Catalysts That Could Triple Genta's Value This Year (GNTA)

Apr. 4.06 | About: Genta Incorporated (GNTAQ)

Genta Incorporated (GNTA) is a biopharmaceutical company with a product portfolio focused on anticancer therapy, including its Anticode platform technology, as well as other important anticancer products. The company's lead compound, G3139, has received "Fast Track" designation from the FDA and has entered Phase 3 trials in patients with advanced melanoma.

The drug application waiting FDA approval is something called Genasense, a drug given to cancer patients to assist in chemotherapy. Genasense is an antisense treatment, which consist of chemically modified strands of DNA that bind to mRNA. Genta’s goal is to see Genasense treatment as the preferred aid to chemotherapy for many different kinds of cancer. And based on recent clinical trial results, the company is well on its way.

Catalysts that could triple GENTA on October 28, 2006:

  • This $235 million company has a treatment in the works that could make chemotherapy twice as effective in the quest for killing deadly cancer cells. Its treatment is in stage 3 clinical trials, and the FDA granted the company fast track status to bring this application to market since no other treatment like it exists.
  • 60% of all drugs given fast-track status are brought to market successfully. That’s good news for this small-cap company. The odds are in its favor.
  • The only thing that stands in its way now from potentially million in profits is a few months and the FDA’s approval. Approval will either be granted or denied on Oct. 28, 2006, less than seven months from today.
  • Without getting too technical, Genasense inhibits the production of a protein. In this case, Bcl-2—a protein that is found in many kinds of cancer cells that can block chemotherapy from killing them. By getting Bcl-2 out of the picture, Genasense makes chemo and other anticancer therapy more effective at targeting and eliminating these cancer cells.
  • In the trial, 241 patients underwent cancer treatment with or without Genasense. 17% of those on Genasense achieved complete or partial remission, while only 7% of patients who were administered chemotherapy only did. Those who were given Genasense also were in remission longer. Genasense’s cancer application was twice as effective as normal chemotherapy.
  • Thanks to these tremendous results, the FDA accepted the company’s application for Genasense on March 1. The basis for the acceptance is that this treatment can help patients with relapsed or refractory chronic lymphocytic leukemia. The FDA is set to make its decision on whether the drug can be marketed on Oct. 28, 2006.
  • Genta has successfully brought one drug to market already. Ganite, an injection used in the treatment of cancer-related hypercalcemia, was approved in 2003. The company’s management has scaled down its efforts to sell the drug to focus solely on the approval of Genasense.
  • The company needs to partner with a major player in the drug market. Since Aventis left Genta high and dry, the company hasn’t had the support of a big sales and marketing staff and regular checks to cash to help pay the staggering R&D costs associated with bringing an experimental medication through the approval process.
  • Genta absolutely needs the support of Big Pharma’s deep pockets to make a profit. Right now, they’re barely paying the bills, and the company has suffered. In August 2004, Genta closed its Salt Lake City research facility. The company also eliminated 85 employees that year—including its sales force to conserve cash and focus on R&D costs for Genasense. If the approval comes, it will make it alot easier for Genta to find a partner.

    Risks to Genta

  • Given the fact that trial results have been fantastic and FDA has “fast-tracked