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WGL Holdings Inc. Message Board

big_jake_ii 119 posts  |  Last Activity: Apr 23, 2015 9:42 PM Member since: Feb 6, 2008
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  • Reply to

    what bugs me is that

    by dfbcatalano Apr 23, 2015 10:42 AM
    big_jake_ii big_jake_ii Apr 23, 2015 9:42 PM Flag

    Ron stated that many times re the target market. He also listed the problems with the competition numerous times .

  • Reply to

    what bugs me is that

    by dfbcatalano Apr 23, 2015 10:42 AM
    big_jake_ii big_jake_ii Apr 23, 2015 9:36 PM Flag

    No ,not a medical expert, just a former pre -med major in college and a long term Kerx shareholder among other biotech holdings.
    ...and yes on the Duke's movie reference.

  • Reply to

    what bugs me is that

    by dfbcatalano Apr 23, 2015 10:42 AM
    big_jake_ii big_jake_ii Apr 23, 2015 11:43 AM Flag

    The expectations were for a slow a phosphate binder,there is established competition.
    Remember...CHRONIC KIDNEY DISEASE PHASE III results did not come out yet....European apporval did not happen yet. Our target market at launch date was newly diagnosed patients and patients who were changing phosphate binders due to some adverse reaction.
    "slow launch "has to be viewed in that light.

  • big_jake_ii big_jake_ii Apr 23, 2015 10:59 AM Flag

    You know that's NOT going to happen ,bro. This salmon has been swimming upstream since birth. Why should that change now?
    Thank God for Baupost or many more investors would have thrown in the towel already.

    Sentiment: Strong Buy

  • big_jake_ii big_jake_ii Apr 23, 2015 10:55 AM Flag

    Once on the formulary, Auryxia's tier placement is relatively unimportant. On the Part D side, most patients are on a two-tier co-pay system (brand and generic), regardless of the actual tier. And on the commercial side, Keryx's co-pay assistance program guarantees the majority of patients will pay no more than $5 for a prescription of Auryxia. Keryx can bring these savings, differentiative advantages and other information to the nephrologists and dialysis care team, which includes the dieticians, renal nurses and social workers, who can then identify the patients with the appropriate need and coverage.

    In conclusion, the likely favorable EMA and Part D formulary decisions will lead to a ramp up in sales during the latter part of the year. Therefore, the recommendation is to either skip till after Q1 earnings, or buy and hold for several quarters.

    Sentiment: Strong Buy

  • big_jake_ii big_jake_ii Apr 23, 2015 10:50 AM Flag

    In the meantime, investor focus will be on the Auryxia launch. For Q1 2015, consensus is $2.90 million in revenue. It is reasonable to expect $1 million in license revenue from Japan's third full quarter sales, leaving the rest for Auryxia. Assuming conservatively that target serum phosphorus levels are achieved at the initial regimen of 6 tablets per day, around 2,500 Auryxia prescriptions are needed in Q1. Since around 2,000 prescriptions are required in March (~500/week), the analysts' estimates likely won't be met based on current trends, which still show fewer than 100 weekly prescriptions in February. Of course, some patients will need the maximum 12 tabs/day to bring their phosphate levels under control, which would lower the prescription threshold.

    After Q1, the Q2 revenue target of $6.20 million (maximum 6,600 prescriptions assuming $1.2 million from Japan) should be easier to meet. In Q2, Auryxia could be accessible by more than 55% of individuals with Medicare Part D, which covers ~60% of dialysis patients. Currently, Auryxia is in formularies at 6 of the top 15 Part D payers (20% of Part D covered lives). On the commercial carrier side, which covers ~30% of dialysis patients, Keryx has already secured broad unrestricted access (no prior authorizations or step therapy needed) for Auryxia at the top pharmacy benefit manager, Express Scripts (NASDAQ:ESRX).

    Every plan is a little bit different, and Part D payers can take up to 180 days post approval or post launch to decide to conduct clinical reviews, formulary reviews, and/or contract discussions. Most plans will have a set formulary by April, but some have rolling decisions throughout the year. And then there's usually a gap between when a drug is added to formulary and when actual prescriptions can actually get processed at the pharmacy. But by far, the most critical component to Keryx's success is just to get added to the top insurers' formularies.

