphan drug status. Therefore, additional marketing privileges will be available to PTX upon approval. ALTH also obtained a fast track designation for PTX from the FDA. Under the fast track designation, PTX could be approved early. To the best of my knowledge, PTX has only completed a single Phase 2 trial. Surprisingly, ALTH has not yet found a partner to help them market PTX.
Odds of a successful outcome: 47%
LABOR DAY, SEPTEMBER 7
Spectrum Pharmaceuticals (SPPI)
Odds of a successful outcome: 47%
LABOR DAY, SEPTEMBER 7
Spectrum Pharmaceuticals (SPPI)
On or before Labor Day, September 7 (next Monday), the FDA is scheduled to review SPPI’s supplemental application for Zevalin. Zevalin is already approved in the US for refractory non-Hodgkin’s lymphoma (NHL). SPPI hopes to get Zevalin approved as a first-line consolidation therapy for the treatment of NHL. For more details on Zevalin, refer to this August 20 article.
On Monday, August 31, SPPI closed at a fresh multi-year high of $8.50.
Odds of a successful outcome: 85%
SEPTEMBER 30
Ariad Pharmaceuticals (ARIA)
The folks at ARIA are scheduled to release the first interim analysis from a Phase 3 study of their cancer drug ridaforolimus (rida) on or before September 30. Rida is indicated for rare soft tissue and bone sarcomas. The company expects to provide the results from a second interim analysis in Q1 2010 or no later than March 31, 2010. With positive results from the second interim analysis, the company will file an NDA requesting early approval for the drug. If granted priority review from regulators, then rida could be approved as early as Q4 2010.
Like ALTH’s drug PTX, ARIA’s rida is also an orphan drug. Unlike ALTH, however, ARIA has a collaboration agreement with Merck (MRK), which is valued at or near $1 billion. For more details on ARIA, please refer to this August 14 article.
Odds of a successful outcome: 70%
OCTOBER 8
Spectrum Pharmaceuticals (SPPI)
SPPI has yet another drug that will be reviewed by the FDA, Fusilev®, on October 8. Here, SPPI is seeking to get Fusilev approved for use in combination with 5FU for the treatment of colorectal cancer. Fusilev is already approved in the US for combination treatment of osteosarcoma.
It should be noted that it is very rare for a small cap drug maker to have two drugs reviewed in one year. From my research, I could not find another drug maker who had previously received approval for two cancer drugs in the same year. SPPI is very rare case and is worth paying some attention. For more details on Fusilev, check out this June 19 article.
Odds of successful outcome: 85%
On Monday, August 31, SPPI closed at a fresh multi-year high of $8.50.
Odds of a successful outcome: 85%
SEPTEMBER 30
Ariad Pharmaceuticals (ARIA)
The folks at ARIA are scheduled to release the first interim analysis from a Phase 3 study of their cancer drug ridaforolimus (rida) on or before September 30. Rida is indicated for rare soft tissue and bone sarcomas. The company expects to provide the results from a second interim analysis in Q1 2010 or no later than March 31, 2010. With positive results from the second interim analysis, the company will file an NDA requesting early approval for the drug. If granted priority review from regulators, then rida could be approved as early as Q4 2010.
Like ALTH’s drug PTX, ARIA’s rida is also an orphan drug. Unlike ALTH, however, ARIA has a collaboration agreement with Merck (MRK), which is valued at or near $1 billion. For more details on ARIA, please refer to this August 14 article.
Odds of a successful outcome: 70%
OCTOBER 8
Spectrum Pharmaceuticals (SPPI)
SPPI has yet another drug that will be reviewed by the FDA, Fusilev®, on October 8. Here, SPPI is seeking to get Fusilev approved for use in combination with 5FU for the treatment of colorectal cancer. Fusilev is already approved in the US for combination treatment of osteosarcoma.
It should be noted that it is very rare for a small cap drug maker to have two drugs reviewed in one year. From my research, I could not find another drug maker who had previously received approval for two cancer drugs in the same year. SPPI is very rare case and is worth paying some attention. For more details on Fusilev, check out this June 19 article.
Odds of successful outcome: 85%
Date | Symbol | Odds of Success |
|---|---|---|
Sept 2 | ENDP | 74% |
Sept 2 | QCOR | 85% |
Sept 2 | ALTH | 47% |
Sept 7 | SPPI | 85% |
Sept 30 | ARIA | 70% |
Oct 8 | SPPI | 85% |
Disclosure: Long ARIA and SPPI.
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This article has 46 comments:
if spi gets aproval and moves to $15 to $20 range, i'll send you a money card for a steak dinner!
thanks for the good info..
Just a question please, where do you find the dates? Everytime news like this comes out, I'm surprised and you know the dates ahead of time. Would you please tell me how to come upon those dates so I may check my other holdings that are in various stages so I may plan instead of being surprised.
Thanks again. Great piece of good info.
Best wishes
I just started following you and Mike Havrilla. A very good article. I am watching your stocks and articles with much interest. I am investing small and just bought a small position in AEZS after selling it during it's recent drop from $2.74 to $.86. I bought at $.96 as it still has some catalysts and at that price I can afford it. I am watching SPPI and am considering a position in it too. Can you suggest a buy in price as September is usually a good month to pickup bargains!
