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Nir Etkovitz
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Ph.D in the Faculty of Life Sciences, Bar Ilan University, Israel Post Doctorate, Weizmann Institute of Science, Israel Program Manager at Peerion ltd. publisher of 14 research articles in professional journals. Junior Staff, Instructor in Academic Courses. studies in Economics, Israel.... More
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  • BIND Therapeutics Inc (NASDAQ:BIND) Is Ready For The Next Step

    In my previous article, published on Dec. 12th, 2013, I reviewed the company`s technology and development. Below I present an update on recent data and events of BIND Therapeutics Inc (NASDAQ:BIND). As a PhD in the biochemistry field I believe that BIND, with her nanomedicine platform represents the next stage in the evolution of targeted therapies and nanomedicine.

    BIND Therapeutics, which was founded in May of 2006 and went public in September 2013, is a clinical-stage company developing polymeric nanopracticles. These nanopracticles, i.e. Accurins™ is designed to target specific cells or tissues at three levels: tissue, cellular and molecular. Accurins™ have the potential to significantly improve efficacy and safety, which is currently not achievable through other therapeutic approaches. This improvement according to the new data could provide a new "life" to old drugs. Given that the new trend in the drug industry is the combination of drugs, this Accurins™ could replace the old docetaxel mono-treatment for example, and enhance the effect of the combination of docetaxel with other drugs.

    In my recent article I reviewed the company`s pipeline. It includes two types of programs: (1) proprietary and (2) collaboration (see Fig below). BIND`s current development focus is mainly in oncology, with its leading drug candidate BIND-014 in phase-II clinical trials for non-small cell lung cancer (NSCLC) and metastatic castrate-resistant prostate cancer (mCRPC).

    BIND`s programs and pipeline

    (click to enlarge)

    Collaboration Agreements

    BIND is collaborating with leading pharmaceutical partners (Amgen, Pfizer, and AstraZeneca) to develop Accurins™ in line with each of their prospective products. The company stands to receive up to a total of $1 billion in upfront and milestone payments, including $450 million in pre-commercial payments. BIND expects that at least one of these collaborations will advance into the clinical Phase I by the end of 2014. Below are the specifics for each of the collaborations and their potential.

    AstraZeneca

    In April 2013 BIND and AstraZeneca (NYSE:AZN) entered into a strategic collaboration to develop and commercialize an Accurins™. At the Jefferies 2014 Global Healthcare Conference oral presentation Mr. Scott Minick, BIND's President and CEO, stated that the results show enhanced efficacy and increased tolerability. According to the results, the Accurins™ with Aurora B kinase inhibitor, showed reduce toxicity and increase efficacy as compared to AstraZeneca's parent drug. Importantly, it was able to significantly reduce the severe bone marrow toxicity seen in this entire class of drugs to a level similar to untreated controls. Under the agreement, AstraZeneca is required to pay for all of BIND`s development costs. BIND was paid $4 million upfront and has the potential to receive contingent future payments totaling up to $193 millions upon AstraZeneca`s achievement of specified clinical, regulatory and commercial events, as well as tiered royalties in the low-single digit to the low-double digit percentages of aggregate worldwide net sales of licensed product.

    (click to enlarge)Aurora Kinase results

    Amgen

    In January 2013 BIND and Amgen (NASDAQ:AMGN) established the first major partnership focusing on the development of a novel and targeted kinase inhibitor nanomedicine. Kinase inhibitor in Accurin™ has the potential to treat cancer more efficiently. BIND granted Amgen an option to obtain an exclusive worldwide license to develop, manufacture and commercialize an Accurins™ that incorporates a specified Amgen kinase inhibitor for all uses except for some vaccine applications. On December 12th, 2013 BIND announced that it has amended its development and commercialization collaboration agreement with Amgen Inc. to extend the period during which Amgen may exercise its option by six months. The additional period under the amended collaboration agreement was extended to July 7, 2014 in order to allow for completion of the research plan. BIND has already received $5 millions upfront. BIND is eligible to receive upfront development milestone payments totaling $46.5 millions, up to an additional $134 millions in regulatory and sales milestone payments for the first therapeutic indication and additional payments for target exclusivity. In addition, BIND will receive tiered royalties on potential future sales.

