Shares of Alnylam Pharmaceuticals (ALNY) spiked as high as 18% yesterday after the company announced results from a phase 2 open-label study in patients with TTR-Amyloidosis in FAP. For starters open-label study means that Physicians and patients know that they are getting the Patisiran drug — Alnylam’s RNAi drug — and no placebo counterpart. The company is currently conducting a phase 3 trial for Patisiran in FAP known as the “APOLLO” trial. The addition phase 2 study was to run a study where investigators can see how the drug performs over a period of time instead of having a closed analysis. TTR-Amyloidosis is a disease characterized by excessive folding of the protein thereby depositing into pockets of the peripheral nerves and heart.
Alnylam is using Patisiran to knock down the TTR-genes that are produced in the liver itself. The RNAi drug itself using Tekmira Pharmaceuticals (TKMR) LNP — Lipid Nanoparticle — delivery technology is intended to knock down the genes of the diseases. The knocking down of theses genes is intended to improve the patients life expectancy and or prevent further damage in their body. In these phase 2 results reported the other day the Patisiran drug was able to achieve a knockdown of 90% of the TTR-Amyloidosis FAP disease over a 9 month period. Life expectancy for patients with TTR-Amyloidsosis in FAP is around 5 to 15 years from the moment the disease takes effect. There are about 10,000 patients Worldwide with TTR-Amyloidosis FAP disease therefore Alnylam should be able to give the Patisiran drug to this orphan disease. Orphan diseases are diseases that are an unmet medical need that affect less than 200,000 patients worldwide. This gives Alnylam special perks if this drug makes it past the final phase 3 clinical trial like longer exclusivity in sales, and quicker review from the FDA.
In addition the efficacy of Patisiran was measured using a score technique known as the Modified Neuropathy Impairment Score — (mNIS+7). The basic thing to know about this is that patients with TTR-Amyloidosis end up with 10 points or higher on the score taking a placebo drug. on the other hand taking Patisiran the patients actually decreased by about 1 point. Generally this is good because patients taking Alnylam’s drug were able to avoid going up in score like placebo patients have done in the past. This shows the true efficacy of RNAi science, and the promise of RNAi for the future.
Alnylam is currently the leader in RNAi at the moment but that doesn’t mean it won’t change later down the line. Despite that this company continues to see excellent clinical trial results and already has an RNAi drug in a phase 3 clinical trial. There are no approved RNAi drugs on the market so Alnylam has the opportunity to become the first RNAi biotechnology company to have an approved RNAi drug. We believe the company to be a great long term buy as the company advocates its 5×15 program. This means that Alnylam expects to have 5 mid stage drugs by 2015 in the RNAi space. Sanofi (SNY) is already excited about Alnylam’s prospects as it has already acquired about 18% of the company. We believe that Alnylam is positioned well in the RNAi space and will continue to post positive results for other drug compounds in the clinic.
Today the CEO and President of Rxi Pharmaceuticals (RXII) announced additional results from the phase 2a trial using RXI-109 against hypertrophic scars. The previous article we wrote discussed the early 1-month results of RXI-109 against hypertrophic scars in phase 2a. As we stated in this previous article 1-month is too short of a time span to tell whether or not RXI-109 achieved clinical efficacy or not. Regardless of this the cohort 2 results for RXI-109 were better than placebo even at the 1-month time point. Today’s results show how the RXI-109 drug worked on hypertrophic scars at a 3-month time point shown by slides 15 and 16 shown here “Rxi BioForum Presentation slides”
We also mentioned before that if the 1-month photos looked good, then the 3-month photos would look even better and we were right. This is because hypertrophic scars take 3 to 6 months to grow back fully therefore cause an irrational panic sell off on the 1-month results because investors didn’t understand the clinical data. Today’s pictures shown in the Rxi Presentation slides shown above have now validated the sd-rxRNA platform. This means now we know RNAi — RNA interference — can now be used to turn off specific genes of a particular disease. With Today’s news the share price of Rxi Pharmaceuticals should eventually gap up to a higher market cap of at least $500 million close to its other peers in the RNAi industry like Tekmira Pharmaceuticals (TKMR) and Arrowhead Research Corp (ARWR).
