It would be nice if the MDVN news was behind OGXI's plunge because if so it would be a case of the market behaving irrationally. Xtandi joins Zytiga and Provenge in the pre-chemo space, and may be the best of the three, but while all of them delay the cancer's progression none of them is a cure. Patients eventually progress to the stage where the indicated treatment is chemotherapy. One or two CCs ago Scott Cormack cited statistics showing that the number of prostate patients getting chemo has not decreased since Provenge and Zytiga were approved for pre-chemo patients, and the same is likely to be true for Xtandi. In fact, just as OGXI is testing a combination of 427 and Zytiga in pre-chemo patients, it's possible that it and Teva could test a combination of 011 and Xtandi for the same population because 011 has been shown to synergize with Xtandi preclinically (see OGXI's presentation at ASCO in 2011 or 2012).
So most likely the plunge is due to something else. Maybe it's just some institution dumping losers at the end of its fiscal year as ubuy2ron has suggested. Of course, the worst possibility is that negative news on SYNERGY has leaked. Can't rule that out, but the stock was tanking almost as badly leading up to the Q1 CC in May and that was the call in which Cormack announced that 011 had survived two futility trials in SYNERGY. So who knows what's going on.
"One or two CCs ago Scott Cormack cited statistics showing that the number of prostate patients getting chemo has not decreased since Provenge and Zytiga were approved for pre-chemo patients, and the same is likely to be true for Xtandi."
Xtandi seems to be more effective than Zytiga. The question is, how much longer might it defer the need for chemo? I don't think the selloff (or bear raid) is irrational behavior. The market simply hates uncertainty.
"In fact, just as OGXI is testing a combination of 427 and Zytiga in pre-chemo patients ..."
Synergy between 427 and Zytiga would be great as it could create a halo effect - implying synergy with Xtandi.
".. , it's possible that it and Teva could test a combination of 011 and Xtandi for the same population because 011 has been shown to synergize with Xtandi preclinically (see OGXI's presentation at ASCO in 2011 or 2012)."
That would take time and money, neither of which would help the stock price any time soon.
Since I've never been an avid believer in 011, today's news didn't shake me out or change my initial investment thesis. Nevertheless, despite Xtandi's potential to dominate the pre-chemo prostate cancer space in the foreseeable future, I believe good news about 011 would still significantly boost OGXI's share price by validating OGXI's pipeline the same way Kynamro turned ISIS around despite the treatment's limited market potential - assuming that, as has already been noted, not too much dilution happens along the way.
Here's what's occuring... street analysts models are coming down on the total addressable market for pre-chemo prostate cancer patients. Per Cowen: " Based upon the results of PREVAIL and Xtandi's convenience advantages, we continue to expect the drug could capture 50% market share in the pre-chemo mCRPC setting. However, in our view, the U.S. market for pre-chemo mCRPC therapies may be
smaller than some model (more like $2B than $4B), and as a result, we expect Xtandi to
struggle to meet sales expectations. We believe investors are best positioned on the sidelines
pending greater clarity on the size of this commercial opportunity."
OGXI is getting worked on two things a) Xtandi will be the dominant drug in the space and b) the space has apparently now shrunk in terms of patient population.
The great thing about the market is that NONE of the analysts research and patient population studies are in any way conclusive. OGXI will still trade higher next year into their Phase III data - unless mgmt decides to dilute shareholders once again with a capital raise for higher trial costs.
If expanded use is approved, would delay 011/chemo combo:
"With positive results from the phase III "Prevail" study, Medivation and Astellas will seek FDA and European approval to expand use of Xtandi to treat men with advanced prostate cancer who have not yet received chemotherapy. This so-called "pre-chemo" prostate cancer patient population has the potential to turn Xtandi into a blockbuster drug." (attributed to Adam Feuerstein)
Me thinks you got the reason for OXGI volume yesterday. What is interesting is that this confirmation has had no impact on MDVN's price the stock is off in the last 30 days. So someone leaked the results and investors sold off or shorted OXGI because trading in MDVN would get them jail time?