    Why I believe Amgen will exercise its option:

    At the Jefferies 2014 Global Healthcare Conference an interesting result was presented: The use of an inhibitor of the phosphoinositol-3-kinase (PI3K) pathway, which is part of Amgen`s development, in conjunction with the Accurin™ led to a reduction in the toxicity. PI3K is the hottest inhibitor in cancer research to date. It plays a crucial rule in the cancer development; therefore, inhibiting this pathway already achieved great results. The only problem with these inhibitors is their toxicity. BIND-014 shows promising results in reducing the toxicity, thus becoming an important player in this field. In addition, Amgen waited to a proof of concept that the kinase inhibitor with the Accurin™ can reduce toxicity and increase efficacy relative to the parent drug. Taking AstraZeneca results and the new Amgen result, I think that Amgen will not let this development slip from their fingers; therefore, they have time until July 7 to close the deal.

    (click to enlarge)Accurin Kinase inhibitor results

    Pfizer

    In March 2013 BIND and Pfizer (NYSE:PFE) entered into a global collaborative agreement to develop and commercialize Accurins™ utilizing selected small-molecule targeted therapies. BIND granted Pfizer a 30-month option to exclusively license Accurin™ for all potential indications other than vaccines and brain cancer. Under the agreement, Pfizer is required to pay for all of BIND`s development costs. BIND received an upfront payment of $4.0 millions and may potentially receive contingent payments totaling up to $89.5 millions in clinical and regulatory milestones, plus additional contingent payments totaling up to $110 millions in specified commercial milestone payments. BIND will also receive royalties in the low-single digit to the high-single digit percentages of aggregate worldwide net sales of any licensed product. This would also represent a substantial cash influx into BIND.

    Update on BIND-014

    BIND-014 is a prostate specific membrane antigen with PSMA targeting Accurin™ that contains docetaxel, one of the most widely used cancer chemotherapy agents. PSMA is a cell surface protein expressed on prostate cancer cells and the abnormal blood vessels surrounding many types of non-prostate solid tumors, including non-small cell lung cancer. BIND-014 is currently in Phase II clinical development for second line non-small cell lung cancer in chemotherapy naïve metastatic castrate resistant prostate cancer. BIND expects to report the top line data on this trial, as well as Phase II trial in chemotherapy naïve metastatic castrate resistant prostate cancer in the second half of this year.

    At the AACR 2014 Annual Meeting and in the Jefferies 2014 Global Healthcare Conference oral presentation, BIND presented new data supporting its technology. In a poster presentation entitled "A phase I study of BIND-014, a PSMA-targeted nanoparticle containing docetaxel, administered to patients with refractory solid tumors on a weekly schedule," phase I data were demonstrated on safety, pharmacokinetics and preliminary efficacy of BIND-014 administered as a 60-minute infusion once weekly for three weeks (Q1W), followed by one week without treatment over a four-week cycle. Greater dose intensity by approximately 50% was shown with Q1W dosing of BIND-014 as compared to once every three week dosing. Different tolerability profiles were demonstrated with BIND-014 dosed at Q3W and Q1W. The Q1W schedule demonstrated considerably less neutropenia than Q3W BIND-014, a major dose-limiting toxicity for docetaxel, even at the higher dose intensity. Pharmacokinetics of BIND-014 was consistent with prolonged retention of BIND-014 particles in the vascular compartment and controlled release of docetaxel at the tumor. The results also showed preliminary signals of antitumor activity on the Q1W schedule. These results show that BIND-014 delivers the payload to the cancer.

    In another poster presentation at the AACR 2014 Annual Meeting, entitled "Prostate-specific membrane antigen (PSMA) expression as a potential patient selection marker in patients with refractory solid tumors administered BIND-014, a PSMA-targeted nanoparticle containing docetaxel" it was shown that the PSMA expression in patients responds to the treatment with BIND-014 in the phase I clinical study. A positive PSMA expression of moderate or high intensity was observed in patients who demonstrated a response to BIND-014 in the phase I study. Preferential expression of PSMA was observed on prostate cancer cells and vasculature of non-prostate solid tumors, but not in normal (non-cancerous) vasculature. PSMA expression levels will be evaluated in the tumors of patients enrolled in phase II clinical studies with BIND-014 to investigate the correlation between expression and efficacy as a potential basis for patient selection.

    Looking at the results so far, and looking at other delivery programs of different companies (for example; CytRx Corporation (NASDAQ:CYTR)), I estimate a 70% chance for these phase II to achieve its end point.