This validation is important because now the company is at a reduced risk investment level since we now know that RXI-109 works in humans 3 months post surgery compared to a placebo compound. Getting this drug to market would be a huge step to help the company move itself forward as it could stand to make $1 billion to $1.5 billion dollars in the U.S. alone. Also this should help Rxi to obtain a partnership easily now as it has proven its technology to work in humans in a mid-stage trial. The company though is not a one trick pony because it is advancing its ophthalmology pipeline as well and is expected to file an IND for RXI-109 in eye diseases in the coming months. In other words Rxi is just getting started with its RNAi technology and should continue to do well in the coming years.
Going forward though there are plenty of catalysts that should be expected from Rxi. Some of them include the addition of another midstage clinical trial to the pipeline. This is listed at the end of the slides but as of now it is not clear what the company will be adding to the pipeline. The company says it expects to report about this addition of the mid stage phase 2 trial by the end of 2014 as mentioned by the CEO in the presentation. Other Catalysts should come at the beginning of 2015 when the company expects to report clinical trials on its other early stage programs like macular degeneration — vision loss in older adults– and Retinoblastoma — eye cancer in children under 15. We think that investors now have a golden opportunity to enter a biotechnology stock that holds a promising future and has completely de-risked itself with these great phase 2a results.
On September 28th 2014 Clovis Oncology (CLVS) announced that it had reported positive results in a phase 2 clinical trial in treating patients with Ovarian Cancer. The phase 2 trial was known as the ARIEL2 study and had recruited 20 patients to take 600 mg of a drug compound known as Rucaparib. Rucaparib is an oral inhibitor pill that these patients take to inhibit the genes of the Ovarian cancer known as PARP-1 and PARP-2. This type of Ovarian Cancer is a type where patients have a BRCA mutation gene. This means that this cancer is a type of a rare cancer that occurs in ovarian cancer patients. Clovis though is currently using Rucaparib to target tumors with defective DNA repair functions. The first two initial tumors being targeted are in Ovarian Cancer and Pancreatic Cancer.
The company stated that of those patients taking Rucaparib 95% (14 out of 15) had a Disease Control Rate — DCR. DCR means that the patients in the study either had a complete response, partial response, or a stable disease. This bodes well for the compound as it shows that patients being treated are able to not only control the spread of the cancer but somewhat prohibit it from forming. Eight of the twelve patients that achieved a partial response in the trial did so in week 6 of taking the drug compound. These preliminary data were presented at a conference in Madrid known as ESMO — Europen Society Of Medical Oncology. As we can see in this early clinical evidence Clovis Oncology seems to be doing well with its Rucaparib drug compound, and still has additional oncology compounds in its pipeline.
There are about 21,980 cases of Ovarian Cancer in the United States in 2014 thus far and a limited amount of treatment options for these patients. Clovis even discovered in its trial that patients without the BRCA gene Ovarian Cancer still benefited with treatment from using Rucaparib. This finding can be established in new phase 2 trials later down the line in other Ovarian Cancer patients. The stock surged on Monday September 29, 2014 by 13% on the news, but today has declined down by 6% to close the day at $45.36 per share. Clovis Oncology is an attractive oncology company with variety of clinical compounds that may help improve the lives of these cancer patients.
We believe that Clovis Oncology should not be ignored because as it stands now the company is set up to be possibly bought out by another big pharmaceutical company that may want to add to their oncology pipeline. We believe that Clovis would be a great investment for investors looking for future growth and potential acquisition target. Investors should definitely keep an eye on this biotech stock in the coming months. Matter in fact Clovis expects to report additional phase 2 trial data on this ARIEL2 study in patients with Ovarian Cancer this coming November at a Symposium conference. This should give another catalyst for the share of Clovis and should provide investors with further guidance on the future of the company’s direction with its cancer compounds.
Shares of Tekmira Pharmaceuticals (TKMR) surged as much as 17% to a share price of $23.61 per share after the FDA and Health Canda have agreed to allow TKM-Ebola to be given to patients under the “compassionate use” clause. Also in addition to that news in the morning news came in after the bell on September 22nd stating that TKM-Ebola was used to treat Dr. Sacra who was infected with the Ebola virus. Dr. Sacra was infected because he was attempting to help patients in West Africa, but was afflicted with the disease himself. It was disclosed that TKM-Ebola was one of his forms of treatment but he also received other experimental drugs as well. This is a great advancement for Tekmira Pharmaceuticals as it may be able to obtain some revenue from treating patients with its drug. Although investors should note that this Ebola drug for Tekmira won’t generate billions of dollars, not even millions of dollars either. That is because as of right now there are limited patients that currently carry the ebola virus, and it may not be a profitable disease to treat in the future. In the interim though the stock will trade higher on the ebola hype. This news is bullish for Tekmira in the short term although it is unclear how it will affect the share price in the long term.
