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  • Mallinckrodt Keeps On Winning For Investors

    This morning Mallinckrodt (NYSE:MNK) posted another solid quarter by reporting an earnings beat with its F2Q EPS of $1.72 that came in over +$0.22 vs. consensus estimates. Earnings were successfully driven up by its strong specialty generics business and lower tax savings.

    Given the spectacular results, acquisition integration, and further diversification of its portfolio, Mallinckrodt also announced that it raised FY2015 guidance by $0.35 to reflect its fundamental strength.

    What may drive shares higher into the second half of the year is its improvement in seasonality in Acthar (with 19 approved indications), Ofirmv sales, and the recent close of the Ikaria transaction. This current quarter's Acthar sales were $228M driven by growth in rheumatology and pulmonology, which was in-line with analysts' estimates and it saw sales in Ofirmev of $68M. Also, management stated in its earnings conference call a continued commitment and focus on improving the efficiency of its prescription processing and distribution systems.

    I believe that many of the top investment funds started entering the company back a while ago and most strong dips or fades have been met with a revival of its share price moving higher as you can see by the chart below.

    (click to enlarge)mnk

    Lastly, I believe that Mallinckrodt will be another big winner going into EOY 2015 just like it did in 2014. Management is focused on real results quarter after quarter and a core stock to hold in your portfolio. If you have followed me over the last year of so, you have done well investing in first Questcor (who developed Acthar) and then Mallinckrodt (who ultimately acquired Questcor). My current recommendation is to stay the course.

    Tags: MNK, long-ideas
    May 05 2:48 PM | Link | Comment!
  • BioTime - Leading The Charge In Regenerative Medicine, Next Gen Cancer Diagnostics, Stem Cells And Mobile Health

    Header

    Spacer

    Summary of Topics

    • Investors may not know that BioTime is positioned as a leader in Regenerative Medicine.
    • The company has 6 products in clinical trials.
    • The company is building a World-Class team.
    • Key partnerships and/or collaborations are impressive.
    • Early investors will be rewarded as key milestones are announced in 2015-2016.

    BioTime, Inc. (NYSEMKT:BTX) is a biotechnology company focused on the emerging field of regenerative medicine. It holds the most stem cell patents for a single company worldwide and over the longer term offers considerable promise for the development of a number of new and developing therapeutic cancer products. Its goal and focus is to become an industry leader by providing regenerative therapies for age-related degenerative diseases with the use of its over 600 patents and patent applications worldwide.

    Commercial Strategy:

    BioTime looks like its building a World-Class team of researchers and advisors with extensive clinical and drug development experience. It's developing a plethora of stem cell and other biomedical products for the advancement of its proprietary technology, research, therapeutic, and diagnostic use through its subsidiaries:

    BioTime Subsidiaries

    Business

    % Ownership

    Country

    Asterias Biotherapeutics (click)

    Stem Cells

    71.60%

    USA

    BioTime Asia (No link)

    Stem Cells for Research

    81%

    Hong Kong

    Cell Cure Neurosciences (click)

    Cancer Diagnostics

    62.50%

    Israel

    ESI BIO (click)

    Stem Cell Products

    100%

    Singapore

    LifeMap Sciences (click)

    Genetic, Disease,

    73.20%

    USA

    Stem Cell Databases

    LifeMap Solutions (click)

    Mobile Health (mHealth)

    Owned by LifeMap Sciences

    USA

    OncoCyte (click)

    Cancer Diagnostics

    75.30%

    USA

    OrthoCyte (click)

    Orthopedic Diseases

    100%

     

    ReCyte Therapeutics (click)

    Vascular Disorders

    94.80%

    USA

    Source: BioTime 10Q

    I believe that BioTime is still relatively undiscovered, but the deeper you look, you will see that it has multiple shots at the goal. Unlike many small biotech firms with just one drug or product in develop- ment, BioTime has 6 products in clinical trials. These projects are balanced with short and long-term projects which are briefly touched on below. To execute on its strategies, the company has been recruiting some top names in the emerging field of regenerative medicine from companies like Shire and Questcor Pharmaceuticals (acquired by Mallinckrodt; (NYSE:MNK) in 2014 for $5.8B) just to name a few.

