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The enormous advancement in the biological sciences that is taking place has begun to change the traditional way of practicing medicine. Far-reaching biological products are being approved and news about breakthroughs are occupying the media headlines. However, selecting the biotechnology firms... More
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  • Will LPATH (LPTN.OB) Reap the Fruits Of Its Acknowledged Efforts
          An early enthusiasm for Lpath science, technology and breakthrough treatments still in preclinical development at the time, has led to investors’ disappointment. LPTN.OB, which has descended to the penny stock zone, might be predestined for a comeback and even more. Lpath scientists were among few who recognized that bioactive lipid signaling molecules such as sphingosine-1-phosphate (S1P) and lysophosphatidic acid (LPA) were valid targets for therapeutics of cancer and other diseases. The firm did not stop at the discovery, but went further into developing proprietary processes, know-how, and assays, which enabled studying and analyzing the characteristics of the challenging lipid molecules and their effects. Consequently, the firm used its proprietary ImmuneY2™ drug-discovery engine to create what to our knowledge are the first therapeutic molecules (in this case antibodies) against the chosen bioactive lipid targets.  

         What brought this firm in mind were two press releases posted by the firm on Tuesday March 30.  In the first, Lpath announced positive results of phase 1 clinical trial of its drug ASONEP™ in a wide variety of solid tumors. In the second it demonstrated and explained its dissatisfaction with, and rejection of the decision by its exclusive worldwide licensee of ASONEP™, Merck KGaA (Germany), to extend its license agreement. The news about phase 1 trial Asonep™ informed that the trial has met its primary endpoint of identifying safe dose. The monoclonal antibody drug was well tolerated at all the dose-levels from 1 mg/kg to 24 mg/kg. These results erased doubts about safety evaluating Asonep as a single agent or overlapping toxicity when used in combination with standard therapies. With regard to the drug’s efficacy, the results demonstrate that more than half the patients who completed the initial four-treatment evaluation period showed stable disease, which has been durable in several cases. Important also was the finding that the lymphocyte counts in the vascular space were reduced in a drug dose-related fashion. These results have achieved an objective established by the licensee Merck KGaA (Darmstadt, Germany), which led to a $2 million payment.

          Lpath views these results as validating its drug Asonep™, its bioactive signaling lipid target and its ImmuneY2™ drug-discovery engine.  Lpath viewed them as adding a huge increase in the drug value, which led to reject Merck KGaA’s proposal to continue its partnership in Asonep™ program with the same financial terms, which is now viewed as not in its best interest or the best interest of its shareholders. As a result, Merck KGaA notified Lpath that it will terminate the License Agreement effective April 24, 2010 and return the rights to the cancer drug Asopnep’s program to Elpath. What’s next? First, Lpath promised its shareholders to aggressively seek to re-partner Asopnep™, but with a much favorable deal. Its compelling argument include: First, the strong efficacy signals from Asonep’s preclinical studies in animal models, which involved renal cell carcinoma, prostate cancer, neuroblastoma, ovarian cancer and lung cancer. Second, the successful completion of phase 1 clinical trial that was announced on Tuesday, which offered evidence of biological and therapeutic activity of the drug on human cancer patients.

    Some Background About the Drug Target

         To begin with, besides Lpath’s drug, Asonep, no therapeutics exist that that target bioactive signaling lipids for treating human diseases. Validating the firm’s program is the current scientists’ acknowledgement of the fact that changes in lipid metabolism can cause cancers, heart disease, vascular diseases, diabetes, neurodegenerative disorders, immune diseases, pain, mental disorders, eye disorders, and inflammatory diseases. They insinuated that bioactive lipid signaling molecules would make good therapeutic targets.
         It was easy to say it, but not really easy to identify these targets, analyze them and develop drugs that target them. These lipids are minute in size and are not water-soluble, making them extremely hard to understand. Also, the tools usually used to analyze proteins do not work for lipids.
         Using the processes it developed over a substantial amount of time, and its proprietary ImmuneY2™ drug-discovery engine technology, Lpath was capable of breaking the barriers, identifying valid targets for therapeutics: Sphingosine-1-phosphate (S1P) and another one, lysophosphatidic acid (LPA), and develop drugs to target them.    