Thanks,
Gimli
Thank you for your good advice the other day and I am studying options now.
Still holding on the ARIA and looking forward to news this month. An incredible amount of bashing going on about it...I take this to be a positive sign?! !! :)
Will have a significant amount to invest soon and am contemplating SPPI or ONTY. I too, am interested in your views on CTIC as I've reduced my share holdings by 50% in the past week and will reduce even more if it jumps over 1.60...I'm thinking no major increase until next spring.
I've recently bought heavily into ANX, decidely because of Icahn's holdings there. Also accumulating KERX...any thoughts on either of those, as well? I like KERX's small cap, they have money and their pipeline sounds impressive. Any thoughts on those, as well?
Thank you, Justin :)
Regards,
kool
I relied on the company's press release from 12/2/08 stating that they (QCOR) had actually filed a supplemental New Drug Application. Generally, the FDA only reviews sNDAs 10 months after filing, hence the 9/2/09 date.
I thought it was clear. It was not. From my view, it seems apparent that the company has not clearly communicated what is going on with their Acthar sNDA. With that said, I should have not reported it. That is my fault.
Setting that issue aside, QCOR is trading a little over 9 X earnings. I still like the play as a longer-term investment. The company is solid financially. I would be a buyer on any dips.
I hope this helps.
Justin
Thank you for your feedback! Personally, I track specific companies and keep a schedule.
I also subscribe to Mike Havrilla's calendar at biomedreports.com. It is very, very reasonably priced. I encourage you to check it out!
Justin
On Sep 01 10:58 AM TryReflexology wrote:
Just a quick thank you for useful and timely info. I'll do my homework.
Just a question please, where do you find the dates? Everytime news like this comes out, I'm surprised and you know the dates ahead of time. Would you please tell me how to come upon those dates so I may check my other holdings that are in various stages so I may plan instead of being surprised.
Thanks again. Great piece of good info.
I recall reading your interesting profile awhile back. Please stay safe out there.
Thank you for your comments! Regarding price, I think SPPI is a compelling investment right now. My 6-12 month price target range, which has been adjusted following three recent stock offerings, is $23 to $26. I am confident it will get there.
I hope this helps. Good luck and please keep in touch!
Justin
Regarding CTIC, I think it may be overvalued right here. So, I am NOT a buyer. Regarding OSIR, it remains on my Lucky 13 Buys list. For more information, I encourage you to read all (17 total) of my other articles and comments as this will help you to see where I stand on various stocks.
From my view, the best plays on obesity are NutriSystem (NTRI), Weight Watchers (WTW), and maybe Herbalife (HLF). :-)
I hope this helps!
Justin
I'm so glad to hear that you are studying options!!!! FYI: The strategies I use are the Straddle and Strangle. Both are neutral strategies and very simple to understand.
Out of all the stocks you mentioned, I like SPPI better in both the near and long-term.
ONTY remains on my Lucky 13 Buys list.
A close friend sent me some info on ANX just last night. She made a compelling argument for the company. So, I think it is worth looking at. KERX is a good company, but not on my radar - early stage pipeline.
I already told you my take on CTIC. It could move higher, but I am not interested in going near it right now. The share price is likely being manipulated as January 2010 $2.50 options, which are worthless, continue to sell hand over fist. I know, without doubt, that someone has cornered the market on those options as others I know have not been able to sell their 100 and 250 calls for MONTHS (since May). Nevertheless, tens of thousands of Jan 2010 calls have been and continue to be sold to folks, who have no idea what they are doing. Someone and only one is collecting all of those premiums. I would not touch CTIC right here.
I hope this helps!
Justin
I offered and explanation in the first paragraph.
"Odds of success (%) are derived from actual historical outcomes of previously successful drugs and companies that were similarly situated to those identified below."
I hope this helps to answer your question. Good luck!
Justin
Straddle and Strangle....hmmmm....I am not touching that with a 10 ft. pole :)
Have a good night!
kool
On Sep 02 05:44 PM Justin M. Hall wrote:
> Kool:
>
> I'm so glad to hear that you are studying options!!!! FYI: The strategies
> I use are the Straddle and Strangle. Both are neutral strategies
> and very simple to understand.
>
> Out of all the stocks you mentioned, I like SPPI better in both the
> near and long-term.
>
> ONTY remains on my Lucky 13 Buys list.
>
> A close friend sent me some info on ANX just last night. She made
> a compelling argument for the company. So, I think it is worth looking
> at. KERX is a good company, but not on my radar - early stage pipeline.
>
>
> I already told you my take on CTIC. It could move higher, but I
> am not interested in going near it right now. The share price is
> likely being manipulated as January 2010 $2.50 options, which are
> worthless, continue to sell hand over fist. I know, without doubt,
> that someone has cornered the market on those options as others I
> know have not been able to sell their 100 and 250 calls for MONTHS
> (since May). Nevertheless, tens of thousands of Jan 2010 calls have
> been and continue to be sold to folks, who have no idea what they
> are doing. Someone and only one is collecting all of those premiums.
