Just got back from Spring meeting. The bags that were given to all the participants had an advertisement for Auryxia. The speakers in the areas of iron and anemia all shared my concern over the use of IV iron in both dialysis and non dialysis CKD. The awareness of the average nephrologist of the issue was generally low. I do believe that as the awareness grows, we will see increased use of auryxia. The speaker who I spent the most time with was cautious about both auryxia and triferric but, given that auryxia is easier to use and capable of use in dialysis and non dialysis patients, I do think that the thought leaders are going to study the use of auryxia as an alternative to IV iron. Of course they may look at ferrous sulfate also but no one in Nephrology believes this will work in hemodialysis patients who have ongoing blood loss and the vast majority of whom are on ESAs. A check of the DOPPS site will show there is currently very little use of the previously available oral iron products.
05/22/2015 TRx: 249 NRx: 199
In comparison, last week's were:
05/15/2015 TRx: 214 NRx: 165
Solid week! Wonder how Memorial Day will impact this week's numbers that come out next Friday.
- Keryx Q4 results announced Feb 25; Q1 being announced April 28 (2 months, not 3 months later)
- Departing Board Members leaving May 1
- No discussion of European Partnership since approval over six months ago
- Phase III results positive without a significant share price increase
- Label expansion to a large market of patients is just a matter of time
- No sales or marketing executives on Management Page of website (easy transition of leadership)
- Cash flow not an issue creating strong negotiating position
- Idenix went from 5-7 range in the month before being bought out (Baupost owned 35%) - Merck bought for $24.50
- Idenix had 85 employees, no product on market, and less than $1 million in revenue
- On Friday June 6, 2014 Idenix was $7.23.
- The announcement on Monday June 9, 2014 cost the millions of shorts over $1 billion
- Keryx has an approved drug and a start-up sales volume - 2016 guidance of $31-$34 million in US with limited coverage, inexperienced/independent sales force, and a slow transitional market. Label expansion and an experienced/connected sales force changes the revenue projection for 2017 to multiples of Q415 forecast for 2016.
- Short interest slowly declining (their upside is limited and downside is capped by the buyout price) - a painful loss
- Compare Idenix position on June 6, 2014 with Keryx tody and the road from $5 to $24.50 or beyond seems clear.
The puzzle is coming together!!!
Sentiment: Strong Buy
Thank you to keystone.investments from the AMRN boards as always for getting us the numbers! Down a little from last week's highs, but that will be the case from now until the New Year as people do their holiday shopping and more importantly, doctors that write the prescriptions also take some time off for the holidays.
TRx 368 402
NRx 193 223
This looks like a change we've been waiting for is coming, an unrestricted access by the biggest insurer. I'd expect this to be nation-wide policy. Oxford is United's subsidiary. This would represent an increase in part D coverage of about 22%, and 15% overall, to 80%, correct me if I'm wrong. If true, Humana should follow shortly, they also require PA, and have QL imposed. This would remove a major nuisance factor for docs. Maybe they announce it on the next presentation?
UnitedHealthcare Oxford December 2015 policy update bulletin
Auryxia (Ferric Citrate) Revised
Revised coverage criteria/precertification requirements to indicate precertification is no longer required:
o Removed language indicating precertification is required through the Pharmacy Benefit Manager (PBM)
o Removed prior authorization/medical necessity guidelines and corresponding reference link to policy titled Prior Authorization/Medical Necessity Guidelines: Auryxia
Effective Date: Jan. 1, 2016
I cant help me this is incredible.
It has begun as Greg Madison has vaticinared in many conferences .
Many formularies have switched recently from Tier 4 or 5 to Tier 3
AURYXIA IS NOW A PREFERRED DRUG
For all those shorting Keryx... THINK ABOUT IT
Prevea360 Drug Formulary Changes
Preferred 3 Tier Formulary
05/01/2015 AURYXIA TAB A Add to Tier 3
Excellus Blue Shield/blue Cross
Brand / Tier
AURYXIA 3 QL
calcium acetate 1
FOSRENOL 3 QL
QL = Quantity Limit applies
L.A. Care Covered Direct Formulary
Brand / Tier
AURYXIA TAB - 3
Horizon Blue Cross Blue Shield
AURYXIA - 3
DAKOTACARE Drug Formulary
PHOSPHATE BINDER AGENTS
lanthanum Tier 2 FOSRENOL
calcium acetate Tier 3 PHOSLO
ferric citrate Tier 3 AURYXIA
Sentiment: Strong Buy
Thank you to keystone.investments from the AMRN boards for getting these for us again! Also, as an FYI, I will be traveling next Friday and might not be able to post the scripts, so hopefully someone else can access them. Looks like this was a very solid week overall!