  • big_jake_ii big_jake_ii Apr 23, 2015 10:48 AM Flag

    Cash flows/expenses:

    Recognition of revenue generated by the Auryxia launch will be initially based on a sell-through method to the patient.

    The Japanese launch of Riona generated $0.57 million in license revenue for Q4, more than doubling the $0.26 million of Q3 2014. For Q4 2014, research and development (R&D) expenses decreased to $5.8 million compared to $10.5 million for Q4 2013, as inventory builds, which were expensed to R&D prior to approval, were shifted in the balance sheet into inventory. Q4 selling, general and administrative (SG&A) expenses increased to $34.1 million, primarily due to a one-time $10.9 million in stock-based compensation related to the Auryxia launch milestone.

    Keryx is expecting average R&D and SG&A expenses together for 2015 to run at about $30 million per quarter, excluding non-cash compensation. The consistent estimate is likely accurate; Keryx's current sales force of 60 reps call on the 5,000 nephrologists who write ~80% of phosphate binders prescriptions. Even if Keryx obtains a label expansion, the targeted kidney specialists will be same prescribers who treat pre-dialysis patients with IDA, so there won't be a real need to augment the existing sales team.
    Forward look:

    There are two major catalysts in 2015. The EMA decision on the Zerenex MAA as a treatment for hyperphosphatemia in dialysis- and non-dialysis dependent CKD is expected in mid-year. Due to the evidence of clinical benefit from multiple Phase 3 trials that led to approvals in the U.S. and Japan, Zerenex should likewise get approved in Europe. Later, a topline readout from the Phase 3 pre-dialysis IDA study is anticipated by year end. If the trial is successful, the data will serve as the basis for a Supplemental New Drug Application or label expansion for Auryxia. If approved, the new indication would quadruple the Auryxia market from the 450,000 dialysis patients to include more than 1.5 million Stage 3-5 non-dialysis dependent CKD patients who have IDA.

  • big_jake_ii big_jake_ii Apr 23, 2015 10:45 AM Flag

    What sets Auryxia apart is that, unlike the active comparators Renvela and PhosLo, absorbable iron from Auryxia can elevate patients' iron stores. In addition, other products have class-specific disadvantages. Calcium-based binders, such as calcium carbonate and PhosLo, can lead to hypercalcemia. Non-calcium-based binders, such as Fosrenol and sevelamer, may interfere with patients' other medications. Sevelamer binds to bile acids and interferes with fat absorption, so absorption of fat-soluble vitamins D, E, and K may be reduced. Furthermore, Renagel has the potential for decreased bicarbonate levels compared to Renvela. Sevelamer patients should have these levels monitored. Finally, Fresenius' new iron-based phosphate binder, Velphoro, has a major advantage due to a lower pill burden compared to Auryxia. However, Velphoro (sucroferric oxyhydroxide) does not have absorbable iron, and contains sucrose that metabolizes to glucose, which can be problematic in diabetic CKD patients. Auryxia does have the potential to raise aluminum absorption due to its citrate salt, a trait it shares with calcium citrate (and the reason that particular calcium salt is not recommended for CKD).

    Financial position: As of December 31, 2014, Keryx had cash and securities of $85.8 million. This was supplemented by $118.3 million in net proceeds from a January public common stock offering. With guided operating expenses for 2015 at about $30 million per quarter, Keryx should last until 2016 without the need for further financing.

  • Summary

    Auryxia's slow launch means Keryx won't meet Q1 estimates.
    However, the launch should hit high gear in Q2 and beyond.
    The European market also awaits with a likely positive nod from the EMA in summer.

    Keryx Biopharmaceuticals (NASDAQ:KERX) is a mid-sized biopharmaceutical company focused on pharmaceutical products geared towards renal disease. Keryx has a market cap of $1.30 billion and on Feb. 27, reported financial results for the fourth quarter and year ended December 31, 2014. The company has one product, ferric citrate, the first and only absorbable oral iron-based phosphate binder. Ferric citrate is approved in Japan and by the Food and Drug Administration (FDA), under different trade names, to control serum phosphorous levels in patients with chronic kidney disease (CKD).