The share price going up 17% was a nice boost, although today the stock did continue some of its gain with additional news. The news today was that Tekmira would be allowed to test their TKM-Ebola drug on patients infected with the ebola virus. This goes a long way to where many months ago the FDA put the TKM-Ebola drug on hold due too safety concerns. This goes to show though how quickly the tide can change in the biotechnology industry and investors need to be ready when this type of volatility occurs. On top of testing out their ebola drug on patients deemed to be infected by the ebola virus, Tekmira has stated that it has been selected to take part in clinical trial in Africa as part of an international effort to curb the spread of the ebola virus.
Investors should take note though what was mentioned above. More tests are needed to particularly confirm that TKM-ebola was the drug responsible for saving Dr. Sacra’s life. Although we believe it is a high possibility as Tekmira’s LNP — Lipid Nanoparticle — technology encapsulates siRNA or small interfering RNA molecules. The basic function of these molecules are to stop the genes of the ebola virus from producing proteins and then spreading throughout the body. TKM-ebola if proven to succeed in other patients will produce a great confirmation for Tekmira’s LNP technology platform. The company has other pipeline candidates that it is working on like its Oncology franchise. Tekmira’s oncology franchise is targeting solid tumors and those results are expected to come in several months. We believe that Tekmira Pharmaceuticals is a great long term name regardless of the ebola drug compound. Investors should note one key thing about Tekmira and that is that the company is not dependent on the TKM-ebola drug. The TKM-ebola drug is just an extra boost for the stock, but in the long term the company can succeed without TKM-ebola.
Today Rexahn Pharmaceuticals (RNN) announced that it will be attending the BioPharm America 2014 Partnering Conference. This is significant because the previous partnership with Teva Pharmaceuticals (TEVA) came from exactly the same conference. This conference allows small-cap biotechnology companies to sit down with a lot of various pharmaceutical companies looking for innovative drug companies to partner with. Rexahn was able to partner out a drug compound known as RX-3117 with Teva at this conference.
There is no guarantee that Rexahn will be able to establish a partnership at this conference, and even if the company does find a pharmaceutical company to partner with it could take months to establish a deal. Therefore we don’t recommend that investors buy shares of Rexahn only because of a potential partnership but because they believe in the future value of the RX-3117 drug itself. First to understand what RX-3117 is and why a pharmaceutical company would want to form a partnership with this compound we have to understand its value. RX-3117 is a nucleoside analog compound that inhibits both DNA and RNA synthesis.This inhibition of Synthesis the blocking of DNA and RNA molecules from combining to form a protein thus creating new cancerous cells.
The key point for RX-3117 is not only that it would block both DNA and RNA from synthesizing but the drug compound only targets cancerous cells and leaves healthy cells alone. A lot of biotechnology companies are looking towards new treatments for cancer that avoid the toxicity of current therapies like chemotherapeutic drug compounds. Even though the partnership between Rexahn and Teva didn’t work out it does not mean that Rexahn should stop exploring options to partner this drug compound with anotehr big pharmaceutical company. A lot will need to be done to prove the power of the RX-3117 compound but Rexahn establishing a partnership will be helpful for moving the company forward.
So despite the breakup Rexahn should be able to establish a new partnership with another biotechnology company. The partnership may not come instantly, and it will be a long road but it is in the company’s best interest to partner out the compound. Especially a company that is in early clinical stage testing and has no other means to generate revenue. If proven successful in clinical trials RX-3117 could be applied to many types of solid tumors and could generate billion of dollars in revenue. RX-3117 is in great shape because the compound is currently in the middle of recruitment of the 4th dose group at (150mg) as the MTD — meaning maximum tolerated dose patients can sustain without a lot of toxicity — has yet to be established. This bodes well because the higher the MTD can go the greater the efficacy of the compound during the readout in the future. Rexahn expects the phase 1b trial for RX-3117 enrollment to be completed by Q4 2014 or Q1 2015. The wait is not too bad as the company is expected to also report on other compounds in the clinic. Rexahn is expected to report the phase 2a trial for Archexin by Q4 2014, and final results for Supinoxin phase 1 in Q4 2014. We believe that Rexahn is a nice long term hold, and the entry share price point is attractive at $0.74 per share as well.
