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Genta Incorporated Message Board

  • wildwoollyworld wildwoollyworld May 1, 2004 12:13 PM Flag

    Is GNTA Still A Good Stock?

    If yer in around 9.00

    Post thoughts, please??

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    • IMCL is 66 now. You did not make mistake.

    • Everybody make mistake. Remember Fen Phen? Aventis has its share of mistakes.

    • I made an error in my last post when I said IMCL was still trading below BMY's cost basis of $70 per share. That is obviously no longer a correct statement but the underlying point of the post remains the same.

    • Since you questioned me about why AVE would invest, thereby suggesting it somehow validates the drug would prove efficacious, I thought I'd give you a few exmaples that shows such investments cannot be construed that way.

      Here are a few examples of big pharma investments in investigational drugs that have not panned out as investors expected.

      * - AVE'S investment in VPHM's Picovir that was shot down by the FDA in early 2002 with the agreement subsequently being terminated.

      * - GSK's investment in Coulter's Bexxar, which initially received an RTF from the FDA and was subsequently given two "Complete Response" letters before eventually getting approved (the time from the initial BLA filing to eventual approval took over 3 years).

      * - BMY's investment of close to $2 billion in IMCL's Erbitux (given an RTF by the FDA). Even with Erbitux now approved in both Europe and the US, IMCL is still trading over 17% below BMY�s cost basis of its investment of $70 per share.

      * - NVS� investment back in 1997 to acquire rights to TTP�s schizophrenia drug Zomaril. It has since withered on the vine.

      * - Roche�s collaboration with MAXM back in 2000 for the co-development of MAXM�s Ceplene for advanced metastatic melanoma that was shot down by the FDA with the agreement subsequently being terminated.

      * - ABT�s investment to acquire the worldwide sales and marketing rights to SUPG�s Orathecin in December 1999 only to terminate the agreement (and thereby negate almost $60 million of potential milestone payments to SUPG) while Orathecin was in Phase III studies.

      * - LLY's investment of several hundred million dollars in ISIS' antisense drug Affinitak, which failed to show a survival benefit in its pivotal trial in non small cell lung cancer patients.

      * - GSK�s investment in IMGN�s Tumor Activated Prodrug, huC242-DM1, in which GSK abandoned the drug�s development after disappointing early stage clinical results and returned full product rights to Immunogen for no compensation whatsoever.

      * - SGP�s investment in British Biotech�s (merged with Vernalis) oral matrix metalloproteinase (MMP) inhibitor, marimastat. Marimastat�s pivotal Phase III trial in gioblastoma failed.

      Similarly, Biogen and Icos have halted their work on leukocyte function-associated antigen-1 (LFA-1) antagonists after failing to see efficacy with a lead candidate.

    • jpm_ventures,

      1. <<"How many MM drugs that have shown "promise" have been rejected in the past 5 yrs?">>

      Well, the blatantly obvious answer to that question is SGP's Temodol. SGP sought approval in first-line treatment of malignant melanoma. The pivotol trial failed to demonstrate a statistically significant survival benefit but did show some encouraging improvements in secondary endpoints like ORR and PFS. The FDA rejected it in 1999.

      But I know I discussed the temozolimide precendent and, predictably, was accussed of twisting and distorting facts. Go figure. But I think that pretty much answers your question does it not?

      2. <<"Why would Aventis invest?>>"

      I've also discussed this at length. I've repeatedly stated investment by big pharma is in no way an assurance that a drug will prove efficacious. AVE invested becasue (i) the were undervalued and had a weak pipeline, and (ii) they felt Genasense had promise. But because they invested does mean it wil pan out. But if you want, I'll site for you examples of investments by big pharma that didn't pan out as expected. I'll do so for you in my next post.

    • as I said in laboratory it worked great said Aventis but not in humans

    • How many MM drugs have been rejected in the past 5 years?

      I think Aventis did enough DD on Genta before they dropped all of that cash, Aventis could of picked any small biotech company but they chose Genta for some reason

    • simple: histologically it worked great but not in tissue

    • Yes it is still a good stock and it depend how much you pay. It is hard to say until next week

    • That's the most important questioin every shareholder needs to be asking themselves this weekend. At its curent price, GNTA has a market cap of about $670 million. Is that value fair or is it too high or too low? Here are 5 quick things I'd consider.

      1. If they fail to get approval in melanoma (which I have always felt was extremely unlikely and is looking more so today than ever before), there is no near-term milestone payment forthcoming from AVE. With about a year's cash on hand at current burn rates and a further decline in the PPS if and when a formal FDA rejection is announced, there will be further dilution.

      2. If GNTA shareholders have learned nothing else in this fiasco they should have learned that, absent hard data to the contrary, you don't easily reject the null hypothesis and assume a drug has efficacy. Genta has two completed Phase III trials in CLL and myeloma, both of which have had more than sufficient time to mature and both of which remain inexplicably shrouded in secrecy. The only rational conclusion to make under such circumstances is the drug hasn't shown efficacy in those settings. The burden is on Genta to convince investors otherwise, and the only way to do that is to release the data. Until that occurs, a prudent investors accepts the null.

      3. ASCO is coming up but GNTA only has two abstracts being presented. Contrary to what you'll see hyped on here, there doesn't appear to be any "blow-out" release of data coming at ASCO.

      4. AVE has not put its money and muscle behind large scale trials in solid tumors - nor have they filed for approval in the EU on the strength of the melanoma data. Thus, they obviously have chosen to wait this out before committing further resources.

      5. In light of the manner in which Dr. Warrell has portrayed the melanoma data package to the investment community, a rejection here will severly hurt his credibility. Once burned, investors won't rush to take positions in GNTA again just because Ray says he has a very compelling data package. Investors can easily forgive a biotech for a failed trial - happens all the time and is part of the landscape. But once a CEO's credibility is lost, its extremely difficult - if not impossible - to regain. Investors will likely only return to GNTA in a meaningful way again after a favorable ODAC reccomendation or FDA approval if this gets rejected.

      • 1 Reply to the_gnta_cult
      • Another follow up poont worht considering.

        Genta has no pipeline products. Its future - and existence - rest squarely on Genasense. There is nothing else even close to being in the clinic, and Ganite is being shown to be the inferior product most people knew it was all along.

        So based on these factors, I feel a ~$700 million market cap is still quite rich for a business in Genta's situation.

        You obviously need to make your own decision and I wish you the best of luck in whatever you choose to do.

        P.S. Just for the record, I have not been short GNTA and have not profited by one dime from the decline in PPS. I don't wish any ill will on Genta Corp. or any GNTA long. I just enjoy following the sector and think investors that read these message boards would be grossly misled and ill informed by only being exposed to the often ludicrous hype some put forth.

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