    Sphingosine-1-phosphate (S1P) - a bioactive lipid (a key component of the sphingolipid signaling cascade) acts on a complement of five G-protein Coupled Receptors (GPCRs) to promote cell proliferation, migration, and protection from cell death (apoptosis) – all are characteristics of cancer. S1P has many actions, possibly causing many diseases, including inflammation, pathogenic fibrosis, and cancer. S1P is, in fact, a pleiotropic tumorigenic growth factor that promotes tumor growth by stimulating cell proliferation and metastasis. Recent studies indicate that S1P promotes tumor angiogenesis. Importantly, sphingosine kinase (SPHK), the enzyme responsible for S1P production, is an oncogenic protein, further suggesting that S1P is a potential therapeutic target for cancer.

    Lpath Pipeline

    Asonep™:     (Systemic formulation of humanized Sphingomab™)

    Target:     Sphingosine 1 Phosphate (S1P)
    Indications:     Cancer, Inflammation
    Development:     Phase 1 Partnered with Merck-Serono

    isonep™:     (Ocular formulation of humanized Sphingomab™)

    Target:     Sphingosine 1 Phosphate (S1P)
    Indications:     AMD, Diabetic Retinopathy, Glaucoma, Others
    Development:     Phase 1


    Target:     Lysophosphatidic Acid (LPA)
    Indications:     Cancer, Fibrosis, Neuropathic Pain
    Development;  Late Preclinical


    Target:     (Other bioactive lipid targets)
    Indications:     Inflammation, Cancer, Asthma, Sepsis, Others
    Development:     In discovery

    Sphingomab™: This Lpath’s monoclonal anti-S1P antibody functions as a therapeutic molecular sponge to selectively absorb S1P, thus lowering the effective extracellular concentrations of this tumor-facilitating factor. The drug is expected1 to reduce tumor volume and metastatic potential as well as cause blockage of new blood vessel formation that feed cancers. Lpath also hypothesize that the drug would reverse the ability of S1P to protect cells from apoptosis.
         Lpath has developed murine and humanized monoclonal antibodies to S1P. The MAb is highly specific to S1P. It does not cross react with other structurally similar bioactive lipid mediators. Utilizing BIAcore technology, the affinity (Kd) of Sphingomab™ for S1P has proven to be much higher than most therapeutic antibodies, particularly other molecular sponges.

    1. The expectations are based on animal results where data have demonstrated compelling efficacy results. The drug has significantly reduced tumor volumes and weights in human models of lung cancer in mice, including ovarian, breast, lymphoma, myeloma, lung and melanoma cancers. It significantly reduced new blood vessel formation in mice cancer and significantly reduced circulating levels of the pro-angiogenic growth factors, VEGF, IL8, and IL6 in tumor mice. In cell culture, the ability of cancer cells to release these growth factors is reduced by Sphingomab™.  
     There is a lot of science, a lot of experimentations and a lot of hypothesis and good results. There are many promising results and promises by the company. There is a lot of effort spent, a lot of pain and a lot of patience. The concept is a breakthrough, as the targets are lipid instead of
    proteins like usual. The drugs are the outcome of the efforts and capability of solving the problem of understanding the lipid targets, which is a hard task. Lpath is one of the few, it not rare, penny stocks that are so serious, so scientific and so promising. We wish its efforts would become fruitful.  The odds for a successful outcome are mounting.   

    Disclosure: No Positions
    Mar 31 11:35 AM | Link | 1 Comment
    On September 22, Prohost wrote: 

    Hello future.
    It did not take us long to welcome the arrival of what many have expected from Sequenom and many have doubted. The expected has, indeed, begun to show, and the doubt that should disappear will stay as long as the skeptics of Wall street are ideologists whose ideology is cynicism. Nevertheless Sequenom has, indeed, launched its first laboratory test, SensiGene™ Cystic Fibrosis (NYSE:CF) Carrier Screening test. We went on to describe the carrier screening tests and stress the fact that healthy individuals with no family history of a genetic diseases and have healthy children, may still be carriers of a genetic disorder like cystic fibrosis. 

    The article proceeded into stating that the launch of this test marks the first test launched by its own lab, the Sequenom Center for Molecular Medicine. Read the article in Seeking Alpha  and the Prohost website.

