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  • m.dog92 m.dog92 Mar 12, 2013 3:32 PM Flag

    Savient appears to have weathered their self inflicted storm some of you should read this again!

    Okay, I’ll admit it. I’m your average dumb investor who’s the target of retail etraders. I will also admit that I’ve lost a lot of money in overly hyped pharmaceutical stocks, but I have fortunately made more than I’ve lost because I happen to have been in the right stock at the right time. There’s something about losing money on stocks that gives me as profound an education as any victory, and I’ve had plenty of losers to learn from. What being in the “RIGHT STOCK” has taught me is that if you own it, you can’t have enough of it. That brings us to Savient Pharmaceuticals.
    This ugly niece in the small bio-tech field has had a horrible, and for the most part self inflicted history. The only real triumph in their decades of existence is being able to get 2 drugs through the rigorous and sometimes questionable FDA vetting process. One drug
    Oxandrin gives its users the ability to gain pounds after unintended weight loss. That doesn’t seem on its face to ever be a winner and only Kool-Aid drinkers could make the case otherwise.
    Now let’s discuss the other approved drug, Krystexxa. This is a drug that was FDA approved for the treatment of gout in a variety of stages. I’ll admit that getting the numbers on market potential is tough, but as I will discuss, it may not matter in the end.
    Krystexxa works differently than competitive drugs at lowering Uric acid because it transforms it into allantoin, a natural harmless crystalline powder that passes harmlessly through the kidneys. This is significant because when Gout patients who also had Kidney disease were treated with Krystexxa, there was marked difference in the amount of Uric acid passing through their Kidneys. Uric acid will do a number on the kidneys if not controlled. Ideally you want as little as possible flowing through them because advanced kidney disease can lead to expensive, painful and time consuming procedures like dialysis which is always the last resort and guarantees a lower “Quality of Life” for the patient.
    Does anyone remember Viagara? This erectile dysfunction pill was designed originally to treat hypertension. Unfortunately, that proved to be a bust, however during testing and trials it was determined that the little blue pill did what it did. They reworked the paperwork to apply a new classification for the pill and voila!!! Pfizer, an already well established pharmaceutical company saw its stock soar.
    Krystexxa could well end up to be the Viagra of Savient. It may possibly even be better? Competitors in the gout treatment arena work by lowering the amount of Uric acid as a percent. They still allow unacceptable amounts of uric acid to pass through the Kidneys, though not as much. That is small consolation because every drop of uric acid that flows through an already compromised kidney is one step closer to dialysis.
    It turns out that if you can delay or improve the prospects for someone suffering from Kidney disease, and limit their need for dialysis you can save the healthcare system gobs of money. To say billions worldwide is not hyperbolic. No one with any integrity in Healthcare analysis thinks that austerity is not going to be in the cards going forward. That always makes for tough decisions as to where do you cut. These are people’s lives we are discussing.
    I’ve never been involved in a Company that was granted what is called “orphan status, Orphan status is a regulatory designation that states that your formula is so different and could provide hope for the hopeless, that we will fast track the approval. With Krsytexxa having already been approved for safety, and the remarkable side effect of converting uric acid to a harmless compound, I wouldn’t want to be a vote against if I were sitting on the approval board.
    It is a rare designation to get because to do so virtually guarantees a Company smooth sailing because it has no competition for its product. Krystexxa is currently undergoing some testing in Europe on kidney disease patients with impressive results. There is growing speculation that Savient will be granted ‘Orphan” status for the treatment of kidney disease and that could set SVNT stock into the stratosphere.
    With recent court rulings in Savients favor from disgruntled bondholders, and suspiciously in my mind, being magically able to renegotiate debt so as to give them enough cash by their estimation to last 2 years, it doesn’t take a genius-which I ain’t- to see that this could be an incredibly fortuitous time to own SVNT. To sell debt restructuring, you have to have something to sell. Savient still has some work to do, but every bit of information from the Company lately has seemed to be geared toward exploiting opportunities that weren’t even on the radar screen less than a year ago.
    Now let’s look at recent management shake-ups that seem to similarly want to take advantage of the recent turn of events. There could be great significance to the elevation of David Y. Norton to Overseas development. It may be a clear indication that the Company learned from its “go it alone” approach in the product launch of Krystexxa.
    Usually when the top dog leaves, it isn’t the most comforting news. However, Johnson did oversee a pathetic rollout, and the fact that he will now sit as the head of the soon to be defunct Dendreon, proves to me that Savient made the proper move.
    Nortons resume’ is about as impressive as it gets and his experience in Europe with Johnson and Johnson. He seems like a pretty serious guy. He doesn’t appear the type of person that wants to be the overseer of the decimation of a Public Company. His familiarity with Savient as a board member makes him a perfect fit if and when Krystexxa is approved for the treatment of kidney disease in Europe. How long do you think it would take to get a similar approval in the U.S. were that to happen?
    Savient appears to have weathered their self inflicted storm, and with still inexplicable Institutional support and opportunities that most bio-techs would drool over

    Sentiment: Strong Buy

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