Biotech Sage

Biotech Sage
Contributor since: 2012
What I tried to convey in my piece (which fell on some deaf ears) are the following observation that relate to your points:
1. The significance of the results from the monkey studies, while theoretically could be classified as 'promising', were greatly exaggerated by Reynolds.
- The data (which was not included in the investor presentation) clearly demonstrates that all monkey subjects were improving, including controls. We do not know how representative the selective monkey videos of the totality of the data.
- The scale used in those analyses was a non-validated InVivo developed scale.
- The presented data was lacking basic statistical analysis.
- The most recent, largest, monkey study has never been presented.
2. While I doubt this company will seek to uplist any time soon, I think it should be the least of anyone’s concern at this point in time. While trading on the bulletin board this stock attained both liquidity and a significant market cap of ~ $400 million. Uplisting is no panacea for shareholder value, only a technical manoeuvre.
3. Somehow Reynolds was able to instill in everybody’s minds the notion that the scaffold and hydrogel as well are some extraordinary breakthroughs that will be immediately evident once entering clinical testing. Neither are! And obviously both will be subjected to rigorous testing.
4. That is a question I think investors and their lawyers should focus on. When did FDA communicate the required HDE protocols to NVIV? Needless to say Reynolds in his public presentations did not allude to the possibility of a 5 year development program. You see, I have heard concerns that InVivo’s strategy in SCI could theoretically cause compression damage in surgical patients. FDA seems to have that same worry, hence the staggered approach.
5. Unlike Reynolds assertions, let alone others, I do not believe that slight improvements in complete SCI patients could be attributed to the scaffold product in the absence of a robust controlled study. The literature documents that about 20% of complete SCI patients to improve following injury (happy to provide references). I see no shortcuts for the company and change in protocol.
6. I think recent events begin to suggest that the reasons to Reynolds’ departure are more complex than investors’ are being led to believe.
7. I sure hope for the investors that are still in the stock that this CEO remains in place. I cannot see anyone wanting to sign up to deal with the issues that have been created by the prior CEO which I suspect will have long-term ramifications.
8. I think remaining investors should continue to be worried by what has transpired. I am doubtful you will get much clarity from management.
Any investor in NVIV needs to realize that the path to potential cashflows is at least 5 years - pilot study and efficacy trial included. Since the efficacy trial will have a control arm, investors need to ask themselves what is the actual clinical risk in this technology and will it demonstrate benefit over standard of care. I stated my views in the past, and I see the risks as high. But in fairness, if clear efficacy is demonstrated (sometimes in 2018-2019), NVIV could be worth more than it is now (taking into account the required dilutions due to required financings that will be necessary to move things along).
I do not know what those governance issues were. The company was not transparent in relation to those. Instead an abrupt resignation of the CEO.
As a shareholder you should be up in arms about the complete absence of disclosure on the part of NVIV.
Absolutely. There is a natural course of recovery in SCI. Any treatment effect needs to demonstrate benefit over SOC recovery. If you think these patients will get up and run you are dreaming.
But Kudos to InVivo for making so many of you believe in that possibility. That is what I find distasteful in this company.
What debate are you talking about. PMA requirements and guidelines are not debatable.
Why has the company not included such basic statistical analysis on the data then in their presentation of it?
To allow for human clinical trials no demonstration of efficacy is required.
InVivo used their own scale for measuring recovery. A non-validated scale. No I do not agree that 2 point recovery is meaningful. Much of the data can be explained as a random walk based on cross study variability.
PMA applications have specific requirements that include the demonstration of effectiveness. The HDE path does not allow for a PMA approval. Those studies will require at least 5 years of development.
It should not be ignored. But at the same time it cannot be used as a supposed proof of efficacy. I am certain the standard error bars would demonstrate no statistical significance on separation.
The company, however, and specifically Reynolds was implying extraordinary efficacy, which is not demonstrated in these graphs and in this model . It is these assertions by him that led to the company's $400MM value.