    Promising activity in NSCLC patients with KRAS mutant tumors

    The KRAS (V-Ki-ras2 Kirsten rat sarcoma viral oncogene homolog) gene is involved in regulating cell division and belongs to a class of genes known as oncogenes, which when mutated, have the potential to cause normal cells to become cancerous. The Non-small cell lung cancer patients with KRAS mutations have high unmet need with lack of approved therapy and a poor prognosis. These patient populations typically do not respond to docetaxel treatment. As to the ongoing NSCLC phase II trial, in the Jefferies 2014 Global Healthcare Conference oral presentation it was shown that in KRAS mutant of NSCLC had a partial response, as good as 60% change in targeted lesions from baseline. These results led to the preparation of a 20 patients with KRAS mutations phase II trial that will start in early Q3 2014. This data is encouraging given the lack of approved therapeutics in this population and the apparent differentiation from conventional docetaxel.

    BIND also plans to start in Q4 another trial in four tumor types, cervical, bladder, cholangio and neuroendocrine cancer. These trials will enroll approximately 25 patients in each tumor type to evaluate efficacy. There is a significant unmet medical need in each of these tumor types and three of them represent a potential opportunity for accelerated approval due to unmet medical needs and available approved therapies.

    Company Financial Position

    The cash equivalents and marketable securities were $68.7 millions as of March 31st, 2014. Net loss for the first quarter of 2014 was $8.3 millions. According to these financial data, BIND has enough cash to fund operations through 2015, even without any additional contributed amount from Amgen, Pfizer or AstraZeneca, which is always a great advantage and a strong financial position for a developmental biotechnology company.

    Risks

    There is no investment without a risk attached to it: The main risk is that the expected results forecasts might not be met. Nevertheless, there is no success without taking chances. Another possible risk facing investors is a dilution concern. Yet, I do not expect to see a dilution until 2015 and if Amgen and Pfizer decide to exercise their options bind will get a substantial cash of money and will not have to make dilution in the very near future.

    Summary and conclusion

    Current fundamentals indicators, demonstrate that BIND could potentially become the next promising and unique company in the oncology field. The new data given in number of conferences further show that Accurins™ is an efficient and safe delivery system. Investors should look towards the decision of Amgen and/or Pfizer to exercise their option with BIND. Time is closing in as Amgen has until July 7, 2014 to make its move and decide. Due to new results, who were brought in this article, I believe that there is an excellent chance that Amgen will exercise their option with BIND. If Amgen exercises its option, BIND is eligible to receive upfront development milestone payments totaling $46.5 millions and additional $134 millions in regulatory and sales milestone payments.

    Investors should also look towards rapid advancement of BIND's leading drug candidate, BIND-014, in Phase II clinical trials for non-small-cell lung cancer (NSCLC) and metastatic castrate-resistant prostate cancer (mCRPC) with topline data in the second half of this year. I estimate a 70% chance of success in the two phases II trials in NSCLC and prostate cancer. I base my opinion on my research of companies with delivery systems. Next on the horizon for BIND in 2014 is the initiation of a single arm open label 20 patient trials in non-small cell lung cancer patients with KRAS mutations, which should begin enrolling patients in early Q3 and additional tumor types in which there is strong biologic rationale for BIND-014 treatment including cervical, bladder, cholangio and neuroendocrine cancer in Q4.

    I believe that BIND is undervalued at its present market capitalization of around $135 million and with approximately $68 million in cash. Analyst covering BIND gave price target between 20$ - 30$:

    Stifel Nicolaus - 20$ target price.

    BIND)+at+Outperform/8776012.html" target="_blank" rel="nofollow">Cowen & Co. - 30$ target price.

    JMP Securities - 30$ target price.

    Credit Suisse - 21$ target price.

    I reaffirm my estimated price target of $20 excluding Amgen`s or Pfizer`s potential to exercise their options. This price target is based on the assumption that the phase II trials will be successful. In case Amgen and Pfizer decide to exercise their options, the likelihood of BIND to triple its value and reach a price target of $30 by the end of 2014 is highly plausible, since BIND stands to receive up to a total of $1 billion in upfront and milestone.

    Disclosure: I am long BIND. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Jun 09 12:22 PM | Link | Comment!
  • BioLineRx: Extremely Undervalued Company With Multiple Catalysts In 201

    BioLineRx (NASDAQ:BLRX) is a clinical stage biopharmaceutical development company dedicated to identifying, in-licensing and developing therapeutic candidates that have advantages over currently available therapies or that address unmet medical needs. BioLineRx's pipeline is developed usually through Phase II proof of concept in humans, afterwards the company partners with medium size and large pharmaceutical companies to complete the clinical development and bring the product to the market.