07/24/2015 234 160
Last week for comparison:
07/17/2015 199 127
JUNE 01, 2015
Pharma companies have long struggled to pen compelling value stories for their products. Could they learn a thing or two from the case Keryx Pharmaceuticals built for its renal drug Auryxia? James Chase reports
Download: Payer Pressure—Value-Able?.pdf
In November 2012 a New York Rangers superfan named Molly Heines successfully bid $66,000 at charity auction for a game-worn mask belonging to goaltender Henrik Lundqvist. How could a used mask possibly be worth that much money? The explanation, of course, is the same one the scribe Publilius Syrus offered to the world more than 2,000 years ago: because that's how much Heines was willing to pay for it.
In the pharma industry, the concept of value can be even more perplexing. For starters, it can mean something entirely different to each stakeholder, depending on the disease state and the market. What's more, it is measured using a bewildering mix of units—dollars, mortality, dosing, side effects, convenience and market share, to name but a few.
Nevertheless, as the healthcare landscape continues to change, the need for pharma to add, demonstrate and communicate value has never been greater. And this is where it gets a little challenging. This is an industry built on constants, not variables, one where tangibles eliminate surprises and where every action is quantifiable. But if developing and selling medicines is an exact science, the concept of value is anything but.
“For pharma and biotech companies today, value is no longer an equation but a multidimensional appeal to a range of stakeholders, who are more discerning than ever,” says Rita Glaze, EVP, director, US market access at Edelman. “The opportunity to look at value through a shared lens is exciting, but the challenge is daunting. The industry is grappling with finding a shared definition of value across stakeholders while delivering to investors and planning for investments in future innovation cycles.”
For his part, Greg Madison, president and CEO at Keryx Biopharmaceuticals, feels the landscape has changed significantly. “For years innovation was defined by big pharma as brand extensions and maybe subtle differences as a way to manage life cycles,” he explains. “Clearly, these days you can't get away with a me-too approach and expect to get the reimbursement that perhaps 10 years ago you could. Proving your value, in addition to the fact that [a drug] works and that it's safe, is critical.”
Although it might be a little harsh to label Madison as one of the aforementioned “grapplers,” he has certainly had his hands full since he took the reins of the Boston-based biotech in February—just weeks after its debut product Auryxia hit the market. “We didn't have time to do premarket development,” he says with half a smile. “We didn't even get the name Auryxia until November. Then we launched two months later.”
The fun, almost cartoonish scene he paints of Auryxia's on-the-fly scramble to market belies a truer picture—one of the smart, strategic course Madison is plotting to drive and demonstrate the value of this breakthrough pill across key constituents.
Approved in September 2014, Auryxia (ferric citrate) is a phosphate binder for dialysis patients with chronic kidney disease. While there are three or four existing competitors, Auryxia is the first and only absorbable-iron-based phosphate binder. (Dialysis patients are iron-deficient and typically receive intravenous iron or other products at dialysis to help manage their anemia.)
Patients, payers and providers
Many of these drugs come with risks of adverse events. But since Auryxia is absorbable-iron-based, patients require fewer injectables. And this, essentially, is what drives the product's true value across all stakeholders.
“Value, first and foremost, needs to go to the patient,” Madison explains. “It doesn't necessarily have to be a mortality benefit, but it's got to bring value to the patient in a significant way that makes his or her life better or more sustainable or durable overall.”
Auryxia creates value for the patient by, of course, limiting exposure to potentially harmful injectables. However, Madison points out that it doesn't make sense to communicate this value message directly to the dialysis population.
“It's much more important to go to the dialysis clinics themselves,” he says. “The doctor, the dietician, the nurses and the social worker—those are the four to whom you really need to drive the value message. The dietician sees patients maybe three days a week when they are in the dialysis chair, so they're the ones that get to know them.”
The value message to the payer is based on robust clinical trials data. In the case of Auryxia, it offered a compelling and persuasive story on two different levels. First, there was the reduction in the use of supplementary medications (such as IV iron and ESAs) during dialysis—not to mention the cost savings associated with this. Second, there was a 24% reduction in hospitalization for patients taking Auryxia.
Amy Sullivan, VP corporate development and public affairs at Keryx, notes that certain payers then took the clinical trial results and cross-referenced them with their own databanks to project potential savings. “One group calculated they would save about $1,000 per patient per year. Another factored in the hospitalization and found they would save $2,000 to $4,000 per patient per year. It's quite significant,” she says.