    On October 8, 2009, Under the title: Who Sold Sequenom On Thursday August 6 and Why? Prohost wrote:

    Sequenom’s (NASDAQ:SQNM) recent stock decline looked as if a program was set for selling SQNM as soon as the financial results were announced. The point is that the firm’s financial results had nothing to do with SQNM price move, neither during the rally that took the stock up from a mid one-digit price to over $25, nor during the stock plummeting from around $15 in April to less than $4 overnight. So, it does not make sense that, all of a sudden, the financial results would have such a huge negative impact on the stock.
    The reason for the rally was investors’ enthusiasm about the firm’s non-invasive prenatal program, especially the expected launch of non-invasive test for Down syndrome. On the other hand, the reason for the stock losses that followed was the skepticism towards the program when news announced that some employees mishandled the R&D Down syndrome test data and results and were under investigation. This incident led investors to become skeptical towards the firm’s pre-natal program.

    The recent rebounding in the stock occurred as investors began to regain confidence that Sequenom will, indeed, be capable of putting several prenatal non-invasive tests on the market, including the Down syndrome test. This is what Sequenom has confirmed time and time again from the day the mishandling of the data was announced until now.

    Besides the prenatal program, recently, results from a study published by the University of Michigan demonstrate that thanks to using Sequenom MassARRAY system, its scientists were capable of detecting the presence of high-risk human papillomavirus (HPV) in women in nearly half (46.7%) of those who tested negative with the standard of care conventional test. HPV causes cervical cancer in women. As a matter of fact, around 9,000 American women are diagnosed with cervical cancer each year despite regular cervical screening with the current test. The results of the MassARRAY test will be published in the September 2009 edition of Journal of Virological Methods. The assay used in this study is exclusively licensed by Sequenom.  

    Sequenom, SEQureDx™, is a revolutionary approach to genetic screening. Rather than resorting to amniocentesis, i.e., entering the uterus to sample the amniotic fluid surrounding the baby, SEQureDx Technology extracts DNA material safely and comfortably from the blood of the mother. It is a simple process where SEQureDx™ utilizes circulating fetal DNA in pregnant women’s blood to examine the fetus’ genetic status. This effective screening does not entail the risks associated with disturbing the amniotic fluid that surrounds the baby in the uterus.

    In addition to Down syndrome, Sequenom’s SEQureDx Technology promises detecting a number of other genetic defects. An example is the analysis of fetal RhD. RhD disease that occurs when the blood of an expectant mother is incompatible with her unborn child. RhD incompatibility affects approximately one in one thousand live born infants and can lead to jaundice, anemia, brain damage, heart failure and death. Many other possibilities for Sequeom’s non-invasive tests are being studied.
    Sequenom’s technological capabilities and its revolutionary approach to genetic screening are the reasons for investors’ enthusiasm for the firm, not its current finances before it puts its tests on the market.  As a matter of fact, nothing in its most recent financial statement is so bad as to result in a sell off.

    We appreciate this firm’s technologies and believe its prenatal program will put breakthrough tests in the hands of physicians who badly need them.

    On June 10, 2009, Prohost wrote an article entitled Sequenom: Why have Short-sellers Panicked? In this article Prohost wrote:

    The Sequenom (SQNM) story is written now by short-sellers who are really not sure why they short this firm, except that it is their way of investing. The title we suggest for the short selling story is “gamble based on deadlines and rely on the plenty of gossipers who love bad news and perpetrate them."

    In the case of Sequenom, negative investors rely on the fact that the deadline indicated by Se-quenom to validate its Dawn syndrome's non-invasive diagnostic test is near year end. From now until that time, they will rely on making sure that hundreds of articles will be posted against the firm, its management and its Dawn syndrome test on the internet. They will make sure that nothing will be said about two other embryonic tests that are no less important than the Dawn syndrome non invasive diagnostic test. 

