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Tuesday, October 25, 2016

Oryzon Secures Financing, ORY-1001 Data Expected At ASH

On October 24, 2016, Oryzon Genomics (MADX: ORY) reported financial results for the third quarter ending September 30, 2016. Total collaborative revenue in the third quarter was $0.252 million, bringing revenue for the first nine months of 2016 to $0.785 million. Revenue is derived from collaborative research work with Roche on ORY-1001, deferred recognition of a previous upfront payment from Roche for ORY-1001 in 2014, and non-dilutive research grants that support work on ORY-2001.

The loss for the quarter totaled $1.5 million, driven by $1.5 million in R&D and $1.4 million in general and administrative costs. Oryzon continues to invest in its therapeutic pipeline, having recently advanced ORY-2001 into a multiple ascending dose study and nominated ORY-3001 for IND-enabling studies in non-oncological conditions.

Oryzon exited September 2016 with $32.1 million in cash, equivalents, and short-term investment. Cash increased $7.8 million from December 31, 2015, thanks to the closing of the second tranche of debt financing of $5.9 million USD. These proceeds come on top of the $11.6 million USD first tranche of debt financing raised in May 2016. In total, Oryzon has raised more than $35.5 million USD since July 2015. I project operating burn over the next year will be between approximately $13-15 million. Thus the current balance is sufficient to fund operations for the next 18 months. There are approximately 28.5 million shares outstanding.

Monday, October 24, 2016

Could VistaGen's AV101 Be The Next Abilify?

I've been following VistaGen Therapeutics (NASDAQ: VTGN) for several months now. The California-based biotech is developing AV101, a glycine B (GlyB) receptor antagonist that negatively modulates the N-Methyl-D-aspartic acid (NMDA) receptor. AV-101 is an oral prodrug candidate that has demonstrated impressive antidepressant effects and safety in preclinical and Phase 1 studies.

The mechanism of action is similar to ketamine, which means it might also prove useful in other psychiatric disorders such as bipolar depression, suicidal ideation, obsessive-compulsive disorder, and anxiety. AV101 may induce synaptogenesis, which might hold utility to treat neurodegenerative diseases like Huntington's disease or in patients following a traumatic brain injury. The drug is also unlikely to be abused, which opens the potential for lack of DEA scheduling and expanded patient populations like adolescents and the elderly. 

In short, I think AV101 has tremendous potential. It reminds me of Abilify® (aripiprazole), one of the most successful drugs of all time. Aripiprazole was developed by Otsuka Pharmaceuticals Co. Ltd of Japan and was co-promoted in the U.S. for over a decade by Bristol-Myers Squibb. The agreement expired in 2012, at which time Otsuka regained full rights. Sales peaked at nearly $9.5 billion worldwide in 2013, nearly $7 billion of which was in the U.S. The patent has since expired and the drug is now widely available as a generic. 

For the purpose of this article, I thought I'd look at the potential for AV101 to be "the next Abilify", or at the very least, be used similarly to Abilify as an adjunct therapy for patients failing first- and second-generation antidepressants. That market alone is blockbuster in size. Adding on some of the additional indications, like bipolar depression, acute suicide prevention, or anxiety, could put AV101 in the same category as Abilify as one incredibly successful CNS drug.

Thursday, October 20, 2016

Phase 2b Data Continues To Impress From HedgePath Pharma

Interim Update Further Validates Why I'm Bullish On HPPI

In August 2016, I introduced investors to HedgePath Pharmaceuticals (HPPI) and the company's improved formulation of itraconazole for the treatment of Basal Cell Carcinoma Nevus Syndrome (BCCNS) / Gorlin Syndrome called SUBA-Cap. Investors can view that article >> HERE

HedgePath is currently conducting a Phase 2b trial with SUBA-Cap. Shares are up 134% since August 2016, driven in part by two positive interim results released over the past three months from the ongoing Phase 2b trial. The most recent update, which came this morning, demonstrates continued impressive results for SUBA-Cap. Below I provide a review of the positive Phase 2b data and compare it to Erivedge®, a leading product approved for metastatic and locally advanced basal cell carcinoma, but not for BCCNS, sold by Genentech/Roche.

Thursday, October 13, 2016

An Interview With Relmada Therapeutics

Relmada Therapeutics (OTC: RLMD) is developing REL-1017 for the treatment of depression and neuropathic pain. REL-1017, also known as dextromethadone or d-methadone, is a non-competitive antagonist of the N-methyl-D-aspartic acid (NMDA) receptor. This mechanism of action has received significant attention from the psychiatric community over the past several years due to the expected rapid onset of action versus weeks or even months for first and second generation antidepressant. The potential exists that REL-1017 could be a potential breakthrough approach to treating patients with major depressive disorder that are resistant to current FDA-approved antidepressants.

REL-1017 represents a potentially significant commercial opportunity for Relmada. Several biopharma companies, including behemoths like J&J and Allergan, along with upstarts like Relmada, are attempting to develop new treatment options for severely depressed patients by targeting the NMDA receptor. In this area of research several smaller and more innovative companies, including Relmada, have the potential to bring competitive new drugs to the market that could generate blockbuster sales. To learn more, I decided to speak with senior management at Relmada.

