Perhaps I just need to vent some. Here are a few things that upset me and that putting belief into probably cost me some serious money. Sorry to my fellow longs, but I have to call this like I see it. I may write a post on positives after this, because I do think there are some of those as well.
After approval (a few CEOs ago) there was an earnings call which discussed parallel plans of attack. Plan A, sell the company. Plan B, go alone. Preparations were going to be made for B, although A was the preferred plan. There was a slip of the tongue where "options" plural was discussed with respect to plan A. It was pretty clearly indicated that there were multiple interested parties in acquiring the company. Pre-approval for K, which was widely anticipated SVNT was around $15. Jumped into the low $20s because of the anticipated buyout. "No Deal" Stock tanked. Still not clear what the interest level was at the time. I think there may have been offers in the high teens which were rejected. How stupid does that look now? Guess what else. Plan B was a total bluff. There were virtually no preparations being made to go alone. This was admitted later and given as an excuse for a slow start.
After speaking about "No Deal", they discussed the prospects of going alone. They acted like they were prepared to do this and that they anticipated demand for the product. I remember distinctly a comment made about how many thousand people had signed up for the trials (I want to say 6,000, but maybe it was only 3,000). I got the impression that these folks would become patients almost right away. It was really unfathonable to me that the first quarter where K was available showed only one or two patients, and the next wasn't much better. Even now we are only looking at a few hundred in any given quarter. I honestly was anticipating the first full quarter of sales to be around $6 Million. We still haven't hit that years later!
Allow me to continue...
As I was saying, they never offer firm guidance, but the vague guidance they gave has proven completely wrong in a very, very short period of time. No double digit growth. No growth in accounts. No growth in patient counts. It's absolutely terrible.
Partnership in the EU. This is the one that cost me the most. LF spoke about "an exciting couple of months" last year in about August. He said that he anticipated a partnership in place before receiving EU approval. There was said to be interest from a number of parties. What happened to that? Approval came and went. LF said that the approval had generated new interest (that always seemed like complete BS to me because the approval was almost a given). Then LF talked about getting it done by year's end for a launch in the first Q of this year. Then even if it was early 2013, that would be OK. Then, they "reserve the right" to go alone if they can't get a good deal. Well, the launch was supposed to have happened by now and there is no partner in sight. LF says they need to hear from NICE. Did they not know that guidance from NICE was going to be important last summer when they led everyone to believe something was imminent. LF could not have been more misleading about this last year.
Now they act like the long term plan is price increases. Look, that hasn't been the plan. That might be the plan of the moment. It is the plan of last resort (it shouldn't be, they should have just sold the company). It will impact the bottom line, but without sales growth it is very hard to see how that will work unless they become even more agressive and the payers continue to pay even with a five to tenfold increase.
The problem now is that there is no reason for any investor or potential partner or suitor to believe almost anything they say. That is a problem of their own creation. It isn't good business to lie like crazy over and over. Especially about things which will come to light. Soooo stupid.
Thanks for venting for all of us. Once again you've hit this post out of the park! All the things you remember, the milestones, things Mgmt has said, I remember them all the same as you've written here.
It does seem at this point that Savient has managed to lose the trust of the entire pharma investment community - USA, Europe, worldwide, etc.. No one can believe a word this Ferari character says now. At this point I really think Savient cannot not grow sufficiently on price increases alone - and yet that seems to be all Ferari's offering in the short run (2013 - 2015). Saying that the drug works so good the pt is off of it as fast as new pts start. And saying they never give guidance on Pt numbers or accounts - what a scam! What business can get away with keeping that from their investors while the sp goes in the toilet?!!?!? And I think our only hope going it alone is for multiple partnerships - Europe, Asia, S America, etc., and this obviously is going to take considerable time. I can wait if they'd just start getting real and telling the truth that we need and can plan on as investors, instead of this Qtr after Qtr dangling the carrot. Enough - starting to foam at the mouth. Good night.
number of accounts and the number of patients from the various accounts., and thus, no one's stepping up to Partner or Buy. All the information the Ferari i
With sales bad and investors skeptical about the size of the market, Savient management began to publicize patient population. Initially they spoke about 170,000 patients, but people were skeptical. I believe the FDAs number was 90,000. Well, people were skeptical. So they commissioned a study from an "independent" firm and came up with the number 120,000 for RCG patients who would be eligible for Krystexxa. John Johnson reiterated this number when he became CEO. So did LF. They POUNDED the 120K patient number (US only) and then began more recently discussing 500K to 700K additional patients through label expansion. I can't tell you how often they stood behind this number that no one believed. Until now! Now LF is saying maybe half. Well, actually that is still more than enough... if there are 60K patients, perhaps you should be more candid about why you are only treating about 250! It really ticks me off. They should actually have some sort of grasp on the actual patient population. I don't know if there are patients and they just are just really terrible at reaching them (probably a big part of the truth) or if the patient numbers they tout are just completely false. They need to speak to this.
Well, to slow the path to bankruptcy, a new plan was put in place. Cut costs. It was stated this would not impact the sales. It obviously has. Obviously.
Price increases won't impact sales growth. Hard to say for sure, but sales have totally slowed.
Anticipate "Double digit growth quarter over quarter". It was stated after a 30% growth quarter and sort of in a way to lead people to expect growth similar to that 30% number, but safely at least 10% growth. We were told to expect growth in the number of accounts and the number of patients from the various accounts. The very next quarter we were told that the number of accounts was going to stay about the same going forward and that they weren't going to report it. They never offer firm guidance...
why so surprised?? Been telling you that all along. K is an IRRELEVANT drug in a marketplace so MINISCULE... whats so hard to understand?? Coupled with the fact this is a biotech company from Jersee (where there are ZERO bonafide companies) = Bankruptcy. The pps been telling you that for days, but your HOPE got in the way.
absolutely correct i went nuts ranting and raving the other day on these exact points .yes yes yes.bravo i vented in a different way than you are..but same issues ticked me off.thak you for anothe rlucid thread here.bravo