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Synta Pharmaceuticals Corp. Message Board

  • jfk123_1 jfk123_1 Sep 23, 2013 6:28 PM Flag

    Let's cut to the chase - what are the real issues here and upside possibilities:::

    Issues:

    1) The company has hyped many times before and hasn't delivered a single drug into the market.
    2) The company hyped Ganet. late last year, and the June data wasn't as great as it had previously led the market to believe it would be.
    3) Ganet.'s main selling point was the following (from company's own documents) "by blocking HSP90, ganetespib is thought to reduce the ability of cancer cells to become resistant to treatment". This is seriously undermined when the company comes out in June and says that its drug does not show any improvement over the control arm in subpopulations of non chemo responders. We can argue about this point, but the chosen population for Galaxy 2 is by definition those patients least likely to become resistant to treatment. The great hope for Gantes. was to eliminate or seriously reduce chemo non-response.

    Upside opportunities:

    1) Enchant and breast, where we have indications of complete clinical response and restaging of cancer (but where we have a small and incomplete study and a rush into phase 3)

    2) Galaxy 2, where albeit for a smaller indication, we may have a viable phase 3 success and FDA approvable drug within the year

    3) Upcoming patent filings for new platform, where we will get an idea as to the defensibility, applicability and potential market sizing and scope for partnership.

    4) High short interest and hard to borrow interest rates, where continued share price strength above 4.50 leads to an increased incentive to cover. Short squeeze.

    As it is, the company probably made a mistake in pushing so hard on Galaxy and less so on Enchant, as it appears the mechanisms of breast cancer may be more conducive to offering exceptional disease inhibition and eradication results. But that is why the share price is at under 7 when it was at around 12 just nine months ago. So it offers an opportunity.

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    • And many investors were hoping that Ganet. would still have potential for testing as a monotherapy for lung cancer, and that was completely ruled out by the company in June, definitively. Note, that Enchant for breast is a monotherapy trial. All the more reason why the market went crazy over the disclosure in August of the complete clinical response and cancer restaging even in the study. There was no other drug involved, just Ganet. This is why the company is taking a big risk pushing forward with Galaxy and not accelerating Enchant. Also, the new platform goes the combination therapy route, which is great, but why not really press ahead in a major cancer market (Breast cancer), if your drug as a monotherapy has shown remarkable initial results? This can be seen as suspicious by some (i.e. shorts) for good reason. Personally, I would be really pushing the breast angle much harder off the back of the August news, prioritizing resource allocation to that programme. Why is the company not doing so? It is a good question.

      • 1 Reply to jfk123_1
      • Also, note that in the end July/August update, the company said that it was expanding the Enchant trial to test as a combination therapy. No one has asked the question why they were so quick to expand in this direction if in actuality a patient had been restaged and complete clinical responses seen in their initial small sample of subjects. Wouldn't it be smarter to try to understand why such a strong reaction as a monotherapy? And if such a reaction, why the push to expand the study in the direction of a combination therapy, unless the company didn't have confidence in the restaging event and the complete responses as anything but statistical outliers. This is part of why shorts hang around - management does have a record of very strange and less than transparent behavior. Hyping a complete response and restaging from monotherapy application, but then rushing into an expanding combination study.

        We still move up from here people, and the long trade is the correct trade to be in now, but it is no point to delude ourselves, there is a reason so many people are short. Qouthron_rip is just a fool, I ignore him, he would be short Apple in 2010. But there are intelligent shorts at play. They'll have to cover pretty soon, but this may be a case where after a nice run up - partially inspired by short covering - they may come back with force. Everyone remember DNDN? Shorts came back with a vengeance there. I am in this for the initial run up which may be quite extensive. But I won't be holding this with the crazy conviction of many if this stock gets into the 30's and beyond, unless management gets a bit more credible.

 
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