Five Presentations from the Recent Biotech Investment Conference

Medivation's Presentation: Standing Room Only

A little more than 24 hours after announcing its big, lucrative Alzheimer's drug partnership with Pfizer (PFE), Medivation (MDVN) had the lead-off position (I wonder if they told organizers they'd be a newsmaker) at yesterday's BioCentury/Thomson Reuters biotech investment conference in New York City.

Medivation CEO Dr. David Hung did the honors before a crowd of around 100. It was not standing room only, but close. (Some investors measure Wall Street interest in a company/stock by attendance at events like this.)

Dr. Hung already had a colorful, fully-produced PowerPoint slide detailing the deal toward the top of his presentation. One column was titled "Pfizer Powerhouse", referring to the company's Alzheimer's drug know-how and its wide-reaching sales force.

Most of the stuff in his formal remarks was rehash, but in the breakout session that followed (that's where attendees throw questions at executives from presenting companies) a MDVN exec provided an interesting peak behind the corporate due diligence curtain.

He said that Pfizer had a team of 25 people looking at the drug for about six months. The vetting, he said, "was as thorough as it gets." PFE even sent people to Russia where Alzheimer's tests were being done because the drug, called Dimebon, is an old antihistamine in that country.

Dr. Hung said he likes "to discover diamonds in the rough" like Dimebon and that it took him about two years to find it. "We probably say 'no' to more than 99 percent of (the drugs) we see," he said.

The breakout session, by the way, was standing room only.

Orexigen and Its Obesity Bets

After Medivation, I moved onto the Orexigen (OREX) presentation. It's a company I profiled when it had data on one of its fat-fighting drugs at last year's diabetes conference, so I wanted to check up on its progress. It was SRO at the main and breakout sessions, but they took place in smaller rooms than MDVN's.

Orexigen is one of those companies that tries to turn trash into treasure. In other words, it takes old, generic drugs and mixes them together to hopefully do new things. Orexigen actually has two diet drugs in mid- to late-stage development. The one that's furthest along is Contrave. It's a combination of a drug for alcoholism and smoking cessation. Orexigen is aiming the drug at mild to moderately obese women.

In one study patients lost as much as 11 percent of their body weight in as many months. But as many as 30 percent of patients got nauseous.

OREX may have Phase 3 test results on Contrave late this year or early next. Graham Cooper, the CFO, strongly hinted at the breakout that the data could be released at the huge JPMorgan Healthcare Conference in January. OREX plans to file for FDA approval of the drug in late 2009.

Cooper also said the company will likely want to find a corporate partner with a big sales force for Contrave once the first Phase 3 results come out. "The time to do that (collaboration discussions) is once we open the envelope (on the test results) and see who shows up (potential interested partners)," Cooper said.

The second diet pill is called Empatic. It's a combo of the same stop-smoking drug and an epilepsy treatment. The company thinks it's probably best suited for very obese older men and women. In one test patients shed 15 percent of their weight over 11 months.

Orexigen expects to move Empatic into a big, late-stage clinical trial late next year.

Amylin's Byetta Battle

Of the 36 companies presenting here, investors are probably most interested in the update from Amylin Pharmaceuticals (AMLN). The stock has been on a slide since the FDA and the company disclosed a total of six deaths among diabetics who developed pancreatitis after taking Byetta, the twice-a-day injectable drug from Amylin and Eli Lilly (LLY).

The CFO Mark Foletta did the presentation to the approximately 100 people in the room. CEO Dan Bradbury didn't make it. Foletta went over the facts that I reported on "Fast Money" when the news broke last week--media coverage that he said has "created some confusion in the marketplace."

"While serious," Foletta said, "it's a condition that is rare and is not new. There's no definitive causal relationship between Byetta and pancreatitis, but a possible association is being explored."

Foletta said he thinks the FDA could change the Byetta label regarding the suspected pancreatitis risk around the time it's expected to make a decision on the approval of Byetta for use as a stand-alone treatment for diabetes. That's supposed to happen, Foletta said, by the end of the year.