Today the CEO of Rxi Pharmaceuticals (RXII) presented preliminary phase 2a data for hypertrophic scars at the Rodman and Renshaw Conference. We think that today’s sell off was overblown way out of proportion, because if we look at the preliminary evidence there was nothing wrong with the results. Rxi’s 31% drop to $2.44 per share acted as if the trial totally bombed, but in actuality it didn’t. We will explain in great detail why the share price dropped and why we believe this is a good buying opportunity for anyone that wants to be a long term investor in Rxi Pharmaceuticals.
For instance here is the link to the Rodman and Renshaw Conference webcast. One quick note is that each cohort was evaluated by an analysis known as VAS. In VAS the individuals score from a (0) — fine line scar to a (10) worst scar seen possible. What this means is that 11 individuals assessed Cohort 1 in early treatment with RXI-109 and placebo. Now in the cohort 1 trial both the median score for RXI-109 and placebo was a (2). So early treatment in cohort 1 created no difference between RXI-109 and placebo. In cohort 2 though utilizing delayed treatment RXI-109 achieved a VAS score of (2) and placebo achieved a VAS score of (2.5). Now before we go any further we believe that a lot of investors didn’t quite understand that these results were only 1 month after the surgery period. So even after only 1 month after surgery RXI-109 in cohort 2 fared better than placebo.
If we take a look at slide 19 in the “Webcast” link above you will notice that RXI-109 shows a finer thin line compared to the placebo which is more raised in appearance. We think investors unfairly punished the share price, because if the one month results came out better than imagine another 2 months post surgery. The results for RXI-109 at 3 months post surgery should look far superior, and the company has stated in the presentation that those are coming within the next few months. Also to many people don’t understand clinical trials and we believe today’s sell off was a notice of share price tanking and immediately reacting to the share price. This is because this trial was a phase 2a trial that means two things happen in a phase 2a trial.
First the trial tested two different cohorts which compared early treatment with RXI-109 and then delayed treatment. Now Rxi knows from this phase 2a trial that delayed treatment produces better results for the compound. Secondly the trial was looking for efficacy using the current dosage post one month. I think the company will need to see the the 3 month pictures (which will come within the next few months) this way they can better determine the proper dosage for the phase 2b trial. We think a lot of people misunderstand the difference between a phase 2a trial and a phase 2b trial. If the company had max dose then the would have just ran a phase 2 trial and be done with it. But they didn’t because they needed to see the initial efficacy using the current dosage. With the knowledge after observing the 3 month pictures in hypertrophic scars, the company can then better design a phase 2b trial with a possibly higher dosing regimen.
Maybe the company could have waited to release the 3 month data instead of releasing the early 1 month data. Despite that cohort 2 still performed better than placebo in hypertrophic scars which is not an easy thing to do considering there are no FDA approved drugs for scarring. The 3 month data pictures in hypertrophic scars will come within the next few months and that will be the true measure of where the company can go from there. One quick note is that RXI-109 was shown to still work 3 months after a single injection which means the 3 month photos should be better. In the placebo side the scars will grow back with a vengeance so the difference will be clearly visible.We believe the share price was unfairly punished today despite RXI-109 performing better than placebo. With the current share price at $2.44 per share and a market cap of only $34 million along with the preliminary presented phase 2a data we think Rxi Pharmaceuticals is severely undervalued.
Rxi Pharmaceuticals (RXII) will be presenting next Wednesday September 10th at the Rodman And Renshaw conference. Under normal circumstances conferences are no big deal as they just lay out what most investors already know, but this time it is different for Rxi. This is because Rxi has stated in its press release today that it will show data on new novel targets in the dermatology field, and that it will release data from its phase 2a interim trial using RXI-109 against hypertrophic scars.