    (click to enlarge)

    Spacer2

    Key Partnerships and/or Collaborations Include:

    1. The Wistar Institute
    2. Icahn Institute at Mount Sinai
    3. California Institute for Regenereative Medicine (CIRM)
    4. Cancer Research UK (CRUK)
    5. Cancer Research Technology (NYSE:CRT)
    6. The Stem Center at Palma de Mallorca in Spain
    7. Weill Cornell
    8. UCLA
    9. Johns Hopkins University Medical Center
    10. GE Healthcare (NYSE:GE) and others

    In the field of stem cells exists two sides; optimism about the use of stem cells and those in disbelief. Sure, it's clear that there exits some evidence of over statements about stem cells and what the future of stems cells can and will look like in the future. Questions are being asked like; what will stem cells mean as a meaningful platform for science and advancing the field of regenerative medicine? I could probably write a dissertation about this, but for this article I would say that stem cells can be used in a variety of mechanisms of action, some of which are described below.

    The industry as a whole will have to overcome its challenges one step at a time. I believe that BioTime is working towards this goal of achievement. As I mentioned earlier, the company currently has 6 products in clinical trials, each of which is based on very strong science and also addresses a very large unmet medical need which therefore translates into a large market opportunity for those involved.

    Try and think about stems cells in this context. Let's say that your heart, eye or some other tissues are failing. By replacing the damaged cells with new stem cells to repair the damaged cells would be the goal. The normal process of replacing damaged cells is limited, so transplanting stem cells to an affected area would help assist the body to make the necessary repairs. In this scenario, these improvements would revolutionize medicine and improve upon a patient's quality of life dramatically.

    I believe that the company is at an "inflection point." We are seeing many years of science and industry relationships in order to distinguish its science, technology, and actual products from all of the hype that may have presented itself following President Bush's acceptance of the use of stem cells which to some extend are misunderstood as the "most promising evidence" that one day they might be used to grow or repair damaged tissue.

    Some Current Projects - Getting You Up To Speed

    GE Healthcare

    Last December 2014, BioTime and its subsidiary ES Cell International ("ESI") and GE Healthcare ("GEHC'') signed a set of license agreements in which GEHC received the rights to ESI's stem cell patents and ESI received rights to stem cell patents controlled by GEHC. This agreement will help in the development of cellular assays and models derived from stem cells for use in drug discovery and toxicity screening. This is a significant goal within the industry as expressed by Dr. Stephen Minger who is leading the efforts as Chief Scientist of GE Healthcare's Research and Development for Cell Technologies. I had the privilege of attending a meeting where he disclosed to a group that;

    Yes, GE is getting into the stem cell business in a very big way.

    Also, in a Forbes article Dr. Minger stated that;

    "the field is emerging from the shadow of skepticism and experimentation."

    GE is literally spending billions in research in the pursuit to help Big Pharma save multiple millions if not billions in research dollars by using stem cells for drug screening and predictive toxicology. Imagine spending hundreds of millions if not billions of dollars in drug research and then come to find out that your new leading new drug had cardio toxicity issues and was abruptly pulled off the market. Drugs are screened in animal models vs. humans. If toxicity problems are detected too late everybody loses. So, the goal would be to reduce the risks early on in the process before investing multiple millions related to new drug development. GE's commitment as evidenced by its stem cell programs further validates that the industry is real, growing, and gravitating forward to positively improve on more reliable outcomes with enhanced drug screening programs.

    PanC-Dx - Bladder cancer diagnostics with collaborator Johns Hopkins University School of medicine, an established leader in bladder cancer research

    As announced on March 20, 2015 BioTime's subsidiary OncoCyte will be presenting data at AACR conference in April. I believe that the key takeaway that we want to look for is the worldwide market potential of PanC-Dx™, OncoCyte's class of non-invasive cancer diagnostics based on OncoCyte's proprietary set of cancer markers. Only limited data was disclosed except that the evaluation of the performance of its gene panel indicated high levels of sensitivity and specificity of "greater than" 0.9 or 90%. This is impressive.