    As described in the table below, BioLineRx's pipeline currently consists of seven clinical stage therapeutic candidates with several potential blockbuster products. BioLineRx has one of the most catalyst-rich programs in 2014 of any small-cap biopharmaceutical company with top line results in Acute Myocardial Infarction (AMI), Acute Myeloid leukemia (AML), Celiac Disease, Hepatitis C Virus (HCV), Stem Cell Mobilization and Skin Lesions. In this review I present BioLineRx's rich and diverse pipeline and argue why BioLineRx is extremely undervalued and could be a huge winner in 2014.

    (click to enlarge)BioLineRx

    BioLineRx's pipeline currently consists of seven clinical stage therapeutic candidates:

    BL-1040

    This technology represents a unique approach to supporting cardiac tissue damaged as a result of ischemia. This agent is administered as a liquid via intra-coronary injection, which, upon contact with damaged cardiac tissue, transforms into a gel. This gel provides mechanical support allowing the damaged tissue to heal as a more compact, less dilated and "tighter" scar, which results in improved long-term cardiac function. The gel is later absorbed naturally and is excreted from the body within six weeks. Safety and biocompatibility studies revealed no evidence of local or systemic toxicity at equivalent, and significant, multiples of the anticipated human dosage. The results of these studies show that BL-1040, administered at up to 7 days post acute myocardial infarction (AMI), improves survival, prevents the dilation of left ventricular end systolic and diastolic volume, prevents fractional shortening deterioration and improves mitral regurgitation. The treatment also minimizes the systolic wall thinning, a finding consistent with the prevention of progressive infarct expansion.

    BL-1040 was out-licensed in July 2009 to Ikaria Inc. for continuation of development and commercialization (under the name IK-5001). Total deal structure $282.5 million; $17 million already received; 11-15% royalties. All program costs are funded by Ikaria. Ikaria recently announced the sale of commercial operations to Madison Dearborn and the spinoff of R&D operations (including BL-1040) into a separate entity, showing the confidence in this program.

    BioLineRx has completed a phase I/II pilot clinical trial designed to assess the safety and feasibility of BL-1040 in patients who have experienced a significant AMI. An Independent Safety Monitoring Board (ISMB) reviewed the data from the study and concluded that the treatment is safe and clinical development of the agent may continue.

    BL-1040's first pivotal trial, examining safety and efficacy, is expected to be completed this year. This trial aims to evaluate the safety and effectiveness of BL-1040 in the prevention of ventricular remodeling and congestive heart failure when administered following AMI. The trial is a placebo-controlled, double-blind trial including approximately 306 patients who will be treated with BL-1040 following AMI and will then be monitored for six months. Endpoints: End diastolic volume, QLQ, six-minute walk test. BL-1040 is being developed as a class III medical device under the FDA's pre marketing approval, or PMA, regulatory pathway. The company CFO and COO, Mr. Philip Serlin says: "We believe BL-1040 represents an annual market opportunity of $1-billion." The results are expected in H2 2014.

    BL-8020

    BL-8020, an orally available, interferon-free treatment for Hepatitis C (HCV). BL-8020 is a potent antiviral composition which acts synergistically when combined with other HCV inhibitors. BL-8020 acts via a unique mode of action, inhibition of HCV-induced autophagy. This approach differs from the mode of action of current anti-HCV agents and therefore substantially improves their effect in the treatment of HVC infection. BL-8020 is currently in a Phase I/II clinical trial. The study is an open-label trial to evaluate the efficacy, safety and tolerability of BL-8020 in patients infected with HCV.

    The HCV market represents a vast commercial opportunity for BioLineRx. As per data from a 2011 report from Decision Resources, approximately 180 million people are suffering from chronic HCV globally. The global HCV market is expected to be worth $20 billion by 2020 as opposed to $6 billion in 2011. BL-8020 is being developed by BioLineRx Ltd. under a worldwide exclusive license agreement with Genoscience. In January 2014, BioLineRx agreed with the licensor's, Genoscience and Panmed Inc., or Panmed, that as of April 1, 2014, the license agreement would be terminated and that BioLineRx would enter into a collaboration agreement. Pursuant to the collaboration agreement, the licensors agreed to take over development of the drug and pay BioLineRx a percentage of future revenues from the product, and BioLineRx agreed to supply, at the licensors' request and cost, the drug needed for a clinical trial to be administered by the licensor's. In the near future Genoscience and Panmed will be deciding on the direction of the current phase 1/2 study and will assess potential additional indications. Top line partial results are expected until the end of Q1 2014 and the full results during H2 2014.

