When Encysive was sold to Pfizer in 2007-08, they had hired Morgan Stanley about more than six months earlier to explore options. As revealed in SEC filings: 1) send out over 100 pitch books to prospects; 2) dozens of prospects respond, some asking for additional information; 3) about 12 companies signed confidentiality agreements, entitling them to examine in detail all the trial data, patents, and other pertinent information in secure rooms. In the case of Encysive, secure locations were in Houston and London. 4) First round of bids solicited, followed by 2nd and third rounds, until two or three bidders were left.
Since PHS has enough cash for up to a year, they may take their time finalizing a deal.
If stem cells can help the patient profiled on CBS, who had his injury April 2013, think what can happen with a recent injury patient injected with stem cells. It is not surprising that sensation in Jason's lower extremities is showing more gradual improvement: the feet get the least amount of blood supply.
The market is asleep as to STEM's potential. At a past conference management indicated that stem cell injections are active for at least six years. Why does the market expect an overnight cure when gradual ongoing regain of muscle function is big news? Athletes often have surgeries that sideline them a year or two and that is accepted. Years ago I had detached retina surgery in Chicago. The first operation was unsuccessful, the second one did not appear to be successful. The day before I was to leave for a retina clinic in Boston, my body decided it was time to work its magic. My retina was detached for four months, but I did regain useful sight in the affected eye.
The six patients had older injuries, yet still improved and may for years to come. The new patients coming into the study will hopefully include ones with more recent injuries and be better candidates.
XOMA has a track record of getting deals done: Agenus, Novo Nordsk, Novartis.
(From XOMA website)
"Given XOMA’s focus on endocrinology, we have decided to stop all gevokizumab related development activities and is initiating a formal sales process for the asset. As a result, the Company is closing the Phase 3 program in patients suffering from pyoderma gangrenosum. A preliminary review of the data from the approximate 25 patients enrolled in the trial to date did not show a clear signal of activity in this indication. XOMA has been approached by several companies interested in gevokizumab and data from all gevokizumab studies will be available to potential buyers.
There is a high probability that most of the patients will show continued gains between 6 and 12 months. The stem cells are waking up the body's healing process. These patients are young and better able to improve. I had a friend in his late 60s who had a foot drop from a spinal injury. He thought he would never recover, but he did-fully, in his early 70s. Youth may be wasted on the young, but not in spinal injuries.
The amazing thing is the patients had injuries years back. In the future stem cells may be injected within months or even weeks of a spinal cord injury.
When the S1 came out and the 12-month results were delayed I contemplated bailing. Why wasn't a deep pocket player partnering with STEM. Why did the former CEO "retire" on the cusp of great things? The news stories coming out were VERY optimistic. The company said stem cells had a life of at least six years. Who would have thought that young 6 month patients lost ground at 12 months! I can only speculate that their bodies' natural defenses were turning on the stem cells.
STEM, please do not take the foolish path of many microcaps in trying to go it alone. Get a partnership NOW with ample upfront money and the partner paying all future costs. If you have to, make it a 50/50 split. Shareholders will be richly rewarded.
With a prominent partner and positive study results in late 2017, the FDA could forgo a phase 3 study and invite STEM to file for approval. The lobby for paralyzed Americans is large and influential.
According to STEM's website they have licensed their technology to heavyweights Merck and Pfizer. STEM is ripe for a big deal.
All previous years' sales are negligible.
Xoma's library is a huge asset and more deals could be on the way. When a company has imminent news or important discussions an earnings conference call is usually omitted.
My CONS: 1) If results were outstanding STEM would have issued an immediate PR instead of waiting for the quarterly CC; 2) some of the participants, identified in news stories, have undoubtedly been contacted by big players. Why has not the stock price jumped big?
PROS: 1) STEM has promised to present the data at a June conference; one rarely does this for truly bad results; 2) STEM may be letting potential partners see the data first. This is permissible if the likes of Merck or Pfizer sign confidentiality agreements.
With decent 12-month data STEM could explode like CLRB today. STEM volume is modest today, partly due to shorts not wanting to cover en masse and run up the price. Better than expected data next week could cause a short squeeze.
Releases very promising reports, but issues an S-1, as if they are not going to find a partner to fund the $40 million study. First quarter conference call is way late.
Xoma's library contributed to the success of Lucentis and Cimzia. With 60 licensees one never knows when we wake up one morning to the news that Xoma just got another milestone check.
The 120 day questions obviously are softball lobs; otherwise, why would SNSS add a clinical VP? This stock has been beaten down incredibly, as has dozens of micro biotechs. Future partnerships are likely, possibly with current collaborators Biogen Idec and Takeda.
One of the directors recently bought stock on the open market per SEC filings. Sunesis partner Takeda has recently been doing a lot of deals. Usually after ASCO in Chicago, new deals are struck. Many potential European partners for Vosaroxin are in Chicago.
At least the S-1 apparently gives individual shareholders the right to buy into any future stock offering without any warrants attached. I hope a positive 12-month PR doubles the stock price before pricing of an offering.