    To the bad luck of those who shorted Sequenom, the news that came this time  (true or false it does not matter) was positive for the company. The reaction of negative investors cannot be described except as reflecting panic. They rushed to protect their investment, buying the stock like crazy, hence causing the rally themselves. They are now selling at the higher price, taking profit, and shorting again.  Good for them. Read the rest of this article in

    In the Past Prohost Newsletter #298, under “URGENT” Prohost wrote:

    Crossing the Border of Skepticism


    This firm is speeding towards erasing two thirds of investors’ skepticism towards its technological capability. In the past month Sequenom launched SensiGene™ Fetal RHD Genotyping test, the firm’s first laboratory test powered by its SEQureDx™ technology. This launch was followed by the launch of the SensiGene™ Fetal(XY) (Fetal Sex Determination) test.  This test is the second laboratory developed test powered by its SEQureDx™ technology.SensiGene™ Fetal (XY) is non-invasive and safe. As the firm stated time and time again, it requires a simple blood sample from the mother. The test has proven to be highly specific.

    The test enables the distinction between maternal and fetal DNA for both male and female fetuses. It determines the fetus sex as early as the first semester of pregnancy.

    The SensiGene Fetal(XY) (Fetal Sex Determination) Test detects circulating cell-free fetal (ccff) DNA in maternal blood. The test interrogates male specific targets on the Y chromosome.  It is performed using Sequenom’s proprietary MassARRAY® system, which allows direct mass measurement of nucleic acids.

    Bringing two successive accurate non-invasive fetal tests in one month through the Sequenom’s SEQureDx™ technology should confirm the capability of the firm’s technology in making prenatal diagnostic tests, which was questioned following the mistake, or wrong handling of the Down syndrome test results by people in the firm’s R&D department. The tests have been rigorously evaluated through blinded studies, performed in collaboration with internationally recognized prenatal diagnosticians.  As with the SensiGene Fetal RHD Genotyping test, more than 500 clinical samples were tested during the course of feasibility, optimization, verification and validation.

    In the final blinded validation study, over 200 samples were evaluated. The test was performed in conjunction with the Fetal Medicine Foundation, and un-blinding was performed by Dr. Arnold Cohen, chairman of obstetrics and gynecology at the Albert Einstein Medical Center, in Philadelphia.

    In this validation study, the SensiGene Fetal Sex Determination test demonstrates:

    Sensitivity of  97.9% (92.5% – 99.4% at a 95% confidence interval).
    Specificity of 100%   (96.9% – 100%  at a 95% confidence interval).

    Is this something?

    You bet.

    We started by stating Hello Future, and we end saying, We are in the future.

    Disclosure: Long Sqnm
    Mar 02 12:33 PM | Link | Comment!
  • OSI (OSIP): Congratulation Prohost Subscribers. A Take Over with over 40% Premium.

    It was easy to predict and Prohost did not miss.  Prohost did not predict the name of the buyer, but has predicted a take over and kept reminding its shareholders about this prophecy in each and every Prohost Letter, together with the same for other firms. Remember the two letters TA, which are there in the Prohost tables (Target for acquisition) that are there since several months    reminding you about the articles predicting the acquisitions so you do not forget.


    Yesterday the news announced that the Japanese firm Astellas Pharma will commence a tender offer to acquire all outstanding shares of common stock of OSI Pharmaceuticals (OSIP) for $52.00 per share in cash, or an aggregate of approximately $3.5 billion on a fully diluted basis. The premium is significant reaching of over 40% on the closing price of OSI's common stock of $37.02 per share on February 26, 2010, a 53% premium to the stock three-month average of $34.01.  


    OSI is the developer of the famous lung cancer drug Targeva (erlotinib). The firm’s pipeline is impressive and the transaction offers Astellas marketed products and a superior pipeline of oncology, diabetes, and obesity products. The marketed products include Tarceva - a small molecule drug, which inhibits the receptor tyrosine kinase activity of the protein product of the HER1/EGFR gene and Novantrone, a mitoxantrone for injection concentrate.


    Astellas is inheriting also OSI-906, an oral small molecule IGF-1R inhibitor for various cancers, including NSCLC, breast, pancreatic, prostate, colorectal, adrenocortical, hepatocellular carcinoma, and ovarian; PSN821, an oral small molecule drug with anti-diabetic and appetite suppressing effects for type 2 diabetes; and OSI-027, a small molecule TORC1/TORC2 inhibitor to supersede first generation mTOR inhibitors. Other drugs include OSI-296, a novel tyrosine kinase inhibitor (TKI) that blocks compensatory signaling in epithelial tumor cells; OSI-930, a multi-targeted TKI that acts as a potent co-inhibitor of the receptor tyrosine kinases c-kit and the vascular endothelial growth factor receptor-2; PSN602, a novel dual serotonin and noradrenaline reuptake inhibitor for the long-term treatment of obesity; and OSI-632, an inhibitor of VEGFR-2.