Here you go. You don't need to rely on myself or Napodano:
From FDA's most recent guidelines: Guidance for Industry and Food and Drug Administration Staff Humanitarian Use Device (HUD) Designations issued January 24, 2013:
"FDA approval of an HDE application authorizes the applicant to market the device. This marketing approval issubject to certain profit and use restrictionsset forth in section 520(m) of the FD&C Act, 21 USC § 360j(m)."
From section 520(m) of the FD&C Act, 21 USC § 360j(m):
"Except as provided in paragraph (6), no person granted an exemption under paragraph (2) with respect to a device may sell the device for an amount that exceeds the costs of research and development, fabrication, and distribution of the device"
You seemed to have erased your prior comment, snake oil and here it is, no math required.
You obviously are resisting reading the details I provided above. Here, I will help you. As per HDE guidelines (I provided a reference in the hyperlink):
"Sponsors are limited to recovering the cost of research and development, manufacturing and distribution. They are not permitted to make a profit on the sale of the HUD, if the device is sold for more than $250."
"Allowing someone to publish an article does not make them a credible source..."
I fully agree with that statement. I disclosed the fact that I am short the stock, coupled with my analysis for the reasons I believe the company to be significantly overvalued.
You are entitled to ignore my analysis and put a bid under the stock price. I can guarantee Reynolds will still put his shares on the offer in days to come and will appreciate your support providing him with much needed dwindling liquidity.
Allowing a company to initiate human clinical trials says nothing about its efficacy. Let alone its ultimate safety. How many drugs have been pulled off the market subsequent to their full FDA approval?
I fully disclosed my position along with arguments supporting my opinions. There is nothing wrong nor illegal about that.
Have you ever complained about the fluff SA pieces pumping this stock with misleading information?
You view a sell-side analyst working for an I-bank getting paid by NVIV as credible? give me a break. Aegis did their last deal.
That on top of collecting > $1MM annual salary while serving as both CEO and CFO. Unheard of.
Have you ever complained about the CEO's misleading statements regarding its technology leading to the stock price hitting $6 a month ago? All that, while he has been selling millions of dollars worth of stock?
What truths? Read again.
The information above is well articulated with references attached. Happy to have a serious discussion.
All I am doing is to undermine its valuation. You can still hope away
Look at my arguments, data and references. Who cares what degrees and qualifications I have.
Whatever it is, point being, no profit can be made on a HUD product per guidelines.
No it is not possible that "the costs of research, development, fabrication, and distribution..." would amount to $60K per unit.
You are mistaken. Look at the data again. Figure 2 and figure 3. You are wrong. The second larger study does not show even more benefit for the scaffold seeded with hNSC. It in fact shows it to be less effective than the scaffold alone! In contrast to the first, smaller 2008 trial. It demonstrates my point that the data is inconsistent.
It is not me who cherry picks the data. It is management that does in its presentations. You should be as critical of them as you are of me.
We view the world from two different vantage points.
You assume that the scaffold will prevent the theoretical cascade of a secondary injury, preventing paralysis. I would therefore challenge you to present data that supports this assertion. Not opinions or fancy videos. But actual data demonstrating the ability of the scaffold to clearly prevent such damage and secondly, enhance recovery.
All InVivo has presented to date is monkey data, which as I highlighted above, does not prove or disprove their assertions. But making you and so many others out there believe in the miraculous features of this technology is nothing but a reality distortion field.
I do not view the mention of Dr. Langer as relevant. He is an extraordinary scientist, no dispute about that. But that does not change the objective truths that I presented, nor the development risks associated with his scaffold technology. I am in fact certain Langer would not refute any of my observations regarding the data and science.
Langer did make one error of judgement in relation to InVivo by associating himself with Reynolds who consistently was looking to gain credibility by association.
As to the company's "near term cash-flows", I do not know what you are referring to. As clearly highlighted in my piece (citations included for your reference), no meaningful sales could be generated through the HDE approval path and definitely no cashlows that can lead to profitability.
Lastly, I do not misuse any statistics since I did not deploy any statsitical analysis. Only pure and simple data analysis. In fact, what is sorely lacking is any statistical analysis in InVivo's data presentations.