> I would not touch CTIC right here.
>
> I hope this helps!
>
> Justin
That was good - you got me!
Justin
ARIA's management indicated 1st interim results would be available at sometime during Q3 2009 in both '09 earnings calls.
I hope this helps.
Justin
Read my comment above "REGARDING QUESTCOR (QCOR)"
Justin
Good job and nice analysis. Looking forward for more from you.
Thank you. I appreciate the feedback and respect your opinion.
Stay in touch and good luck out there!
Justin
I still like the ENDP's drug, formerly Nebido.
Keep in mind, investing in this environment is NOT easy. It is certainly not for everyone.
Good luck!
Justin
A friend of mine that is one hell of a small cap trader, his track record is impecable, has recently come up with ARIA as a viable option for me to invest in. He also came up with SPPI, but he is more optimistic about Ariad while by the sounds of it you seem more optimistic about Spectrum, can you suggest one over the other as far as an investment goes. Also what are your thoughts about CEGE at this price.
It is interesting your friend and I like the same stocks.
I like and own SPPI and ARIA both for different reasons. I would not pick one over the other. Hence the reason I own both.
I like both near and long-term. Both ARIA and SPPI have tremendous potential.
I'm sorry, but I have no comment on CEGE. I thought they were acquired awhile back.
I hope this helps to answer your questions. Take care.
Justin
My sentiment on ALTH has not changed. I would not be a buyer of shares. Today's response was telling.
I hope this helps.
Justin
Thanks!!!
481779 (please register a name! I feel like we're in prison):
Thank you for the feedback! I do appreciate it!
Regarding SPPI, I think you made a good, long-term investment decision. Investing does require commitment and you are on the right track.
I wish you the best and good luck! After you register a name :-), please keep me posted with your progress!
Justin
Thank you for the feedback! I do appreciate it!
Regarding SPPI, I think you made a good, long-term investment decision. Investing does require commitment and you are on the right track.
I wish you the best and good luck! After you register a name :-), please keep me posted with your progress!
Justin
On Sep 04 11:17 AM User 331287 wrote:
> FDA just approved SPPI's Zevalin for first line therapy. Stock didn't
> react much. Just up $.06. What type of movement would normally happen
> with this type of approval?
I posted a response on my instablog!
Justin
Please excuse the typos above. I am a bit tired.
To omit personal attacks and the childish name calling like the tactics used by "Bertrt" and his or her other aliases, click "REPORT ABUSE" and allow SA administrators to determine whether such garbage will be allowed on the site.
Also click on "Comments" in red lettering next to the user's name, i.e. Bertrt. Take a moment to review some of the other comments that the specific user has made in the recent past. As you will notice Bertrt has not tried to add anything to the discussion. Rather he or she has consistently attacked other contributors while hiding behind his or her fake name.
This person offers nothing to the discussion and DOES NOT offer any evidence to support his claims. A few things that are apparent, Bertrt is likely a short seller and not a fan of drug development (namely cancer). One could argue he is not a fan of American business, capitalism, free markets as well as free speech.
Also, if ARIA should continue to rise, what is the likelihood that the analyst (those employed by brokers) community will give it an NVAX haircut?
Thank you for your comment and support!
Regarding another retest, I do not expect that SPPI will retest its 50-day MA for quite some time. I expect shares will be driven higher from here. SPPI is undervalued following the Zevalin approval.
Justin
I like (ARIA) alot right here - prior to the announcement!
I think ARIA is in a much better position than most other cancer drug makers. From my view ARIA remains undervalued and I expect it will do very well over the coming 12 months. I am not concerned about the current price action. I think ARIA will prove to be a great play long-term. I will remain a patient investor in the company.
I hope this helps! Good luck!
Justin
I am trying to stay safe. So far the only bloodshed I am having to worry about is the slaughter in the markets! <humor gets you through where I am at and the things that happen> I am looking hard at Kerx, SPPI and possibly AGEN. I will keep you posted and am also following Mike Havrilla. Thanks for the info about the calendar on his Biomeds site. I will check it out.
From Iraq and maybe soon from Afghanistan.
Gimli
On Sep 02 05:24 PM Justin M. Hall wrote:
> GimliJan:
>
> I recall reading your interesting profile awhile back. Please stay
> safe out there.
>
> Thank you for your comments! Regarding price, I think SPPI is a
> compelling investment right now. My 6-12 month price target range,
> which has been adjusted following three recent stock offerings, is
> $23 to $26. I am confident it will get there.
>
> I hope this helps. Good luck and please keep in touch!
>
> Justin
ARIA will announce a second interim analysis in Q1 2010.
ENDP's drug (formerly Nebido) will be reviewed in December, and I think it has a good shot at approval as it will lower the cost of treatment.
QCOR recently resubmitted their sNDA.
QCOR and ENDP are both solid companies with decent earnings and I like them long-term.
ALTH's drug was approved in September.
Similar updates will be posted at my new site.
I hope this helps for now.
Justin