Geoff Porges should be fired by Sanford B. He slammed VRTX drugs with no viable or reliable reason and by ignoring the phase 2 data. It seems to me if in fact some of SB clients and institutions/hedge funds actually listened to this bozo they must have lost tons of money and must be mad as hell.
An underappreciated asset is the nature of the CF market and Vertex's relationship in it.
There are somewhere in the vicinity of (only) 70,000 CF patients worldwide and (probably) less than 10,000 treating physicians. While these may sound like large numbers, compared to other diagnoses they are relatively small. This "smallness" allows for great relative depth in the relationship between Vertex and individual patients and doctors -- depth of information about each other and depth of two way communication. Whatever clinical trials (beginning with Phase 1 but certainly expanding with Phases 2 and 3) that competitors undertake should be very "visible" to Vertex. The only real question is the degree to which the company is aware of this "asset" and systematically exploits it to expand their knowledge base. Furthermore, we should not disregard the limitations competitors face in recruiting patients for their trials given the "smallness" and Vertex's position as the "clinical trial leader of choice."
at this point in time gene therapy to treat cf is "blue sky research", various allele involved, a lot of basic problems have to be solved, will take +10 years to have a product in clinical testing.
The good news for cf patients is that the combo strategy - corrector plus potentiator - pioneered by Vertex really works. Kaleydeco und Lumacaftor are just the beginning, as Galapagos notes "there is room for improvement". Actually, I had hoped for much better data for the 809 combo. But already 661 will show better results and the preclinical data from Galapagos compounds indicate even better improvements. Vertex ought to look very carefully at these data and not rely on new approaches but to protect its cf franchise by best-in-class combos.
Hopefully clinical trials using VX 765 treating HIV infected patients will be announced this summer. I think Jeff Chodakewitz (an authority on HIV) being hired as CMO at Vertex at the time Warner Green published his work testing VX 765 in HIV infected human tissue was no coincidence. Now that thephase 3 809/770 CF data has been released, and is positive, Vertex will likely start advancing some of it's non-CF R&D pipeline assets as well, and VX 765 is certainly advanced far enough from a safety standpoint in humans to resume it's testing in this new potentially breakthrough clinical application. Warner Green said in interviews last December that Vertex was negotiating with his Gladstone Institute at UCSF to start clinical trials and estimated those trials could start in a matter of months. That suggests an announcement for those clinical trials may be announced very soon.
After expected pullback, will be in the mid to low 80's at which time will be a good entry point. Global instability from mideast could impact the entire sector this week.
I have been told by a pharma guru that when drug companies has real lead, they don't disclose it until they are sure about their progress to be well advance in the race. I am darn sure VRTX has cure for HIV and Greene work is credible otherwise would not have published in two esteemed peer review journals. I wish VRTX does something with VX 509. I am not worried about a death in phase II trial. RA patients are elderly and they have multiple medical issues and deaths are part of life. Drug can bring sustained revenue to VRTX in 2-3 years. I don't think VRTX is interested in anti-LINGO target for MS. I am looking forward to see 3 drug data for CF in coming years. Also would love to see a cancer drug ( hopefully T cell immunotherapy) in VRTX portfolio. Aurora kinase failed because of QT prolongation issues was a set back, just like Hep C.
Agree 100%. Selection of a 2nd gen corrector and start of clinical trials of triple combo will be another sp moving events just as the FDA marketing approval of 508 homozygote treatment. An optimistic disclosure of the collaboration with Greene and co. for HIV treatment using VX-765 would be a lifting event also.
The major risk is currently out of the stock after the 'binary event' . Those who sold their shares on the advise of Geoff Porges before the release of the binary event TRAFFIC/TRANSPORT data last Tuesday have sellers remorse. Those who bought expensive put options or shorted Vertex before Tuesday lost a bundle. Those who bought shares this past week and have some patience will IMO at least double their money over the next 18 to 24 months. Currently, it's relatively safe to be long Vertex and not worry too much about day to day price fluctuations. Each positive data release on 770 monotherapy and 661/770 and 809/770 ongoing trials, as well as news about the initiation of addition clinical trials for both CF second gen correctors and non CF assets, and news of sNDA filing and NDA filings for 770 and 809 will bring increasing price per share going forward from now until 809/770 receives approval next year. Then the market will reward the stock on a ten fold increase in revenue over the next two years. Enjoy the ride.
I think it was Q2 earnings call, not Q1, when Mueller mention gene therapy. In a year or two Vertex will have money to partner with, or acquire a promising CF drug companies.
In response to analyst's query into future drug research in the Q1 E CC, Peter Mueller mentioned that he is looking into gene therapy. He didn't specify what disease the gene therapy targeted at the time, but I suspected it was CF therapy by the context. A UK consortium is running a clinical trial since 2012. Bluemoon appeared to have succeeded in treating a rare disease using lentivirus recently, and Bayer also has committed to work with Dimension Th. for hemophilia A. I am certain that Vertex is intensely watching the development. As you suggested, Vertex learned an important lesson from Incivek debacle.
Worth taking a look at what happened to share price in May 2012 and April 2013 following similar 40%+ spikes. Share price doesn't move up as a step function but usually pulls back below the peak. Good luck
I agree on your timeline, but I just hope that VRTX has learned the HCV lesson and will proactively look to acquire potential CF competitors.
I liked the phase 2 result of their JAK1 inhibitor for RA. They still have not started phase 3. I would think that even if their potentiator is effective and safe it won't be out for at least 3 years and their corrector for 6 years. Their potentiator has to compete against the VX-661+Kalydeco combo for 551/508 heterozygotes.
VRTX is far ahead of competition, but midterm Galapagos/AbbVie may be a strong competitor, has promising preclinical candidates, Galapagos (GLPG) has an informative presentation on its website, worth reading
I think you are right in lightening up and waiting a while. big spikes like that induce sellers, not more buying. I've seen it before. The pre market price of 105 was the peak and that's all for this spike. It will languish or trend lower until something fundamentally changes now