    BL-8040

    BL-8040 is a short peptide that functions as a high-affinity antagonist of CXCR4, a chemokine receptor that is directly involved in tumor progression, angiogenesis, metastasis, and cell survival. CXCR4 is over-expressed in more than 70% of human cancers and its expression often correlates with disease severity. BL-8040 binds to CXCR4 on tumor cells and blocks its availability to the ligand CXCL12; this binding leads to apoptosis (programmed cell death) or release of the tumor cells from the protective microenvironment of the bone marrow, thus exposing the cells to chemo anti-cancer therapy.

    BL-8040 is undergoing a Phase II multicenter, open-label study under an IND, designed to evaluate the safety and efficacy profile of repeated escalating doses of BL-8040 in adult subjects with relapsed or refractory acute myeloid leukemia (AML). Up to 50 patients are expected to be enrolled in the study, which is expected to be conducted at eight sites in the U.S. and Israel. The primary endpoints of the study are the safety and tolerability of BL-8040. The study is also designed in a way that will enable the investigators to evaluate the capabilities of BL-8040 in mobilizing cancer cells from the bone marrow to the peripheral blood, and in inducing their cell death. Initial results from the Phase II clinical trial for patients with relapsed or refractory AML show that BL-8040, in combination with high-dose Cytarabine (Ara-C), is safe at all doses tested to date, and triggers substantial mobilization of cancer cells from the bone marrow to the peripheral blood. Also, BL-8040 causes robust apoptosis of cancer cells that were observed following administration of the higher doses. The U.S. Food & Drug Administration (FDA) has granted an Orphan Drug Designation to BL-8040 as a therapeutic for the treatment of AML.

    (click to enlarge)BL-8040 way of action

    BioLineRx plans to commence a Phase I trial for BL-8040, for the mobilization of stem cells from the bone marrow to the peripheral blood circulation. Also, BioLineRx recently enhanced the acceptance of a notice from the FDA confirming an Orphan Drug Designation of BL-8040 as a treatment for stem cell mobilization, in addition to the Orphan Drug Designation previously granted to BL-8040 as a treatment for AML. It is not so common to have two orphan drug designations for one drug.

    BL-5010

    BL-5010 is a novel aqueous formulation composed of approved components for the non-surgical removal of benign and pre-cancerous skin lesions, such as seborrheic keratosis (SK) and actinic keratosis (AK). This treatment offers an alternative to painful, invasive and expensive removal treatments including surgery, cryotherapy and laser treatment. The formulation is applied topically to the lesion for a few seconds and causes it to gradually dry out and fall off within one to four weeks. BL-5010P is a disposable, non-invasive, pen-like applicator containing the BL-5010 solution which aims to increase the safety and accuracy of the treatment. Both BL-5010 and BL-5010P have received approval in Europe for the regulatory pathway classification as a Class IIa medical device. A Phase 1/2 pilot study, performed on 60 patients with SK, demonstrated that a single topical application of BL-5010 was effective in 96.7% of the cases for removal of the target lesion within 30 days.

    BioLineRx has received approval from the German Federal Institute for Drugs and Medical Devices (BfArM) and the Ethical Committee in Germany to commence a pivotal, CE Mark registration trial for BL-5010P (State-of-the-art applicator). BioLineRx pivotal multi-center study is a single-arm, open-label, bridging study of BL-5010P. This study will aim to re-confirm the efficacy, safety and tolerability observed in the earlier clinical study using the BL-5010P applicator in patients with SK. Twenty patients at up to three leading sites in Germany will be enrolled. The primary study endpoint is the complete lesion removal rate at Days 30, 90 and 180 after treatment.

    According to a work done by Edison, the expected net sales are between 50-70M$, while the market was estimated to be 0.5B$. This trial is planned to commence in H1 2014. Study results are expected during H2 2014.

    BL-7040

    BL-7040 is an orally available, synthetic oligonucleotide with unique dual activity, being developed for the treatment of inflammatory bowel disease (IBD). It has a specific agonist effect on a receptor involved in the immune system and inflammatory reactions called Toll-Like Receptor 9 (TLR-9). It also acts as a specific suppressor of acetylcholinesterase, a key enzyme involved in neurological pathways. BL-7040 has an indirect effect on the production of pro-inflammatory cytokines as well as anti-inflammatory properties via modulation of macrophages.