Sullivan adds that payers have generally been on board with Auryxia's pricing. “We entered at a price point that was, at the time, just a bit higher than the market leader,” she says. “And then the market leader took two increases, so we're now priced at a discount. So [payers feel] we've priced it responsibly, which is nice to hear.”
Healthcare providers, of course, are the owners and operators of the dialysis centers themselves. From a reimbursement landscape, the dialysis providers operate what is known as a bundle payment system, whereby they receive one payment each time a patient sits in the dialysis chair. That covers the dialysis itself as well as any injectables they administer, like IV iron or ESAs.
“They try to run a profitable business,” says Madison. “So from their perspective, we have a drug now that [reduces the need for the injectables]. It's a financial advantage for the dialysis providers as well … We've got a unique product here that aligns really nicely on the clinical side and really drives value across all the different stakeholders in this marketplace.”
Madison says the payers really represent the keys to the success of Auryxia. His objective by the end of the third quarter is to accumulate enough formulary wins to provide unrestricted access to 80% of the dialysis population.
To be continued
But the story doesn't end there. A Phase-III program is about to get under way for a new indication for Auryxia. Currently 70% enrolled, the trial will focus this time on iron-deficiency anemia (IDA) in the pre-dialysis population. “It's another unmet medical need,” Madison explains. “There are about 1.5 million patients with IDA and, really, the vast majority of those are not being treated today. The oral irons are not well tolerated and they don't work really well, and the only other option is the injectable iron that we already know has the potential for side effects and other challenges for the patient.”
If the trial is successful, the new indication could spawn another significant value story for Keryx. “The first year of dialysis produces the highest rates for morbidity, mortality and cost,” Madison continues. “When patients first show up for dialysis, they have low hemoglobin, low iron, high phosphorus levels and so on. They're in bad shape. Everything tries to get fixed at once.”
However, Madison believes Auryxia could provide a treatment option for patients in pre-dialysis to manage their iron stores and anemia. When they get to dialysis, then, they should be in a better physical state and might not need an injectable.
“It intuitively makes sense to fix all those things before they get there,” he says. “We just have to up the proof of that with data. But if that turns out to be the case, then you're driving incredible value across patients themselves, providers and insurance companies.”
Sullivan feels that there are lots of advantages to Keryx being a small company, particularly in development. “Small companies do things so much quicker and more efficiently than the big companies,” she notes. However, she has found the opposite experience to be true when negotiating with payers. “What we realized as a small, one-product company is that you don't have a lot of leverage in terms of timing. Bigger companies definitely have greater leverage in terms of importance on [the payer's] timetable. It's a double-edged sword.”
Madison agrees. “I'd rather be small. Every time stuff comes up, you can react, move quickly and go. But you just don't have the leverage behind negotiations, the ability to force timing. That's the harsh reality. You can't just go, ‘Hey, we're Pfizer, we have all this other stuff. We demand your attention right now.' ”
Another interesting piece in the value puzzle is the trend for companies to promote themselves as experts and leaders in their respective categories instead of marketing only their products. Keryx is fully on board with this approach and has already sponsored a number of community events.
“At this point, there really isn't a leader in the renal states because the big players like Amgen and Genzyme have backed away a little bit,” says Sullivan. “But our company really is focused on—and devoted to—bringing innovation to renal patients. We think it's been an underserved patient population for a number of years. So at the same time we are building the Auryxia brand, we're trying to do things with the corporate brand as well.”
THE VALUE-ADDED MESSAGE
It's one thing for a small specialty company to demonstrate value with a single breakthrough product. It's quite another for a established pharma giant to attempt to do the same with an entire stable of products. Enter AstraZeneca and its respiratory portfolio.
AZ has been in the respiratory game for four decades, but a spate of acquisitions in the past couple of years has underlined its intent to become the category leader. “We are dedicated to eliminating the burden of respiratory disease for current and future patients,” says Michael Austwick, executive director, US Respiratory Franchise at AZ. “Our strategy is to become an industry leader in -innovative inhaled and targeted therapies for asthma, chronic obstructive pulmonary disease and idiopathic pulmonary fibrosis by offering a diverse portfolio of respiratory products to meet the needs of patients across all phases of disease severity.”
The value message of the portfolio combines AZ's deep expertise in respiratory with the diversity of solutions available to patients. It also emphasizes the company's innovative technologies and products, both those currently available and those under development.
Adding to mainstay stablemates Symbicort and Pulmicort, AZ -recently acquired the rights to Actavis's branded respiratory business in the US and Canada. In the wake of the deal, AZ now controls the development and commercialization of Tudorza Pressair and Daliresp. The company is also developing a line of inhalation -therapies based on the Pearl products for COPD and asthma.