    The pipeline drugs are extremely important and are expected to be used in combination with other approved drugs especially as more and more pathways involved in cancer and other diseases are discovered. (Read Prohost article “Gene-Disease Story” in the upcoming Prohost Letter #299).




    Astella is a real winner. With osi part of it, its financial strength and a product pipeline that fits future demands, adding its strong business operations and experience in the development and sales of new products, the combined company will be exceptionally promising. Astellas has great respect for the OSI organization and expects to integrate the strengths of OSI's business and employees into its operations as it has in the past with similar strategic acquisitions. Astellas will be offering a great investment opportunity. 


    Astellas will commence a tender offer on March 2, 2010, to purchase all outstanding common stock of OSI for $52.00 per share in cash.  Following successful completion of the tender offer, a merger will be completed at the same price. The complete terms and conditions of the offer will be filed with the U.S. Securities and Exchange Commission and disseminated to OSI stockholders.  Astellas has cash and cash equivalents on hand to complete the transaction.  The offer is not subject to any financing or due diligence conditions, and will be subject only to customary closing conditions, including the tender of a majority of OSI's shares of common stock on a fully diluted basis, and OSI's Board taking all necessary actions to make its stockholder rights plan and Section 203 of the Delaware Corporation Law inapplicable to Astellas' offer.


    There are no anticipated regulatory hurdles to completion.


    Citigroup is acting as exclusive financial advisor to Astellas and Morrison & Foerster LLP is acting as legal counsel.


    Following is a copy of the letter Astellas sent earlier today to Colin Goddard, OSI's CEO:


    Dear Dr. Goddard:


    As you know from our meetings, we have a great deal of respect for you and OSI, its employees and what the company has achieved.  We believe there are significant benefits from OSI's acquisition by Astellas and believe that a combined entity would allow us to achieve the goal of discovering, developing and delivering novel medications for patients with unmet needs in the oncology space far better than each of our companies could do independently.

    When we met on February 12, 2010, I presented our proposal to acquire all of OSI shares for $52 per share, a 50% premium to the prior day's closing price.  This followed Astellas' numerous attempts to engage in meaningful conversations with OSI over the last 13 months regarding the potential for bringing our two businesses together.  


    I was hopeful that our February 12th meeting would have finally resulted in a constructive attempt by you and OSI's Board to discuss a transaction and bring value to your stockholders.  Instead, your written response dated February 22nd stated that our proposal "very significantly undervalues" OSI.  It also contained a confidentiality agreement with a two-year "standstill" provision which we believe would not be in your stockholders' best interests, as it would have restricted us from making our offer directly to them.


    As we have stated to you consistently in our many communications to you over the last 13 months, we believe the acquisition of OSI by Astellas makes for a compelling business proposition and provides a unique opportunity for our respective stockholders, employees and customers. However, because your response indicates that you have no intention to engage in substantive discussions, our Board has authorized me to take our offer directly to OSI's stockholders.


    We remain enthusiastic about the potential of this transaction to realize the value of OSI's current commercialized products and to ensure the successful development and commercialization of additional products from its pipeline.  We respect your organization very much, and as such we would expect to integrate the strengths of your business and of OSI's employees into our company as we have in the past with similar strategic acquisitions.


    Our proposal would be subject to standard acquisition conditions, including the removal of your stockholder rights plan, and is not subject to any financing or any due diligence conditions. We do not foresee any regulatory or other impediment to closing.


    We continue to be excited about the possibility of bringing our two organizations together and we hope that you and your Board will reconsider your position and work with us to achieve a mutually beneficial outcome. Astellas has engaged Citigroup as financial advisor and Morrison & Foerster LLP as legal counsel to assist us in completing this transaction.  We and our advisors stand ready to meet with you and your advisors to answer any questions you may have about our offer.


    Congratulation Prohost Subscribers. We remind you though that the other firms in Prohost tables that have the two letters (NYSE:TA), will soon follow.

    Disclosure: Long Osip
    Mar 01 9:30 AM | Link | Comment!
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