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Savient Pharma Announces First Shipment and Pricing of KRYSTEXXA

|Includes:Savient Pharmaceuticals, Inc. (SVNTQ)
Today Savient Pharma (OTC:SVNTannounced the initial shipment to specialty distributors and pricing of KRYSTEXXA. These are two major milestones for a biotech stock basically left for dead by the market after a failed auction process back in late October.

Now the key will be how many vials of KRYSTEXXA at $2,300 a pop SVNT will be able to sell with a limited salesforce. Considering they had thousands of people wanting sign up for trials and those people are desperate for the drug the sell shouldn't be that hard. If you have been suffering from gout without any relief from existing drugs, this product should be able to sell itself.

The stock has been flat since the initial selloff. It is currently hanging out in the low $12s and offers substantial upside as the negative analyst community finally clues in that management is more then capable to go it alone having gotten the drug to market by Dec 1st nearly a month after announcing the failed auction process and a little over 2 months after getting FDA approval for the drug.

So why is the stock still below the pre approval level just below $15? Probably largely because the market fears dilution in the form of a stock offering. Though SVNT has nearly $80M in cash and the drug will only require a minimal salesforce, the market never less is overly paranoid.

It possibly comes down to how management handled the auction process. Unfortunately they gave the market the message that SVNT needed help to launch this drug. Even though they made it clear that they thought it would be more beneficial to an existing biotech firm to buy them prior to ramping up a sales force and logically it would, the market abused the process and turned it into a weakness. One that clearly doesn't exist based on this quick launch.

For any new investor, SVNT provides a great opportunity to buy a depressed stock with a FDA approved drug. This opportunity might not last long as the sales numbers get reported. The major issue continues to be the disagreement over the amount of users. If SVNT is correct, the stock will approach recent highs or nearly double todays price.

Via PR:

today announced that it is commencing shipment of KRYSTEXXA™ (pegloticase) to specialty distributors and that KRYSTEXXA will be commercially available by prescription in the United Stateseffective December 1, 2010.  A PEGylated uric acid specific enzyme, KRYSTEXXA was granted approval by the Food and Drug Administration (FDA) on September 14, 2010 for the treatment of chronic gout in adult patients refractory to conventional therapy.  KRYSTEXXA, targeted for this orphan population, is now the first and only therapy available to address this unmet medical need for highly symptomatic chronic gout sufferers who are refractory to conventional therapy here in the United States.

A specialty distribution network has been established that will allow healthcare providers direct access for ordering KRYSTEXXA.  The wholesale acquisition cost (NYSEMKT:WAC) of KRYSTEXXA will be priced at $2,300.00 per 8 mg vial for IV administration.  Savient is committed to providing patients access to our breakthrough therapy KRYSTEXXA. Through the KRYSTEXXA Connexxions™ program, Savient offers patients and healthcare providers coverage and reimbursement support, patient assistance and informational resources.  Patient assistance support is currently available for those eligible patients in the United States who do not have insurance coverage. Additionally, Savient intends to expand the KRYSTEXXA Connexxions program to include a co-payment support program in the coming weeks. For more information, please visitwww.krystexxa.com.

 

Disclosure: Long SVNT
Stocks: SVNTQ