    Keryx is seeking to expand to Europe using the brand Zerenex and filed a Marketing Authorization Application (MAA), which is under active review by the European Medicine Agency (EMA). Commercialization is in the early stages, as partner Japan Tobacco (OTCPK:JAPAF)/Torii Pharmaceutical Co., Ltd (OTC:TRXPF) launched Riona last May, while Keryx itself launched Auryxia in the U.S. in late December 2014. Auryxia is approved to treat hyperphosphatemia only in patients on dialysis. To obtain a label expansion for Auryxia as a treatment for iron deficiency anemia (IDA) in non-dialysis dependent CKD patients or pre-dialysis patients, Keryx initiated a Phase 3 trial. It is likely that Keryx will be successful in all these efforts later this year, but first, they will miss analysts' expectations for Q1 2015.

    Lead product:

    According to the National Kidney Foundation-Kidney Disease Quality Outcome Initiative (NKF-KDOQI) and the Kidney Disease: Improving Global Outcomes (KDIGO) guidelines update to KDOQI, to reduce excess phosphate and its associated increased risk of mortality, patients with kidney failure (Stage 5 CKD) may use either calcium-based phosphate binders such as PhosLo (calcium acetate) from Fresenius (NYSE:FMS); Genzyme's sevelamer products Renagel or Renvela; or Fosrenol from Shire (NASDAQ:SHPG). Auryxia was not available at the time these guidelines were developed. However, Phase 3 trials of Auryxia versus placebo as well as active control (Renvela and PhosLo) have demonstrated Auryxia's efficacious serum phosphorus lowering capabilities.

  • big_jake_ii big_jake_ii Apr 23, 2015 8:56 AM Flag

    golf ball, you are now off ignore but....

  • big_jake_ii big_jake_ii Apr 23, 2015 8:45 AM Flag

    Sentiment and anticipation.....
    There is no current immediate need to buy the stock in most investors minds ...That's why the stock price is languishing in the $11-13 range. This will all change when the catalyst dates approach as we have seen in the past. I am maintaining by long position just in case a big Pharma wants to scoop up the company at bargain prices while they still can.
    If not, the action will commence mid to late summer. With good results European approval, additional formularies and phase III CKD, we will see $25-30 by this time next year. Patience,my friend. is the watchword.

    Sentiment: Strong Buy

  • Keryx Biopharmaceuticals’ (NASDAQ:KERX) sales are expected to gain traction as payers come onboard, according to a research note released by H.C. Wainwright (HCW) on Monday.

    “While the first six weeks of Auryxia’s commercialization have yielded modest sales and prescription numbers, we believe several factors contributing to the lag are specific to the phosphate binder commercial landscape and will likely translate to backend-loaded sales,” analyst Reni Benjamin wrote.

    HCW said that the management of the New York-based company is making progress in adding Auryxia to the formularies of commercial and Medicare Part D payers in addition to educating nephrologists and dialysis center staff to identify patients who could potentially benefit from Auryxia.

    “If management achieves its stated goal of getting Auryxia on formularies at 80 percent of Part D payers later this year, we expect sales to gain momentum in 2H15,” Benjamin wrote.

    HCW said that although it is revising its 2015 revenue estimate to account for a slow launch, the equity research firm’s 2018 U.S. sales estimate has increased slightly to $369 million.

    HCW believes shares of Keryx remain undervalued as the company has $174 million in cash and equivalents (pro forma), a 60-person sales force to market Auryxia, and incoming royalties from Japanese partner JT Torii.

    The 60-person salesforce is conducting a two pronged attack, targeting 5,000 nephrologists (who write about 80 percent of prescriptions for phosphate binders for the estimated 110,000 new dialysis patients per year), as well as the dialysis center staff with educational campaigns.

    “If the landscape for phosphate binders was the same 14 today as it was in 1999 (e.g. no Medicare Part D), we might expect to see an even steeper launch trajectory for Auryxia, given its potential benefits over other phosphate binders,” Benjamin wrote.