Why do we bring this to the attention of investors now before this big event. For starters there is the potential to make huge gains when the phase 2a results are released. There is no way for sure to know how good the results are, but after evidence we have described in a previous article we are inclined to believe the data to be de-risked and positive. For instance the RXII share price has risen by 40% over the last 5 days in anticipation of these phase 2a interim results. Even with this recent 5 day rise of 40% that still only puts the company at a market cap of $60 million.
Therefore we believe that even with this recent rise the company is still way undervalued to its trading peers in similar phase 2 trials like Arrowhead Research Corp (ARWR) which trades at a market cap of $800 million and Tekmira Pharmaceuticals (TKMR) who has a market cap of 440 million. That means right now at 60 million market cap Rxi is trading at around 13 times too 7 times respectively less than its peers in similar stage phase 2 trials. Even accounting for most other biotechnology stocks which trade at a fair value of around $500 million in the phase 2 stage of trials Rxi should be trading at around $18.45 per share.
The fact that Rxi trades so low compared to its RNAi technology peers and momentum towards phase 2a results could be what propelled the share price higher this past week. Why are investors excited about the phase 2a results? Well quite frankly if the phase 2a results come out extremely positive it will validate Rxi’s technology platform known as the “sdrxRNA” platform. In essence without going into the pharmaceutical aspect of it it is a platform of combining both the properties of RNAi and RNA into one drug molecule that can be delivered directly into tissue, eyes, skin etc. of choice without using a delivery vehicle. RNAi stands for RNA interference and is the ability to shut off genes at the source before they ever produce a protein of the disease to begin with. RNA stands for Ribo Nucleic Acid and is the building block of DNA, and companies working with RNA compounds change the way the mRNA — messenger RNA responds in the disease that is being targeted.
The importance of these results are at an extreme because one it will validate that RNAi science can be used to treat disease as to date there are no RNAi therapies approved by the FDA. Secondly it will validate Rxi’s sd-rxRNA platform. With this validation the company can then use its technology to expand to other billion of dollar markets like macular degeneration, liver fibrosis, and other unmet medical needs. The company has also stated that it will discuss data of new novel compounds that it will use its sd-rxRNA technology for which will also target the dermatology field. No one can say for sure what the new novel compound targets will be but if we base it off of market potential it could possibly be the corneal scarring of the eye which the company found on accident in its eye monkey study. It could also hypothetically be Lupus or Psoriasis, and we are estimating this to be the case since these disease also affect the skin and the sd-rxRNA platform is good at distributing the drug compound directly into the skin.
With positive results in RXI-109 against hypertrophic scars the estimate valuation of potential sales could be around $1.5 billion dollars as a low end estimate as a drug without insurance could be worth. For instance Allergan (AGN) Botox drug sells for billions of dollars and patients still utilize the drug compound despite not using insurance to pay for it. The validation of the sd-rxRNA platform would establish Rxi as a product development company and should see potential partnerships rise up thereafter in the following months. We believe that Rxi Pharmaceuticals is still extremely undervalued at only $60 million market cap and think that Rxi still has room to run higher before the potential phase 2a data in hypertrophic scars. We look forward to next Wednesday where we will potentially discuss the new novel compounds in detail, and go a little in depth on the phase 2a results in hypertrophic scars.
Just a few days ago on Sunday August 24, 2014 Roche (RHHBY) had agreed to buy an biotechnology company known as Intermune (ITMN) for $74 per share, which comes with an $8.3 billion dollar share price. The price was a good deal for shareholders because it was a 38% premium to the last closing price on August 22, 2014. Intermune is a company that if focused on treating a rare lung disease where patients have limited treatment options. We feel that this recent acquisition may spur other biotech merger deals in that big pharmaceutical companies will be looking for the next best drug that could potentially make billions of dollars on the market.
The drug that Intermune has created is known as perfenidone which is already marketed in Canada under the name Esbriet. Esbriet treats a rare lung disease known as idiopathic pulmonary fibrosis which is a disease characterized by damaged lung pocket that form severe scars. These scars hinder the lungs by making them harder, because typically these lung sacs are thin. With these thickened lung sacs the lungs have a hard time expanding properly and exchanging oxygen at a normal rate. The drug compound from Intermune is an oral drug compound that is made up of a molecule known as TGF-beta which plays a major role in many fibrotic diseases.