    BL-7040 was found to be safe and effective in treating ulcerative colitis, a form of IBD, in a Phase IIa study. The Phase IIa trial was an open-label trial to evaluate the efficacy, pharmacodynamics, safety and tolerability of the drug in patients with moderately active ulcerative colitis. These results were summarized by Dr. Kinneret Savitsky, Chief Executive Officer of BioLineRx: "Ulcerative colitis and Crohn's disease are prevalent conditions that affect the quality of life of millions across the globe. It is estimated that as many as 1.4 million individuals in the U.S. suffer from these diseases. In addition to discomfort, which can be quite extreme, IBD can cause significant complications, including anemia, intestinal abscesses, intestinal perforation and more. Current treatments are far from satisfactory, and many people stand to benefit from a new and effective treatment." Furthermore, IBD has few specific treatment options available. Sales of existing drugs are estimated at $1.8 billion annually; however, current treatment options do not fully address the patients' needs.

    BL-7010
    BL-7010 is a novel, high molecular weight, non-absorbable, orally available polymer intended for the treatment of celiac disease. It has a high affinity for gliadins, the immunogenic proteins present in gluten that cause celiac disease. By sequestering gliadins, BL-7010 effectively masks them from enzymatic degradation and prevents the formation of immunogenic peptides that trigger the immune system. BL-7010 is excreted with gliadin from the digestive tract, preventing the absorption of gliadin into the blood.

    This designation has a target market estimated by $8 billion. Approximately 1% of the world's population suffers from celiac disease. The number is underestimated due to lack of awareness/diagnostic tools. There are no current pharmacological agents approved for celiac. The only treatment option is life-long, strict gluten-free diet (GFD). Two studies in celiac disease patients are planned in 2014:

    1. Phase I/II study in celiac patients (ongoing). It is a single and repeated ascending dose study. Safety endpoints, no efficacy endpoints assessment of systemic exposure and Top-line results expected in mid-2014

    2. Efficacy study in celiac patients. Including 6-week repeated oral administration. The results will include efficacy endpoints (primary and secondary) and safety endpoints.

    Pre-clinical programs include BL-8030, BL-9010, BL-9020.

    1. BL-8030 is a very potent and selective HCV NS3/4A inhibitor which has demonstrated a high genetic barrier to development of resistant variants. It is a second generation HCV NS3/4A inhibitor, has favorable in vitro characteristics including potency, selectivity, activity against resistant mutants, reduced P450 enzyme inhibition and a wide therapeutic index. BL-8030 has been out-licensed to Jiangsu Chia-tai Tianqing Pharmaceutical Co., Ltd. (CTTQ), the leading Chinese pharmaceutical company in the liver disease therapeutic area, for the development and commercialization exclusively in China and Hong Kong. BioLineRx retains the right to develop and commercialize BL-8030 in other parts of the world.

    2. BL-9010 (previously called EDP-14) is a novel bispecific antibody treatment for severe and persistent asthma that targets and links together two immunological modulators IgE and CD300a. BioLineRx deffined this antibody as a first-in-class inhibitor of mast cell degranulation. Mast cells are major modulators of allergy in response to allergen stimulation of IgE. BL-9010 targets this effect by down-regulating IgE activation with the aid of the inhibitory CD300a molecule.

    3. BL-9020 is a novel antibody treatment for prevention of the development of Type 1 diabetes. It was developed to treat Type 1 diabetes in early stage patients, during what is known as the "honeymoon period.". The insulin-producing pancreatic cells are not completely destroyed at this stage, and BL-9020 can preserve surviving cells, thus preventing full maturation of the disease. BL-9020 is an inhibitor of the Natural Killer (NK) receptor NKp46. It was shown that NKp46 specifically recognizes pancreatic beta cells, leading to their destruction. Thus, supporting anti-NKp46 monoclonal antibodies can be seen as a new treatment modality for Type 1 diabetes. In January 2014 BioLineRx enhanced an agreement with JHL Biotech to collaborate in the development and commercialization of BL-9020.

    BioLineRx Financial Position:

    BioLineRx ended their third quarter with approximately $20.3 million in available cash. On March 7th, 2014 BioLineRx announced the closing of Public Offering for gross proceeds of approximately $24.1 million. According to this financial data, BioLineRx has approximately $44.4 million in available cash, not including the money the company has spent between September and now. BioLineRx`s annual burn rate is only ~$12 million, therefore the company has more than enough cash to fund operations through 2017 which is always a great advantage for a developmental biotechnology company.