The 2008 pilot study had n=1 for no treatment; n=1 for scaffold alone and n=2 for scaffold + hNSC (except for day 1 & day 44 where n=1). While you observe a score of 15 on neuromotor performance for the hNSC at day 44, that observation applies solely to n=1. On day 40, just 4 days before it is barely 12.
In the 2010 study, with just a slightly larger sample of monkeys (with n=5) scaffold+growth factors the neuromotor performance transiently hits ~11 after 60 days and then declines to below 10 thereafter.
In both studies however, the control group recovers quite well, and in fact, seems for the most part in-line with the treatment groups.
So I am not exactly sure who is cherry picking what? In one study we have data going out to 44 days. In the other, >80days. In 2008 the addition of growth factors increases the efficacy substantially, while in 2010 scaffold alone does much better.
Reynolds has made some spectacular potential efficacy claims and consistently presents a video of monkeys suggesting spectacular recoveries. Based on the data observed, control monkeys do pretty well post segmental thoracic hemisection.
Now, the level of efficacy is important. We have pricing cited between $60K-$100K for this treatment option, and hence a potential $1billion end market and the company's valuation. To support such high pricing we should see more than just safety! but indeed genuine tangible pharmacoeconomic benefits. There is very little to support these notions at this time.
FDA disagrees with what?
All FDA did was to allow for human clinical testing. That is not a stamp of approval for the product let alone suggestive of efficacy.
I asked reasonable questions. If you want to blindly invest, go ahead. I am sure Reynolds has 4,250 shares ready for you on Monday to buy.
A few observations that should make any investor pause in relation to this company:
1) Most of the preclinical work involves a small number of monkey subjects and the surgical procedure was performed by the company's own CMO. Only subsequent assessment is done by a blinded reviewer.
2) The 2010 primate data clearly demonstrates that control monkeys exhibit significant recovery following segmental thoracic hemisection. In fact, when looking at the data we see no difference whatsoever between the control group and the scaffold+growth factor group to ~50 days. And only then do we get a slight separation. It is clear that there is no statistical significance between the arms based on the small separation and numbers of subjects.
This goes against the outlandish claims made by the CEO about getting patients out of wheelchairs and selective video presentations of monkeys supposedly making a miraculous recovery.
3) Why was the data reported solely to just ~80 days? What was observed subsequent to this time frame?
4) What were baseline measures for the monkeys involved in those studies? Shouldn't assessment be reported as % of baseline prior to hemisection to demonstrate actual recovery?
Now many questions remain in relation to the actual human studies the company proposes to conduct. Here are some issues to consider:
5) The monkey studies had controlled spinal injury performed by a surgeon. Actual SCI subjects will have variable types of injury and highly variable baseline parameters including: Time since injury, location and baseline function that could correlate to age and fitness. So what is the actual endpoint that NVIV will explore in those subjects and what specific type of patients will they be looking to enroll to reduce heterogenisity of outcomes?
6) Based on the monkey data we do not see significant separations on recovery between treatment arms. So what would be required to demosntrate efficacy from a regulatory standpoint, let alone commercial one?
7) The company is proposing fairly small pivotal studies of 30 subjects. What would be the powering assumptions for this trial? Based on the early monkey data it seems a 30 subject trial is underpowered to demonstrate any potential meaningful statistically significant improvements.
Importantly, none of the above seems to be addressed in the company's updated investor presentation. Instead CEO is using a few video presentations from the limited 2009 primate study that had only 1 control monkey! Further, that same CEO has been selling shares continuously in the open market while collecting close to a $1 million annual salary. Buyer, beware.
Platform aside. A CEO that takes home close to $1 million annual salary and continuously sells shares in the open market with such weak balance sheet stinks. Shareholders should not support such behavior.
Thank you for your kind words. Happy it worked out well for you.
As much as I like the guy, he seems to increasingly become a liability.
Happy to hear that! congrats
Per company PRs, data should be as originally planned based on FDAs feedback - i.e. early Q2. CEO has mentioned April on a few occasions before the January events.
Ocular visual symptoms have been described for around 2% of women on long-term studies.
I have not been able to find large long-term studies in males. Most have <100 subjects.