Tuesday, October 11, 2016

Comparing Actinium's Actimab-A To Seattle Genetics' SGN-CD33A

Last month, Actinium Pharmaceuticals Inc. (NYSEMKT: ATNM) announced the initiation of a Phase 2 clinical trial of Actimab-A in patients newly diagnosed with Acute Myeloid Leukemia (AML) who are over the age of 60. Elderly patients with AML face poor prognosis and have limited viable treatment options. it is an area of significant unmet medical need. Actimab-A, Actinium's most advanced alpha particle immunotherapy (APIT) program, consists of the CD33 targeting monoclonal antibody, lintuzumab, and the alpha-emitting radioisotope, actinium-225.

Several biopharma companies are working on therapeutic agents for AML that target CD33, including Amgen, Bayer, Boehringer Ingelheim, and J&J. However, only Actinium and Seattle Genetics (SGEN) have progressed beyond Phase 1 studies. For the purpose of my article today, I will look at Actimab-A compared to SGEN's SGN-CD33A.

Thursday, October 6, 2016

RedHill's Phase 3 Crohn's Disease Program Just Got More Interesting

On October 6, 2016, RedHill Biopharma Ltd. (NASDAQ: RDHL) announced a number of changes and protocol enhancements to the ongoing Phase 3 Crohn's Disease (CD) program with RHB-104, dubbed MAP-U.S. The changes are designed to enhance the overall robustness of the study and provide a more comprehensive assessment of RHB-104’s treatment effect. These changes will allow RedHill to increase the pace of enrollment, as well as better evaluate all patients enrolled in the study and bolster the likelihood of success.

RedHill has both increased the size of the trial and the amount of data they plan to collect as part of the trials key endpoints. Importantly, an independent data safety monitoring board (DSMB) review of the trial will take place in the second quarter of 2017. This review will include both a safety and interim efficacy analysis, and could potentially provide the opportunity to expedite the data locking process for the final analysis. Furthermore, this DSMB review will also evaluate the option of an early stop for success, according to a pre-specified statistical significance threshold for analysis requiring overwhelming efficacy of RHB-104 versus placebo in the primary endpoint.

Wednesday, October 5, 2016

Valeritas V-Go Saves Money, Improves Quality of Life

Valeritas Holdings, Inc. (VLRX) is a commercial-stage medical device company focused on developing innovative technologies to improve the health and quality of life for people with Type 2 diabetes. The company's flagship product is called V-Go, and it is currently on the market in the U.S. V-Go is a small, wearable device designed for patients with Type-2 diabetes who require daily insulin to achieve and maintain their target blood glucose level. It is the first and only U.S. FDA and European EMA approved single-use, fully-disposable, mechanical delivery device for both basal (background) and bolus (mealtime) insulin.

V-Go is on the market and generating meaningful revenues for Valeritas. Though not yet profitable, I believe Valeritas is headed in the right direction. The company recently undertook a restructuring to streamline operations and improve profitability. With improved efficient and focused promotion, I believe Valeritas can achieve breakeven operations in the not too distant future. In the meantime, the company is reasonably valued based on the revenues today and has tremendous upside as V-Go ramps over the next few years.

Given the increased attention to the rising cost of healthcare and the aggressive pricing strategies of many specialty pharmaceutical companies, I thought it important to focus this article on how Valeritas is bucking the trend with V-Go. Yes, V-Go is a disposable product and does cost Type-2 diabetics an out-of-pocket expense each month; however, independent and company-sponsored data suggests that the overall cost to use V-Go is nearly identical to insulin pens and injectors. Additionally, because V-Go potentially delivers better long-term glycemic control, it may end up saving patients tens of thousands in chronic care costs.

Thursday, September 29, 2016

Five Small Cap Names That Should Get Acquired

Last week, I read an article in the Wall Street Journal that highlighted renewed interest in acquisitions of small biopharma companies from "Big Pharma" players. The author of the article noted that, "Drug companies are starting to open their wallets again," and that this was a good sign the outperformance of the biotech ETFs, such as the XBI and IBB, would continue. The article was written the day after Allergan (AGN) announced two acquisitions on the same day, both targeting small-cap companies with proprietary drug candidates for the treatment of NASH.

Big Pharma's propensity to "buy" and not "build" is a major reason why investors flock to risky small-cap biopharma stocks. For example, investors in Tobira Therapeutics (TBRA) woke up to an astonishing 750% return thanks to Allergan's intrepid acquisition. Last month, a former BioNap favorite, Cynapsus Therapeutics (CYNA), agreed to be acquired at over a 110% premium. Good luck making those kinds of return in one day investing in Pfizer or Sanofi!

And speaking of Allergan's former merger partner Pfizer, they too have been aggressively spending money. In April 2016, the company won the race to acquire Medivation for $14 billion. According to the WSJ article, Pfizer and Allergan have spent a combined $20 billion since their $150 billion marriage fell apart in the second quarter. Other big pharma companies like Gilead and Sanofi are loaded with cash and obviously on the prowl. Gilead raised $5 billion in cash earlier this month by issuing senior unsecured notes at impressively low interests rates. Earlier in September, Sanofi issued $3.3 billion in debt at essentially negative rates.

Low interest rates, dwindling innovation in pharma pipelines, and the recent deal flurry from cash-rich large cap companies made me think - What are some small-cap healthcare stocks that could be (or should be) on the list of potential take-out candidates, if not today, then at least at some point in the not-to-distant future?