    2014 Major Milestones:

    · BL-9020 (Type 1 Diabetes) collaboration with JHL

    · BL-8040 (AML) phase 2 partial results- Q2 2014

    · BL-5010 (Skin Lesions) pivotal EU study initiation- H1 2014

    · BL-8020 (HCV) phase 1/2 partial results- H1 2014

    · BL-8040 (Stem Cell Mobilization) phase 1 initiation- H1 2014

    · BL-7010 (Celiac Disease) phase 1/2 top line results- MID 2014

    · BL-5010 (Skin Lesions) pivotal EU study results- H2 2014

    · BL-8020 (HCV) phase 1/2 topline results- H2 2014

    · BL-8040 (Stem Cell Mobilization) phase 1 results- H2 2014

    · BL-1040 (AMI) pivotal CE mark study results- H2 2014

    · BL-8040 (AML) phase 2 topline results- H2 2014

    Analyst coverage of BioLineRx

    BioLineRx Ltd. is followed by the analysts; Edison at 9 December 2013, valued BioLineRx at $210m ahead of key catalysts, equivalent to $8.9/ADR (basic) or $7.9/ADR (fully diluted). BLRX)+at+Buy%3B+BL-8040+Bivalent+Action+Appearing/8981066.html" target="_blank" rel="nofollow">Aegis Capital at December 2013 had a $7 price target. ROTH Capital Partners had a $5 in October.

    Summary and Conclusion:

    With market capitalization of only $80 million and more than ~$40 million in cash, BioLineRx's entire pipeline is valued by the market at only ~$40m. As such I see BioLineRx as an extremely undervalued company, presenting a great investment opportunity for the short and the long term. Positive data from any of the Multiple Near-Term Clinical Catalysts in 2014 could substantially increase the firm's valuation. In addition, after its recent successful financing the company has a very strong balance sheet with no current financial constrains for the next three years. This will also help the company in any future negotiations for a buyout or partnership.

    My short term catalyst trade target opinion is around 4$, with a one year target opinion of 7$-9$ a share, or roughly 350M$, based on positive results from only several indications from the trials in Acute Myocardial Infarction (AMI), Acute Myeloid leukemia (AML), Celiac Disease, Hepatitis C Virus (HCV), Stem Cell Mobilization and Skin Lesions.

    Disclosure: I am long BLRX. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Tags: BLRX, long-ideas
    Mar 27 1:37 PM | Link | 6 Comments
  • Behind The Short, Are Investors Of CytRx That Shallow?

    I read Richard Pearson`s article on Seeking Alpha (NYSE:SA) and felt confused. I didn't read all the articles on SA addressing CytRx corporation (NASDAQ:CYTR), rather, I was reading about CytRx`s technology the company`s results, and all Richard Pearson said was that he thinks CytRx misled investors. Well, I think it is Richard Pearson who misled investors and not for the first time. I argue that the short position was taken three days before the publication, thus using SA as an "insider information" source promoting his position and his friends. As a PhD in biochemistry I am arguing that CytRx is undervalued with respect to its technology and pipeline of cancer treatment development. To the best of my knowledge the phases II results were nothing less then excellent, and, based on the recent approval for phase III, the FDA appears to agree with me.

    I would like to address Richard Pearson, starting from his statement in his article in SA "Behind The Scenes With Dream Team, CytRx And Galena". He stated: "My goal in submitting dummy articles to DTG was to determine the level of involvement of management of these companies in reviewing and editing articles." This is funny since I found a nice article about CytRx and GALE. This article was published in "The Street", relating to three companies: "3 Oncology Biotechs to Watch". In this article Richard Pearson wrote: "CytRx's approach to oncology is noteworthy to CytRx bulls because it potentially could entail lower risk. Not only is CytRx's aldoxorubicin essentially just an improved delivery mechanism for an existing chemotherapy drug, but this delivery mechanism itself has been proven by Abraxane, which also combined an existing chemotherapy drug with an albumin binding molecule. The drug is currently in a phase III trial for second line treatment of soft tissue sarcoma and a phase IIB trial as a second line treatment for glioblastoma multiforme." This is an extremely bullish approach, maybe even a pump article by Richard Pearson. As you can see, Richard Pearson has written very positive things about CytRx's drug and now he writes "Readers should keep in mind that drugs do not "pass" Phase 2 trials. It is the decision of the sponsor (ie. CytRx) whether or not to proceed to Phase 3. The FDA would certainly halt a study if it was deemed to be dangerous to the patients enrolled. But the FDA would not otherwise rule on effectiveness or stop a trial at Phase 2." Now I'm confused, on January 27th, 2014, as shown above, Richard Pearson stated that "the drug is currently in a phase III trial", so what is true and what is a lie? Well, in order to answer this question, I need to write about CytRx's platform.