He also mentioned -- and I think this might be new -- that a "major national insurance carrier" informed the company late last week that among the nearly 40,000 patients it has on Byetta there is "no difference" in the incidence of pancreatitis versus diabetics on other drugs.

One observation, though. Foletta didn't acknowledge the elephant in the room--the pancreatitis-related deaths--until around seven minutes into his formal presentation. In the news biz, that's called burying the lead.

Celgene's Success Story

One of the biggest biotech success stories was among the companies featured in the afternoon sessions.

I'm talking about Celgene (CELG). CFO Dave Gryska gave the presentation in the biggest room, but it's far from SRO, I suspect, because so many investors already know the CELG story. A lot of the attendees here are looking for the next Celgene--if there is a company still out there that could duplicate its success.

Steve Brozak of the boutique biotech research firm WBB Securities, one of the event sponsors, introduced Mr. Gryska. He held up a 10-year-old program from this conference that contained a profile of one of its presenting companies: a microcap called Celgene with a $120 million market value.

Today CELG is worth $31 billion! I think I started covering them when the market cap was about one-tenth that amount. In the past 10 years Brozak said CELG has been the sixth-best performing stock in the world. "And it's still a very promising story," he said.

When Brozak picked up coverage of the then little-known company a decade ago he said several clients laughed at him as he tried to pound the table on a biotech trying to bring thalidomide back to market.

Celgene not only did that, but also brought a successful new cousin of thalidomide, called Revlimid, to market for the treatment of blood cancers.

Consider the source, but the CFO Gryska told investors his company, unlike big pharma, has an embarrassment of riches. "We don't have a problem with our (drug development) pipeline. We have too many things to develop. We have a wealth of pipeline products," he said.

Update: In the breakout q and a session one long time CELG investor asked the CFO if he'd sell the company to Pfizer. Gryska gave a bit of a boilerplate answer and then some. "If there's something that makes sense that obviously maximizes shareholder value, then we're gonna look at it intensely," he said. "But we're not worried about Pfizer. Our intention is to be bigger than Pfizer." To which the questioner quipped, "You will be." They've got a long way to go.

At the End of the Day: Dendreon

Dendreonians, the wait is over. Dendreon (DNDN) had the second-to-last time slot at the BioCentury/Thomson Reuters biotech investment conference yesterday afternoon.

CEO Dr. Mitchell Gold wasn't there. CFO Greg Schiffman made the presentation to around 35 people. He kicked things off by proclaiming his company, "One of the more exciting stories in biotech today." Exciting? Controversial might be more accurate.

Dendreon is getting closer to a potentially huge milestone. Schiffman reiterated that the company expects to see interim data on its prostate cancer drug next month. He didn't get any more specific about the timing.

If the results look good, Dendreon says the FDA has indicated it would approve the drug at halftime. But if the survival numbers aren't there, Dendreon says it will have to keep at it through next year.

Analysts and the Street remain skeptical the midway results will be strong enough. A lot of investors are still betting the stock will go down by taking short positions. And many of the naysayers may feel emboldened by the failure last week of a similar drug from Cell Genesys [CEGE].

But Schiffman said the clinical trial is "well powered" to have a "reasonable possibility" of reaching statistical significance on survival by the interim. However, he hedged a little. "We're very excited about the timeframe," he said, "but, I do want to point out that the final (results) always has a higher probability of success." Again, the final results aren't expected until next year sometime.

The Dendreon breakout drew, by far, the fewest people of the ones I've attended today. Nine investors/analysts plus me and a Dow Jones reporter. Read what you will into that.

One of the attendees asked how much the drug, called Provenge, would cost. Schiffman said, "It's not gonna be an inexpensive treatment." When pressed for a dollar figure he only said it would likely be priced in line with other novel biologics. The questioner threw out the figure $20,000. "Probably above that," Schiffman said, adding that novel biologics cost about twice that amount. Presumably that would be for the full three-infusion treatment.

And a disclosure: GE (GE) Healthcare, part of CNBC's parent company, is one of the sponsors of this conference.