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Back of the envelope analysis, reducing cognitive dissonance and the diminishing returns of due diligence.
  • Still No Fear of the Emisphere 10 comments
    Oct 21, 2010 10:27 AM | about stocks: EMIS, NVS

    Novartis, Emisphere's partner, disclosed in their quarterly earnings release that the EU trial for Oral Salmon Calcitonin missed the first of its 3 primary endpoints (you can infer from this that they hit their other 2).   So it turns out that I had it backwards in my last article; that they hit pain and function endpoints but missed Joint Space Narrowing (NYSE:JSN).  I would argue that this is an even better scenario.  Novartis still has the chance of showing some difference in the structure with the MRI's as this is where the cartilage shows up, not on the X-ray.  Analysis of the JSN  with the X-ray's did not hit the primary endpoint but I have heard that X-rays can be tough to measure.  I am still convinced that calcitonin grows cartilage and modifies the OA disease and that it is not a question of efficacy on this endpoint but time to efficacy.

    The bottom line is that Oral Calcitonin improves pain and function for people suffering from the horrible disease of osteoarthritis and that the drug has no side effect to boot; this makes it a slam dunk for approval and a blockbuster drug.  Stay tuned the Emisphere story is heating up.



    Disclosure: Long EMIS
    Themes: Biotech Stocks Stocks: EMIS, NVS
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Comments (10)
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  • Sturge8
    , contributor
    Comments (10) | Send Message
     
    I too read the same info,

     

    • Top line Phase III results (Study 2301) from SMC021 in osteoarthritis did not meet the first of three co-primary endpoints. Further analysis of the data is ongoing. The Phase III study in osteoporosis continues.

     

    I agree xrays don't show a great deal. However how long do you think we need to wait before the MRI results come to light? Will the other trial continue until 2013. Is the other trial continuing because they still believe OSC does grow back cartilage, but growth is slow and more than 2 years is needed in order to see JSW in xray testing?
    21 Oct 2010, 11:13 AM Reply Like
  • emis_fan
    , contributor
    Comments (11) | Send Message
     
    Thanks, Joe. I'm still trying to add up all the evidence we have to date (acknowledging that there is still a substantial amount of tea-leaf reading).

     

    To review the bidding: the Data Monitoring Committee found acceptable evidence of mid-trial efficacy for the EU trial; results for the completed EU trial nevertheless indicate (we infer) no efficacy with regard to JSN, but only analysis of MRIs will indicate that for sure. The DMC for the US trial did question efficacy, however. This raises the following concern.

     

    First, no DMC seems to be looking at MRIs, as far as I can tell. So that means it's unlikely that the EU DMC saw evidence of JSN efficacy when it deemed mid-trial efficacy to be acceptable. But that must mean that it made the efficacy judgment after seeing evidence of efficacy on 2 of 3 endpoints (pain and function).

     

    Second, the DMC for the US trial did not find acceptable evidence of mid-trial efficacy. So it must not have seen acceptable evidence from even 2 of 3 endpoints. It is least likely that it saw JSN improvement, given the EU results. This means, at best, the US trial DMC saw evidence of either pain or function improvement, but not both.

     

    If this is right, we have (so far) no evidence of JSN efficacy from either the EU trial (DMC and final results) nor US trial (DMC only), but none have looked at MRIs.

     

    An EU trial with both DMC and Phase III analysis showing efficacy with respect to pain and function improvement.

     

    A US trial with a DMC that potentially shows, at most, either pain or function improvement, but not both (since if it had shown both, the EU DMC suggests it would have deemed efficacy evidence to have been acceptable).

     

    Is this too pessimistic an interpretation (as I read it, I'm missing the board-shattering slam dunk)? It certainly could be the case that I've made a number of flawed assumptions (e.g., that DMCs don't see MRI evidence; that the EU DMC did not see evidence of JSN improvement; etc.).

     

    Thanks!
    21 Oct 2010, 08:39 PM Reply Like
  • Sturge8
    , contributor
    Comments (10) | Send Message
     
    I fully agree with you emis_fan and we need mri results to provide us with the full picture before we write this potential drug off. However I think you should read this article regarding Calcitonin.

