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Keryx Biopharmaceuticals Inc. Message Board

  • ockerfan ockerfan Nov 9, 2013 12:20 PM Flag

    What AF doesn't get about PA -21 vs Z

    One of the stupider points that AF makes: "If Z is so great, why did Fresenius choose PA-21?" The problem with that question is that it is being asked today and not when the choice was made. In 2005, when Keryx in-licensed Zerenex (from Panion for about $5 mi.) both Z and PA-21 were iron based phosphate binders being tested for entry into a crowded field. The market was owned by Renagel/Renvela. Fresenius/Vifor as well as KERX were both looking to grab a small slice of a market that appeared to be growing. Sales were $6-700 mil in US and a similar amount in Europe and everyone knew that there was lots of switching among phosphate binders because of issues: pill burden, compliance, gi, calcium build-up, etc. KERX figured it could maybe grab 15% and have itself a nice little 100-150 million business in a few years time with hope of moving the needle if they were able to reduce pill burden and improve compliance. Fresenius was thinking similarly -- they already owned Phoslo, the generic and they wanted a tuck-in with a differentiated delivery mechanism (a chewable). As the two companies advanced their trials, neither was looking for iron advantage. Look at the early trial parameters and you will see. But lo and behold, Kerx saw an iron advantage -- first in the U.S and then in Japan. It was not planned. It was not genius. It was a surprise -- the same way that Viagra was discovered -- an unintended result. The gutsy move that Bentsur and Tarnok deserve credit for is taking that result to the FDA and seeking inclusion of iron paramaters as clinical endpoints. Failure might mean a complete setback, but success would mean a much broader application and an entirely different label. And it worked...better than anyone could have imagined. Does AF doubt that Fresenius would give its right eye to have chosen Z over PA21 today? Its like buying two pieces of property in the same neighborhood, excavating on both, only on one property you strike oil -- KERX's property!

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    • The Best-Performing Biotech Stocks

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      LDRH LDR Holding Corporation 532.4 17.1 #N/A
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      DXCM DexCom, Inc. 2,359.0

      Sentiment: Strong Buy

    • Ockerfan- thanks for your efforts here. What is a your opinion for a realistic buyout price for Keryx and do you think it will happen before or after FDA approval?

      Sentiment: Strong Buy

      • 2 Replies to kerx_investor007
      • Just adding 2 cents, but I do not believe any CEO from big Pharma is willing to gamble
        E over 1 B on buying a company with one drug and no FDA approval. This no doubt will happen and company will have to pay a greater PPS but it will at least be a safe move. With Keryx it returns to the same thesis and that is Patience will be rewarded. Shorts will dip and flip, and stock will be manipulated but eventually continued price rises will exit many shorts and players and stock will quiet down. Remember this stock has risen from 3 to 12/13/14 in a relitively short time. This will continue and big jumps will come on Japanese approval and payment of $70M and on eventual US and European approval. After US approval Keryx will be in play and bidders will come forward including, my belief, of a hostile attempt especially if it appears Zerenex will have over a 1B potential. Then the big boys will have an approved drug and a company who has always wanted to be bought out and in relative terms not a lot of cash on hand, even with Japanese payouts. As with every thing on this Board this is just speculation, but done with some semi intelligent thought. Finally this is as safe of a bet in the biotec world as you can get but until FDA approval shorts will play and potentially play very recklessly. Stay LONG and be PATIENT.

        Sentiment: Hold

      • I think that there are only probably half a dozen or so companies for whom this acquisition makes perfect sense -- companies that already have a salesforce with a current call on nephrologists. Some of those companies are going to want to wait for an approval before stepping up. But I would not be surprised to see one or two come in before then. Kerx has disclosed that it has had discussions with multiple parties who have expressed interest. I believe them. It makes sense that the major players would be all over this, if only to protect their existing franchises. The recent news has to have increased that interest. Still, I would expect that unless their hand gets forced by a process (which I would not recommend) or by someone trying to make a preemptive bid, a rational bidder will want to review the full P-II dataset, and perhaps wait til they see Japan approval or learn about the results of the end of Phase II FDA meeting before they make a formal bid. I would not be shocked if something happened before year end, but I think there is a much better chance for something in Q1. Other than having this finally over (I have been in this stock for a long, long time) i am not really sure I want a bid -- at least not yet. If a bid comes soon, I think the value will have to be solidly in the 20's now given the extremely positive news of the past week, I truly believe that in a couple of years time, this stock could be trading at a multiple of that, which is why a company will probably step in long before that. The results reported this week in both the P II and in the compassionate use extension trial are gamechanging in my opinion.

 
KERX
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