Some are skeptical about the deal because the current drug Esbriet brings in $1 billion dollars so why would Roche pay $8.3 billion dollars? We can hypothesize that it is probably for the many other rare fibrotic disorders that are targeted in Intermunes remaining pipeline. Therefore we believe Roche is looking out into the future on how much they could potentially make many years from now. With this deal though many other biotechnology stocks that are potential takeover targets have also seen a huge influx of investors interest in the last few days.
Other potential take over stocks seeing a huge rise in volume would be Arrowhead Research Corp. (ARWR) and Achillion Pharamcueitcals (ACHN). That is because they both have what big pharmaceutical companies are looking for to fill their pipeline with a hepatitis B and hepatitis C drug candidate respectively. Both of these companies target large markets, and so many analysts on Wall Street along with many enthusiastic investors believe that these will be next on the list as a buyout candidate by big pharma. I have written about a possible buyout by a big pharma for Achillion Pharmaceuticals seen here “Achillion Pharmaceuticals Is Primed For An Eventual Buyout“. A more detailed analysis on Arrowhead Research Corp can be seen in this article here ” Arrowhead Starts It’s Engine For Phase 2a Trial For Chronic Hepatitis B Infection “.
We think that there are many biotechnology companies that have the potential to unlock a lot of value. We believe that Roche took this opportunity because other than Hepatitis C and Hepatitis B drug candidates, the next best thing is drugs that target fibrotic disorders. This is because there are many patients suffering from some type of fibrotic disease and it gives these companies the potential to make billions of dollars off of therapies for this disease area. Ultimately liver fibrosis is another huge market that could potentially be unlocked over time, and one company we have mentioned on many occasions before that has a strategic interest to target liver fibrosis is Rxi pharmaceuticals (RXII) which makes perfect sense since the company’s lead drug candidate targets anti scarring of hypertrophic scars and keloids. Rxi is set to report phase 2a results in the coming weeks so good results there will automatically validate its target compound RXI-109 and its sd-rxRNA self delivering platform for Liver fibrosis as well. Be on the lookout for the next possible biotech merger deal because we are pretty sure this acquisition by Roche recently won’t be the last one.
Shares of Achillion Pharmaceuticals (ACHN) had gained about 10% for reporting positive results in a mid-stage trial of its hepatitis C drug ACH-3102 in combination with Gilead Sciences (GILD) drug Sovaldi — also known as sofosbuvir. The trial enrolled 12 patients to test the combination of ACH-3102 together with Sovaldi to determine the efficacy of this combination of drug compounds. The results were outstanding because the combination of ACH-3102 together with Sovaldi was able to achieve a 100% cure rate of the hepatitis C virus. All 12 patients had undetectable HCV — Hepatitis C virus RNA levels for 4 weeks after completing the cycle of therapy. Hepatitis C virus RNA levels are the measure of how much of the virus is still left circulating in the blood of the patient.
There are two key components for why this combination study was important for Achillion Pharmaceuticals. For starters standard of care treatment for hepatitis C patients is adding a toxic chemical known as Ribavirin for clearing the virus from the body. Even then the cure rate for Ribavirin alone in hepatitis C isn’t all that great, and leads to many unbearable side effects for the patients. The second thing to note is that this proves that ACH-3102 is able to be combined with a nucleotide NS5B Polymerase inhibitor– which is what Sovaldi is. ACH-3102 is an NS5A inhibitor, and is a different compound from Sovaldi. The good news now though is that Achillion is also working on a similar drug compound for the hepatitis C virus known as ACH-3422 which is also a nucleotide NS5B Polymerase inhibitor.
This is good news for Achillion because now moving forward it can combine both ACH-3102 together with ACH-3422 into one drug compound. This could then potentially prove in later trials a 100% cure rate in the hepatitis C virus and be able to compete in the market against Sovaldi. We don’t know yet because all is dependent on how well the two chemical drug compounds from Achillion go together, plus also it depends on how long the drug combination takes to cure the virus — how many weeks of treatment. While that remains to be seen this initial positive result of combining ACH-3102 together with Gilead’s Drug Sovaldi shows the potential for a combination of combining an NS5A inhibitor together wtih an NS5B inhibitor.
