The waiting game
The tables are clearly stacked against small biotech companies developing cancer drugs. History has shown that few (if any) have successfully had the Food and Drug Administration approve a late-stage cancer drug. While mid-stage trials of Galena Biopharma's (NASDAQ: GALE ) HER2-targeting breast cancer vaccine have been promising thus far, the chances of an approval seem a long way off.
In phase 1/2 trials the recurrence rate was reduced to just 5.6% in the NeuVax arm compared to a 25.9% recurrence rate in the control arm after a 60-month period. However, the split patient pool for these vaccines was relatively small (187 people) and it will take an additional three years to determine whether NeuVax meets its primary endpoint of disease-free survival once the phase 3 study is full. Including an FDA panel review and FDA PDUFA decision, we could be looking at 2017 before NeuVax even has the slightest chance at hitting the market.
Also, nearly Galena's entire pipeline is made up of some trial involving NeuVax, so a failure here could be a potentially big blow to shareholder confidence. This is a situation where I'd like to believe NeuVax could succeed, but there are viable reasons -- and a three-year wait -- to believe that this valuation is far from deserved."
--- good read
Sentiment: Strong Sell
I will intentionally ignore the fact that you are simply regurgitating somebody else's work - poor at best - but what should one expect otherwise, right?
First problem here is the assertion that the patient pool of 187 people is small and therefore not substantive. In fact (verifiable by simple research) average phase II testing of drugs, on patients, to assess efficacy and safety in therapeutic doses, is anywhere between 100-300 patients. The purpose? To determine whether it can have any efficacy. Galena has already proven its potential worth in this regard.
My second issue is this: "Including an FDA panel review and FDA PDUFA decision, we could be looking at 2017 before NeuVax even has the slightest chance at hitting the market." This one is easy...it's pure conjecture. We have historical evidence that some drugs aren't required to wait out the completion of Phase III studies. However, it seems to me that longs aren't even really concerned with the time frame, having the patience to wait and see its passage into the market done the right way.
I'm not one to complain around these parts and I do enjoy (mostly for entertainment purposes) the back and forth between intelligent parties from both sides of the table but this garbage is easily refutable and fairly transparent. Someone wanted in at a discounted price because they have faith in the science and management. What's more, its likely that shorts saw (rightly so) the opportunity to make a profit from such an occurrence and did so.
Nothing regarding the company has changed - the only change in the game that I can see is that naysayers are quite literally out of ammo with which they can assault the company's strategy. Put simply, the negative energy simply isn't even trying anymore. You know what the trend is and you want to sway people who are easy converts. Hell, in the end, you're only serving the long interest because one all the weak hands are out, you will have nobody to pray upon! :D
Hell, in the end, you're only serving the long interest because once* all the weak hands are out, you will have nobody to prey* upon! :D At that point, once you cover you push it up higher and make everyone just a little bit more money.