    Aldoxorubicin is a tumor-targeted doxorubicin conjugate. This means doxorubicin is attached to an acid sensitive linker (EMCH). After administration Aldoxorubicin rapidly binds endogenous circulating albumin through the EMCH linker. The albumin delivers the drug via blood circulation to the tumor where it is released due to the tumor`s acidic environment(the linker is acid sensitive). This mechanism results in free doxorubicin at the site of the tumor. To make it simple, imagine a guided missile aiming tumors.

    Now back to Richard Pearson, and also addressing Adam Feuerstein: They claimed that the results are not conclusive and Pearson also stated in his article: " Feuerstein also notes that more than 60% of the patients enrolled in CytRx's aldox study were in India, Romania, Russia and Ukraine, implying that accuracy may not be as high as for a study which had been done primarily in the US and/or Western Europe". Well, they are saying that you can only conduct a trial in the USA. However, many of the known drugs were developed outside of USA. Are these drugs judged on where they were developed? Also, "For some reason patients in this trial had a 0% response rate for tumor shrinkage with the legacy drug doxorubicin. This is unusual in that dox is considered the standard treatment for sarcoma patients. A 0% response in this control arm provided a very strong (apparent) boost for CytRx's aldox." They mean to say that the results are fabricated. So let's have a look at the results: "Additional analysis determined hazard ratios for the primary endpoint of progression-free survival (NYSE:PFS) by both investigators at study sites and by a blinded radiology review performed at an independent central laboratory. The hazard ratio for investigator-read scans is 0.37 (95% confidence interval, range of 0.212 to 0.643) (p=0.0004), reflecting a 63% reduction in the risk of disease progression; and the hazard ratio for central lab scans is 0.59 (95% confidence interval, range of 0.36 to 0.96) (p=0.034), reflecting a 41% reduction in the risk of disease progression." I looked at the statistics and at the conclusions of the investigators and I am also taking into account the doctor and the FDA that checked the results. Do they all have less knowledge then Adam Feuerstein or Richard Pearson? The FDA`s recommendation was to approve "dosing patients with aldoxorubicin until disease progression in a planned pivotal, global Phase 3 clinical trial with aldoxorubicin as a second-line treatment for soft tissue sarcomas." The FDA based the approval on the success of the trial. They approved high doses of aldoxorubicin!!! Well, I think the FDA has more qualified employers then Adam Feuerstein or Richard Pearson.

    Richard Pearson`s allegations a regarding the electronic signature seem unpersuasive as it is easy to manipulate such signatures. This is not a proof, not even close. I didn't see any of the management selling their stock. The stock actually rose after the good result and the beginning of other trials. It's a nice story, but Richard Pearson has a position to sell, so he tells a "007 story" without a smoking gun. I hope the company will reply to this week`s allegations with a lawsuit.

    Is CytRx the only one? According to the article there is more than one or two, so why CytRx. Looking at Richard Pearson`s articles, most of them are short and match his position. Let us look at the article about Kandi Technologies Group Inc (NASDAQ:KNDI). Richard Pearson gave this stock a 4$ target, while, today, the stock is around 17$. Look at the same method, first he is long as he stated :"My last article was long, but the key points can be summarized as follows" but he has the same point for short: " Aggressive articles predicting a meteoric rise in the stock". Looking at this misleading article and others, I don't really understand SA approving his last article.

    Let's look ahead, CytRx has approximately 125M$. The market capitulation is around 225M. Therefore, the entire company pipeline is valued by 100M. I won`t go and value CytRx, I just state what Aegis recommended and published (January 23rd 2014) few days before Richard Pearson (January 27th 2014): "Aegis increased their price objective on shares of CytRx (NASDAQ:CYTR) from $9.00 to $12.00 in a research note issued on Thursday, American Banking & Market News reports. The firm currently has a "buy" rating on the stock. Aegis's target price suggests a potential upside of 66.20% from the company's current price." At that time, CytRx had a market cap of $297.1 million. If we take this recommendation to date, CytRx has 200% upside. I believe the potential is even higher.

    Disclosure: I am long CYTR.

    Tags: CYTR
    Mar 14 3:02 PM | Link | 21 Comments
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