I like to look for smaller companies that I would describe as "Diamonds in the Rough." These are small cap companies that I come across that I think have a great opportunity for revenue growth in the years to come but are not at the revenue generating stage yet. One of the areas that I look through periodically is the biotech field. Here I look for companies that look like they may be able to bring a drug to the market that has the potential to be highly successful.
There has been a drug on the market for years that has been "the standard" for treatment for numerous forms of cancers. I believe I have found the company that has a drug in the trial stage that has been performing significantly better for cancer treatment then "the standard accepted drug" of today. If trials continue as successfully as they have, I can imagine this new drug taking the place of the old one. We have an instant market with a huge revenue stream. The name of the company is CytRx (CYTR) and the name of the drug is aldoxorubicin.
One of the reasons investors are taking an interest in CytRx is because of the recent trial results of its drug aldoxorubicin. This drug holds a lot of promise for revenue for the company.
Aldoxorubicin is a newer form of chemotherapy treatment associated with doxorubicin. Doxorubicin has been used in chemotherapy for decades, but the newer form, aldoxorubicin, appears to have more promise.
A mid-stage clinical trial compared the two drugs in patients that had soft tissue sarcoma. In that study 22% of the patients treated with aldoxorubicin responded to the treatment while none of the patients on the other drug responded at all. The treatment defined-"response" as patient's tumor shrank by at least 30% and no new tumors developed.
Doxorubicin is widely considered a "first line treatment" for patients with metastatic or locally advanced soft tissue sarcomas. It appears that the present "standard of care" could not hold up to the results with aldoxorubicin. The "second-line" Phase 1B/2 clinical trial in patients who failed other therapies has shown favorable results for the drug as a first line treatment.
Top-line data for the global Phase 2B clinical trials are expected to be reported in December 2013.
Pres. and CEO, Steven A. Kriegsman, described the drug's potential when he said,"We are compiling an ever-increasing portfolio of impressive human and preclinical data that aldoxorubicin could have an essential role in the treatment of patients with a wide range of cancers."
Can the company's "linker technology platform" become the foundation for an oncology-based drug treatment company with the ability to treat a wide range of cancers? Can it become a multibillion-dollar revenue producer?
Today, doxorubicin is used in a wide variety of treatments for cancers, including: bladder, breast, head and neck, some types of leukemia, lung, lymphomas, mesothelioma, multiple myeloma, neuroblastoma, ovary, pancreas, prostrate, sarcomas, stomach, thyroid and uterus. Imagine the potential if aldoxorubicin became the preferred replacement for doxorubicin. Clinical trials are making this look more and more like a reasonable possibility.
As I stated at the beginning of this article, CytRx is in the developmental stages and has yet to generate revenue on its books. Although it looks like aldoxorubicin is an excellent candidate to replace doxorubicin as a major treatment in the area of oncology, investors need to be aware of the risk factors involved in companies with an unproven revenue base.
The stock has recently climbed on the good news of the recent trials that I mentioned in this article but there are no guarantees it will continue to climb. The biotechnical industry can be very volatile and I would encourage investors who are interested in these types of investments to research the company in more depth for themselves. The best way to start is to go to CytRx's homepage and go through their website and understand the company in more depth.
It appears aldoxorubicin has the potential to place a very strong foothold in the oncology market. It makes sense the way CytRx is researching and presenting this alternative drug to a market that already exists. Here are some examples of further testing that the company is doing on this drug:
- Aldoxorubicin has the ability to cross over the "blood brain barrier" that separates the brain from the circulatory system when treating brain tumors. Doxorubicin does not have this ability and is thus considered not effective treatment for brain tumors.
- The two drugs are being compared as to how long patients survive before they die or the disease they have resumes progression.
- Aldoxorubicin will be involved in another mid-stage trial as a treatment for glioblastoma which is a very aggressive form of brain cancer.
- There also is a late stage trial as a treatment for soft tissue sarcomas that have continued to grow after chemo treatment. That trial should start the first quarter of 2014.
You can find more information on these studies and go through each one of them in depth. CytRx might be a good long-term investment for those who enjoy taking risks in companies that are just entering the revenue generation stage.