Biosante (BPAX) deserves attention from the Seeking Alpha community, especially since it was at center stage of the penny-land biotech community going into December 2011. The question on Biosante's investors' minds is: Will Libigel make a comeback? I imagine answers range from the pejorative to unbridled optimism, from, 'No way!' to 'Yes way!'
But in no way do I read CEO Simes stating that it is giving up on Libigel in Tuesday's press release. At least, not yet. Instead, the small biotech is undergoing a necessary review of its corporate strategy, but re-read what the company stated about LibiGel:
- "Biosante continues to analyze the Libigel data from the two pivotal Phase III efficacy trials first reported on December 14, 2011. Libigel is in development for the treatment of female sexual dysfunction (FSD), specifically, hypoactive sexual desire disorder (HSDD) in postmenopausal women, for which there is no FDA-approved product."
Notice, the company states "continues" and "is" -- both words indicating that while the company is well aware of phase 3 trial results, it has not closed the door on Libigel's development. Could it? Yes. But has it? No.
What we all do know is that the so-called 'placebo effect' washed out the Libigel efficacy effect. But why did that happen? That remains a hotly contested issue. For example, I remain perplexed by the (1) many uncontrolled variables, (2) how the study was heavily weighted toward subjective less-scientific measurements, and (3) how restoring testosterone levels was not a key or primary measurement of experimental success. But some have suggested that this is what the FDA intended -- to prove Libigel's end-use would ultimately be limited to a narrower field of FSD (female sexual dysfunction) patients.
One thing is certain. Biosante will meet with the FDA: "It is Biosante's objective to meet with the FDA to determine the best path forward, and to make a decision whether to continue the Libigel safety study within the next 90 days." That is because the project, while it remains on life-support, isn't dead.
From a scientific perspective, were I a Biosante executive, I would request the FDA approve a smaller, 200 size phase 3 study that limits the variable pool and narrowly focuses the study's end-points on objective measurements. I also like the idea of all 200 subjects starting on placebo (measurements taken as a baseline) before a blinded percentage is moved to Libigel. I state this because it is my experience that any physiological event such as a female's orgasm can be quantified into observable and quantifiable measurements versus the less scientific and psychological question of: 'Did it feel good?' or 'Were you satisfied?'
Biosante got a black-eye, but so does a brave boxer who one day wears the championship belt. The FDA needs to work with Biosante if it ever intends to control testosterone use in FSD patients, and the safety study is very important to understanding overall female health in those who take testosterone. The FDA, to be responsible, cannot let these issues go; not when FSD is recognized as a quantifiable and observable malady by millions of female patients.
Unfortunately, the issue in biotech penny-land is having the financial resources to persevere. I maintain Biosante should persevere, and if necessary, bite the bullet and partner with a much larger deep pocket. Right now Biosante is in 'damage-control' reminding investors of its assets and its pipeline and that is all well and good. In my opinion, while Biosante is at a miserable 65 cents/share, I think a strategic plan to bring Libigel forward with the FDA's support would immediately trigger a triple percent gain. Why? Because like me, I think there remains enough money out there that is ready to hedge its bet on the female Viagra called Libigel.
Disclosure: I am long BPAX.