     

    www.arthritisresearchu...

     

    To summarize, the article talks about Calcitonin having a modifying effect only when used in conjunction with other drugs. So all may be not lost. As the good work by Novartis still could be used when they work out the formula.
    22 Oct 2010, 04:54 AM Reply Like
  • Sturge8
    , contributor
    Comments (10) | Send Message
     
    www.arthritisresearchu...
    22 Oct 2010, 05:36 AM Reply Like
  • Envelope Investing
    , contributor
    Comments (15) | Send Message
     
    Author’s reply » Great points emis_fan. I think that Novartis will file for and get approval in EMEA. With regards to the US trial I don't know which endpoint(s) was a concern for the DMC. Perhaps you are right and they were not trending toward efficacy on either pain or function, or is it possible that they were just not trending toward efficacy on JSN and the DMC gave their no reason to proceed recommendation just based on that (that would mean that in the EU trial they were trending toward hitting JSN in the interim look, but missed the mark at trial completion)? I will try and makes some calls and get some opinions on what the likely scenarios are.

     

    I have heard that the FDA and the EMA are transitioning from X-rays to MRI's for OA trials, so even though we missed the JSN in Europe and possibly will in the US I don't believe that the claim of positively modifying the structure of the disease is dead. The FDA and the EMA have already shown signs of accepting MRI analysis and that is why it was included as a secondary endpoint. Maybe Novartis/Nordic foresaw X-rays as problematic from the get go? Such an interesting situation, right?
    22 Oct 2010, 08:12 AM Reply Like
  • Sturge8
    , contributor
    Comments (10) | Send Message
     
    News in from Emisphere. Results show "The recently completed study assesses the safety and efficacy of oral calcitonin in the treatment of osteoarthritis of the knee and had three co-primary endpoints. Novartis informed Emisphere that preliminary analysis of the data from this study shows that the endpoint for the first of three co-primary endpoints, joint space width narrowing, was not met. Novartis also informed Emisphere that results regarding the other two co-primary endpoints indicated clinical efficacy related to symptom modification (WOMAC scales: pain, function). In addition, according to Novartis, MRI analyses suggested an effect on cartilage."

     

    So they have MRI results and there is a suggested effect on cartilage. Sounds like the effect wasn't enough to slow the JSN down. Part failure? Shame as I had my hopes for this to fully work. Will they file for approval? Joe you there bud?
    22 Oct 2010, 09:20 AM Reply Like
  • emis_fan
    , contributor
    Comments (11) | Send Message
     
    Thanks, Joe, Sturge8. I think the arthritis study Sturge8 found resonates with Joe's point about possible future plans to combine SC with another drug. I only have one other point to throw into the mix. Novartis has been much more aggressive in pruning development projects that it judged not to be promising. SC has survived this.
    22 Oct 2010, 08:37 PM Reply Like
  • emis_fan
    , contributor
    Comments (11) | Send Message
     
    Another issue that will hopefully be addressed in the Thursday conference call (this falling under the rubric "the plot continues to thicken"): Emisphere's Eligen B-12 product, co-branded with Life's Extension, has been discontinued and is no longer for sale on the Life's Extension website. I can think of lots of reasons, many of them not bad (e.g., clearing the playing field for a broader-based partnership with another company, covering medical foods and over-the-counter, and going across many vitamins, not just B-12). But it's all just speculation. . .
    9 Nov 2010, 09:12 PM Reply Like
  • metzz
    , contributor
    Comments (4) | Send Message
     
    Joe,

     

    Novartis is excited and pumped to get there OP data to the panels.....Just a matter of months now. Keep the good pieces coming.
    20 Apr 2011, 05:03 PM Reply Like
  • tge
    , contributor
    Comments (17) | Send Message
     
    hey Joe,

     

    I know we had to send that padded wagon to you on that premature 10$ prediction for Emis last june, but with all the positive pending news from Novartis, Novo Nordisk,and B12, do you feel that we will see that 10$ by this summer?
    21 Apr 2011, 08:54 AM Reply Like
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