The hepatitis C market is huge, and Achillion may have a chance to be a part of this huge market if its ACH-3422 drug proves to clear the hepatitis C virus by 100%. Sovaldi is selling well matter in fact the drug compound made$3.48 billion dollars in second quarter sales in 2014. Eventually Achillion may have an opportunity to capitalize on this market in the mean time shares of the company have surged as much as 184% year to date. We think that the continuation of successful results with the company’s hepatitis C pipeline will bring in other big pharmaceutical players to attempt a buyout of the company. Many big pharmaceutical companies are looking to fill their pipelines with a hepatitis C drug compound. Buying Achillion Pharmaceuticals may be that way for these big pharmaceutical companies to get their foot in the door on this growing hepatitis c space. Therefore we believe that Achillion Pharmaceuticals will eventually be bought out for billions of dollars.
On August 11, 2014 OPKO Health (OPK) had released its results for a phase 3 trial utilizing a drug known as Rayaldee to treat patients with chronic kidney disease that are insufficient in Vitamin D (Vitamin D insufficiency). Vitamin D insufficiency means that the person’s body is not able to easily convert the Vitamin D mineral to the body which results in a loss of vital nutrients. Vitamin D in the body is essential for renal health, immune system health, and cardiovascular health. Vitamin D insufficiency is even worse in patients with chronic kidney disease, because the disease makes it a lot more difficult for the patients to be able to convert Vitamin D into their bodies properly.
Opko Health posted positive phase 3 results for its Rayaldee drug compound by improving Vitamin D levels in patients with secondary hyperparathyroidism — SHPT — which stems from stage 3 and stage 4 chronic kidney disease. The results can be summed up by the Vice President of Research and Development Joel Z Milnick of Opko’s renal health division:
“Top-line data from this study demonstrate that Rayaldee effectively controls secondary hyperparathyroidism in patients with stage 3 or 4 chronic kidney disease by correcting vitamin D insufficiency”
The phase 3 results were able to help patients achieve the ability to properly elevate the patients’ vitamin D levels to appropriate measures. The phase 3 trial had enrolled 219 patients which were all lacking Vitamin D . Some patients were given Ryaldee and other patients were given a placebo compound. By the end of the trial 97% of the patients had corrected their Vitamin D insufficiency by taking Rayaldee, which shows the market potential for the drug when it makes it to market. The Rayaldee compound was able to achieve great safety measures and also achieve the primary endpoint of the study. The primary endpoint of the study was something known as “responder analysis”. This means that at least 30% of the patients needed to exhibit a decrease of the plasma parathyroid hormone — effect of chronic kidney disease. Two positives came from the primary endpoint of the study. For starters the response rate of the primary endpoint achieved clinical efficacy of p < 0.001 . This p value is a measure of clinical success, and anything under p < .01 means that the trial achieved its primary endpoint.
The success of this treatment is great because current treatment options have their own problems. Vitamin D offered over the counter are ineffective in helping these chronic kidney disease patients with their hyperparathyroidism at all. Vitamin D Hormones actually do more harm than good because they offer Vitamin D at extremely abundant levels. That means they bring the Vitamin D level to a higher level than is needed in the body — basically way too much Vitamin D . Investors though will still be happy to know that there are further catalysts coming for Opko’s Rayaldee drug before the end of 2014. First the company expects to announce additional data from a similar phase 3 trial using Rayaldee for the same indication of Vitamin D insufficiency in Chronic Kidney disease. These additional phase 3 results are due out sometime in September 2014. Another catalyst is that Opko expects t file an NDA for Rayldee to the FDA before the end of 2014 — this means that the company is seeking approval for Rayaldee.
We believe that Opko Health is a great long term play because it has a nice pipeline of drug compounds that can create future value for shareholders. We also like the fact that the CEO is a man known as Dr. Phillip Frost who is famous for acquiring biotechnology stocks that come in value in the future. Dr. Phillip Frost knows true value when he sees it, and we feel Opko will do well in the long term. Dr. Phillip Frost had even invested in a biotechnology company known as Rxi Pharmaceuticals (RXII) when it was trading back on the OTC. Rxi Pharmaceuticals now trades on the NASDAQ and is expected to release phase 2 results of a trial in a few weeks, using RXI-109 to target hypertrophic scars — raised scars that are difficult to treat and grow back instantly. Dr. Frost had made a private placement deal buying $16.4 million dollars worth of shares during the deal with Rxi’s CEO Dr. Geert Cauwenbergh back in 2013. We believe that Opko will continue to rise as investors realize the true value of the company.