    Pending Phase 3 trial data, expected in the fourth quarter, HCW said that Auryxia could gain entry into the pre-dia

    Sentiment: Strong Buy

  • big_jake_ii big_jake_ii Apr 22, 2015 11:10 AM Flag

    I hear you....that is a common sentiment.

  • big_jake_ii big_jake_ii Apr 22, 2015 10:59 AM Flag

    That was the author speaking. Read the book.

  • big_jake_ii big_jake_ii Apr 22, 2015 9:22 AM Flag

    hi Dutch,
    unless there is something that we couldn't have anticipated happens, all signs point to Auryxia being the Best option for chronic kidney disease and end stage renal disease patients as well as saving dialysis centers $1000 per patient per year .
    Yes Seth Klarman is the big dog on the block....and we are very fortunate that he is our big dog.

  • big_jake_ii big_jake_ii Apr 22, 2015 7:55 AM Flag

    But what did Gore turn around and do? He sold his Current TV network to Al Jazeera for $500 million. Gore reportedly pocketed $100 million, and in another widely reported story he is alleged to have pushed to get the transaction completed before higher tax rates kicked in on January 1 of this year.

    So what’s the problem? The problem is that Al Jazeera is funded by Qatar, which receives the bulk of its wealth from fossil fuels. Gore was grilled over this apparent hypocrisy, first by Matt Lauer:

    Lauer challenged him on the fact that he had criticized the influence of fossil fuel money in television, but then got very wealthy selling his network to another network that exists because of fossil fuel money. Al Jazeera had the money to pay Gore $500 million because of fossil fuels. Lauer asked Gore if he saw a contradiction in his position. While Gore said he understands the criticism, he disagrees with it because Al Jazeera is a great network and has won major awards.

    Now, someone can correct me if I am wrong, but I don’t ever recall Gore saying that it was OK to take fossil fuel money in television as long as the network is a good network or is one that has won awards. He is engaging in the logical fallacy of special pleading, which is where someone applies a special exemption to their rules when those rules contradict their actions. For example:

    Al Gore: “You should never run a red light.”

    Me: “But you just ran a red light.”

    Al Gore: “Yes, but I was in a hurry.”

    I can apply the same special pleading to any oil company and justify consuming their oil since they make charitable contributions and invest in renewables.

  • Oil Money is Bad Money, Except When…

    Al Gore has just released a new book — The Future: Six Drivers of Global Change — and is on a media tour to promote it. But he has had to face some very uncomfortable questions involving a charge that has been around for a while: That Al Gore is a hypocrite.

    The hypocrisy charge has been raised against Gore over the years. Until now, the most infamous incident of apparent hypocrisy took place in 2007 when it was widely reported that Al Gore’s mansion had a utility bill about 20 times more than the average family home. (See Al Gore’s ‘Inconvenient Truth’? — A $30,000 Utility Bill). I found the news troubling; after all Gore was the Conservationist-in-Chief but he certainly didn’t appear to be walking his talk.

    But I also wrote that if he was running a staff out of his home, then the higher electric bills were more understandable. I also learned at the time just how rabidly partisan people can be when discussing Gore. Some on the left would not tolerate criticism of Gore, and I was vilified for saying that I was disappointed in his behavior.

    But, I really wanted to like Al Gore. I thought of him as someone who was making a positive impact by calling attention to a serious problem, and getting people to conserve. I defended him when people noted that Gore traveled around the world in fossil-fueled jets. After all, I argued, if he traveled halfway around the world but convinced 500 people in a foreign country to become involved and take action, then the net impact could easily be lower carbon emissions as a result of his travels.

  • big_jake_ii big_jake_ii Apr 22, 2015 7:19 AM Flag

    so I take it ,you voted for Obama?

  • big_jake_ii big_jake_ii Apr 21, 2015 8:42 PM Flag

    Dave....just waiting on the catalysts...Europe -mid -summer and ckd Phase III this fall.
    Dead money until then? Maybe yes ,maybe no. Baupost is holding . Buyout possibility increases as time goes by. Patience.....

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