    Overall, markets for bladder cancer diagnostics are large and growing for new and reoccurring screening. The World Health organization's World Cancer Report reported that cancer rates are set to increase at an alarming rate globally and could increase by 50% by 2020. It only makes sense that testing will rise and is highly recommended and will be widely performed worldwide.

    OpRegen
    On October 6, 2014 - BioTime's Subsidiary Cell Cure Neurosciences Ltd. Filed an Investigational New Drug (NYSE:IND) application that was filed with the FDA for OpRegen® for a Phase I/IIa dose escalation trial in patients with dry-AMD and designed to treat patients with the dry Form of age-related macular degeneration (dry-AMD).

    OpRegen® will be the first preparation of xeno-free RPE cells to be evaluated clinically for dry-AMD. There are estimates that suggest that wet-AMD is an $8B industry and accounts for only 10% of macular degeneration. 90% of macular degeneration comes from the "dry" form, so its product could offer patients a therapy where there is a very real unmet need. On November 3, 2014 it received FDA authorization to initiate Phase I/IIa trial of embryonic stem cell-derived OpRegen® for the treatment of the dry form of AMD. To date, "no" approved therapy exists for dry-AMD, the leading cause of visual impairment in the aging population.

    AST-OPC1
    October 20, 2014 - BioTime's Asterias Biotherapeutics (OTC:AST) with a focus on Neurodegenerative Diseases announced a Notice of "Grant Award" with the California Institute for Regenerative Medicine (CIRM) for Phase 1/2a Clinical Trial of AST-OPC1 (oligodendrocyte progenitor cells) in complete cervical spinal cord injury a potential $3B annual US revenue opportunity.

    VAC-2
    BioTime's Asterias Biotherapeutics is also partnered with Cancer Research UK (CRUK) to conduct Phase1/2a Dose escalation study for AST‐VAC2 Immunotherapy for lung cancer; Valued at $20million to $30million. Cancer Immunotherapy market projected to reach $35B in annual revenues by 2024. AST's‐VAC2 mechanism of action (MOA) is likely synergistic with that of other immunotherapies such as immune checkpoint inhibitors. Its initial indication of lung cancer Selected due to high level of unmet medical need.

    Renevia
    November 4, 2014 - BioTime, reported that it has received authorization to begin its pivotal human clinical trial of Renevia™ in Europe. In the trial, Renevia will be used in combination with the patient's own fat-derived cells and injected into portions of the patient's face where there has been a loss of fat from under the skin (lipoatrophy). Lipoatrophy is estimated to occur in 35-50% of the 10 million HIV patients on antiretroviral therapy. This pivotal trial follows the previous successful safety trial of Renevia, the completion of which was announced earlier back in 2014.

    Mobile Health
    Mobile health or "mHealth" is another large opportunity that's gaining more media coverage. Corey Bridges, the CEO of BioTime's LifeMap Solutions is leveraging its mobile platform. Earlier in his career, he helped launch such technological advancements like Netscape and Netflix (NASDAQ:NFLX). Well, he's is back and in the forefront again as a "disruptor" leading the change in mobile health. There are already two news releases which may be the start of multiple "skunk works" type projects (highly secretive) that are underway at the company:

    1. Icahn School of Medicine at Mount Sinai and LifeMap Solutions Launch Asthma Study for Apple's iPhone (NASDAQ:AAPL)
    2. LifeMap Solutions and Mount Sinai - National Jewish Health Respiratory Institute Launch Pilot Program of COPD Navigator App

    Lastly, the takeaway from this article should be that BioTime, for the most part, is evolving from what you might think of as an early stage science project company to a more investable company that funds can start to take notice and I believe that they are. The company is transforming and we are just starting to see the beginning of ongoing data and news flow. I suspect that upcoming news on its progress will translate into a rapid cadence of milestones from its 6 clinical trials. The company only needs to hit on a few of these projects to create significant value for investors. Also, Broadwood Capital is BioTime's largest shareholder and I'm very encouraged by their rising interest in the company. Currently, Broadwood owns approximately 17.83M shares as filed in October 2014 and that's up from 9.52M shares as reported in January 2014. Broadwood was an early investor in Questcor Pharmaceuticals (with only "one" product in its pipeline - Acthar) where they saw the stock rise from under $1.00 to the eventual $5.8B buyout from Mallinckrodt Pharmaceuticals in 2014.

