Zalicus' Potential Might Be Worthy Of A Nobel Prize

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 |  About: EPIRUS Biopharmaceuticals, Inc (EPRS), Includes: MRK
by: Ramsay Schrum

The bold statement found in my title is not just for show; Zalicus (ZLCS) is opening a new door that will improve the lives of millions of people around the world.

I listened to the recent conference call in New York at the JMP Securities Healthcare Conference and you can hear the excitement in management's voices. They touched on a topic that is very important to me and I feel that it needs to be loudly voiced.

Z160 and Z944 N type and T type calcium channel blockers have the possibility to create the first pain management drug that is orally administered without the abuse and addictive side effects that come with the use of opioids. Millions are effected every year by opiods and the addictive side effects they cause. Many patients have to deal with withdrawal, overdoses, and the potential these drugs have when in the wrong hands outside a doctor's written consent.

The potential here has Nobel Prize written all over it. Doctors, the FDA, and the effected opioid patients have wanted this advancement for decades and hopefully Zalicus will be there with Z160 & Z944. These two drugs are just the tip of the iceberg to the drugs that will follow from their advancements.

As stated in the Q&A they have already had multiple partnership meetings with big pharmaceutical companies. This is the first time that information has been shared. We all know the potential that these drugs have and that was shown by Merck's (NYSE:MRK) involvement a few years ago with an earlier formulation of Z160 that Merck ponied up over 475 million dollars for. With the new formulation of Z160 having solved the bioavailability issues, CFO Justin Rentz stated that Zalicus does not want to show its hand too soon. Zalicus is looking out for shareholder value and wants to take it further into studies before letting the cat out of the bag so it can fetch top dollar. It looks like to me big pharmaceutical companies are clawing to get their hands on Zalicus's pipeline.

Zalicus as of last quarter has 52 million in cash with a current quarterly cash burn rate of 11 million. The cash burn is primarily due to late stage study advancements like Synavive in Phase IIb, as well as the ion channel programs. With the current PPS floating around the $1.00 range it has a market cap of roughly 106 million.

Other things in the meantime to look forward to is top line data for Phase IIb studies on Synavive coming in September. Sanofi (NYSE:SNY) announcing a Phase III start on FOV1101 with their 2nd quarter results. Covidien (COV) is currently working on the new 32mg dosage with Exalgo, as well as possible oncology pre clinical candidates from the Novartis (NYSE:NVS) collaboration all make for an exciting summer.

All in all very exhilarating news with a once in a lifetime opportunity.

Disclosure: I am long ZLCS.