Meanwhile, two lead investigational biologic agents from AZ's MedImmune global
Sentiment: Strong Buy
One of the best articles so far dedicated to ferric citrate in a journal called Therapeutic Advance in Chronic Disease 2015 Sep issue; fulltext available free online.
"Managing hyperphosphatemia in patients with chronic kidney disease on dialysis with ferric citrate: latest evidence and clinical usefulness"
Conclusion: Based on the published data, ferric citrate appears to have a preferential place in clinical practice by virtue of its efficacy in the treatment of CKD-related hyperphosphatemia, and as an efficient mode of simultaneously loading the patient with iron in CKD-related anemia. Its efficacy and safety profile in patients on HD with hyperphosphatemia who require iron replacement has already been established. The major advantage of ferric citrate over other phosphate binders is that it provides simultaneous iron administration. This dual therapy in a one-pill form may render ferric citrate a preferred alternative to the use of sevelamer or lanthanum for hyperphosphatemia by avoiding or reducing the use of intravenous iron therapy for iron deficiency with its attendant risks and costs. The efficacy and safety of ferric citrate in patients with CKD not yet on dialysis and in patients with ESRD treated with PD appear promising but remain to be established with additional clinical trials. The use of ferric citrate in patients treated with HDF still remains to be studied.
With the fully diluted issuance of another 33+ million shares, Baupost now owns nearly 45% of the company. It also has a board seat as well as board visitiation rights. Though it only has one of 8 board seats, does anyone believe that a board would not follow the directions of a board member who controls 45% of the outstanding shares -- including demands about holding management accountable? Whatever bet you were making before is now a bet on Seth and his ability to turn this ship. With a Board seat, Baupost loses its passive status and must update all transactions in the stock on a "timely" basis. All that drivel about Baupost shorting shares that we had to listen to for months will now be put to rest as a Board member is not allowed to short shares or hold a short position in the shares. This was a major move by Baupost that fundamentally changes the company and its prospects. None of it changes what the drug will do, but for sure the company will have a full opportunity to explore the CKD application without running out of cash. It is tough to accept dilution at these levels and the issuance of senior indebtedness, but given the stock price and capital needs, the terms of this issuance are not as onerous as they might have been , and this is really the best option for the company : issuance of shares to a loyal and patient investor who will not lend those shares to the market for shorts to cover. I had sold most of my position at various levels over the past few months but have bought a bunch of shares today.. I think this should move the shares higher and position the company with better leverage as it negotiates the EU partnership and as it looks to negotiate with other potential players following CKD approval. Tough but smart move by the company and very smart move by Baupost.. JMHO
darrell franklin @VexImperfect 13h13 hours ago
Seems that the switch from renvela to auryxia an improvement. Phosphorus lvls lowest they've been since 2012. Less heat stress #stuckhere
Sentiment: Strong Buy
Not too bad of a drop considering it was pretty much a 3-day week! Thank you as always to keystone.investments from the AMRN boards for proving me the info! Also, I will be traveling next Friday and will not be able to post the scripts. Hope somebody else can.
Baupost accumulated upwards to 35% of IDIX stock before its buyout by MRK. On the day before the buyout announcement, IDIX was just another beat down stock like KERX is today and listed for $7.23 a share. Merck's buyout offer was for $24.50.
Baupost started accumulating KERX stock in the first quarter of 2014, increasing its stake every quarter up to and including the first quarter 2015, to where it now owns almost 22% of oustanding KERX stock. Based upon the average stock price for each of those quarters and Baupost's reported holding increases, I estimate his cost basis in almost 22 million shares to be about $14.
Two observations: One, substantial additional accumulation by Baupost of KERX is more likely than not at these low price levels. Two, a buyout price in the mid twenties for KERX should be a floor, with much higher prices likely. Why? While IDIX was just a promising clinical stage company in the Hep C space and was crowded with high powered competitors like Gilead, AbbVie and Bristol Myers Squibb, KERX has no competition in the renal space for an iron reducing, phosphate drug that is FDA approved drug with an expanded label likely that will triple its existing market.
Have a great weekend!
Q1 RIONA 936 mYen (7,57 mDollar)
Q2 RIONA 1285 mYen (10,39 mDollar)
Estimates Q2 Frankie 1120 mYen
2015 Torri 4620 mYen (1155/Quarter) = 37,34 mDollar (9,34 mDollar)
Probably Torri will raise the expections for RIONA. WHAT A GREAT DAY
Shorts are in big trouble
Sentiment: Strong Buy