    Apr 06 11:10 AM | Link | Comment!
  • A Few Stocks To Accumulate

    Here are a few stocks to accumulate on the biotech turbulence that is occurring.

    Sorrento Therapeutics (NASDAQ:SRNE) - I like this company's collaboration with NantWorks the brainchild of Dr. Patrick Soon-Shiong the inventor of Abraxane. Remember that on March 16, Sorrento announced a $110 million collaboration agreement with NantCell, a subsidiary of NantWorks, to develop anti-cancer immunotherapies. This is the company's second agreement with NantWorks in three months. Under the new agreement, Sorrento could license a number of immune-checkpoint antibodies, immuno-oncology antibodies, antibody-drug conjugates, and CAR-TNK products.

    Sorrento is also involved with Conkwest. Conkwest is focused on developing CAR-TNK cancer therapies (Natural Killer Cells). This could get exciting and we await further details of the Conkwest IPO that should happen in 2015.

    BioTime (NYSEMKT:BTX) - A pioneer in regenerative medicine has multiple projects that they have been working on for years. This stock is still relatively undiscovered, but seems to be starting to gain some attention with investors lately. I have this company as a Top pick for 2015. I believe that patient investors will be rewarded.

    BioTime is aware that it needs to Balance the short term projects as it looks out to its longer term stem cell initiatives. As a stem cell leader, it is developing a plethora of stem cell and other biomedical products for the advancement of its proprietary technology, research, therapeutics, mHealth and diagnostic expertise through its multiple subsidiaries worldwide:

    BioTime Subsidiary

    Business

    % Ownership

    Country

    Asterias Biotherapeutics (click)

    Stem Cells

    71.60%

    USA

    BioTime Asia (No link)

    Stem Cells for Research

    81%

    Hong Kong

    Cell Cure Neurosciences (click)

    Cancer Diagnostics

    62.50%

    Israel

    ESI BIO (click)

    Stem Cell Products

    100%

    Singapore

    LifeMap Sciences (click)

    Genetic, Disease,

    73.20%

    USA

    Stem Cell Databases

    LifeMap Solutions (click)

    Mobile Health

    Owned by LifeMap Sciences

    USA

    OncoCyte (click)

    Cancer Diagnostics

    75.30%

    USA

    OrthoCyte (click)

    Orthopedic Diseases

    100%

     

    ReCyte Therapeutics (click)

    Vascular Disorders

    94.80%

    USA

    Source: BioTime 10Q

    Karyopharm Therapeutics (NASDAQ:KPTI) - There is significant news flow expected for the coming year from the company's pipeline regarding its Selinexor therapies. It has a potential initiation in 1Q15 as a single-agent in a directed trial in multiple myeloma, and then numerous PII combination treatments to follow. Most analyst targets are in the $50's for KPTI. Positive news will be needed.

    ZIOPHARM (NASDAQ:ZIOP) - A biopharmaceutical company currently in developmental stage that seeks to acquire, develop and commercialize, on its own or with commercial partners, a diverse portfolio of cancer therapies. ZIOP has a Sleeping Beauty agent. ZIOPHARM's technology platform employs Intrexon Corporations (NYSE:XON) RheoSwitch® system technology to turn on, off, and modulate, gene expression at the cancer site and is uniquely positioned as the first clinically-evaluated gene switch with in vivo data showing the ability to control gene expression with a broad dynamic range.

    The RheoSwitch® platform further provides a mechanism for titrating therapeutic effects on a patient-­specific and predictable basis, as well as a safety switch to rapidly turn off gene-­expression. Importantly, the ability to administer or withdraw veledimex to sustain continued treatment cycles is a key benefit of such a switch technology. (Source: dna.com)

    Mar 25 11:32 AM | Link | 1 Comment
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