yep all great points!
the opportunity here is for ARWR to show EFFICACY of DPC with either ARC 520 or AAT. Then, they dust off the oncology targets from NVS and Roche and pick 2-3 ... then you have a monster.
first we have to sail between Scilla and Charibdis and get one of these programs to show human efficacy and either partner or raise additional funds.
Agree that ARC 520 plus NUC is a great path. disagree on ARC 520 + IFN, one of the big values with ARC 520 is the ability to avoid the nasty side effects of IFN. But yes, maybe once a week injection of 4mg can produce a 2-3log kd and allow clearance? In rat model they were at 3log, but not sure what type of human dose that would equate to.
THe frustrating part is the FDA delays on multi dose at 3-4mg. I am optimistic that Asia will allow that portion of trial to proceed sooner. near term that provides easiest pop in stock price. then showing a chimp with FC or at least most chimps with Immune response will confirm likelihood of multi-dose success. should equate to $15 then.
I'm not promoting ALNY, I'm merely explaining the difference in the companies assets and strategies. clearly owning all the IP is a huge value creator and that's why wall street Is more comfortable taking position in that strategy than pure R&D
its important for investors (especially recent ones) to understand that ARWR can't be ALNY. THe reason is that ALNY was clever in buying up the Tuschl I and Tuschl II patents back in 2002, and they bought Merck's patents as well.
ALNY is unique in that almost any drug developed using SiRNA will result in ALNY receiving royalties. ARWR's HBV candidate for example is licensed from ALNY and if successful will result in "single digit to mid double digit' royalty payments to ALNY (read the 10-k).
ARWR's intellectual property ownership is limited to
DPC technology from Mirus / Roche
Trigger technology from Roche, NVS research
The rest of their IP is all licensed from ALNY and others.
So ALNY is unique because basically they are a Patent Troll, they have a position sort of like Qualcomm had, in that if RNAI ever takes off, every drug will result in royalties to them, so they don't even have to be successful in drug development themselves.
ARWR on the other hand can only create value by developing drugs and / or licensing out DPC delivering and trigger mechanisms related to DPC. a far riskier position.
that said, that's why ARWR is a 300million market cap and has the upside potential to be $2bill - $5bill near term
It is incrementally positive for sure. I think Dirk H had stated some time ago that Gileads treatment was only a small incremental likely improvement on Interferon in that it might reduce the necessary time on Interferon, not replace it or cure the disease.
everyone should read this article on xconomy about the ceo of ALNY. very good history of the RNAI business development evolution. its called something like 'John Maragarone, from geek to ceo'
I should add that I think shares are a solid buy at $6 regardless what they announce at this analyst day. I think it will trade $7-8 prior to or just after no matter what the data is. Just not sure what happens after that.
Seminal + inviting analysts = changing the approach to the R&D path + results of some kind that provide material update or change to the company's outlook.
I'm scared of the change part, as it may create doubt about the path they're on. And they keep mentionign they are a 'leader in HBV research'... if they were close to FC I'd expect bolder statements than reminding us they are in research.
they had an 'analyst day' last year announcing ARC AAT. They invited 3 "KOL's" to discuss briefly what AAT is all about.
A panel of key opinion leaders will join Arrowhead management for the presentation today. Included in the panel are: Jeffrey Teckman, M.D., professor of pediatrics and biochemistry and molecular biology, and director, division of gastroenterology and hepatology, department of pediatrics, St. Louis University School of Medicine; John Walsh, co-founder, president and CEO, Alpha-1 Foundation; and, Jean-Marc Quach, executive director, The Alpha-1 Project.
"ARC-AAT is our second clinical candidate to use the DPC delivery system, and we are excited to build on the success to date of ARC-520, our clinical candidate against chronic hepatitis B infection, which is currently in a Phase 2a study," said Christopher Anzalone, Ph.D., Arrowhead's president and chief executive officer.
we need asia to approve 2-4mg multi-dose. that will get the stock back to $10 imo or higher. as it defines the timeline to seeing efficacy results from up to 4mg multi-dose with ancillary drugs. If they approve in June then we'd see data by January 2016.
The FDA is requiring full completion of 1mg multi dose before even considering letting ARWR move with 2-4 mg
I believe the SNALP licensing that ARWR got in that deal was TKMR's 1st generation and they have since gone to 2nd and 3rd generation versions which are more effective. So ARWR didn't do anything with it.
Its very unclear which of the delivery platforms really performs best at this point.
TKMR 3rd gen SNALP
ARWR (Mirus) DPC
we'll duke it out in the labs I suppose....
The amazing thing is how incestuous the whole thing is at this point... everyone is licensing from each other and badmouthing eachother publicly, then turning around and doing more deals with each other.
ARWR is licensing DPC to ALNY. ALNY is licensing HBV targets to ARWR and TKMR. TKMR licensing and occasionally suing to ALNY.
its crazy. Let's hope if one wins we all win.
question: what IP do they have other than DPC? ARC520 and the NVS candidates are all licensed from ALNY aren't they?
what ARWR has is a delivery mechanism that is their only differentiator that I'm aware of. Beyond that they have a 1-1.5 year lead in development of an RNAI specific treatment for HBV. However there are what 20-30 other treatments in various phases of development / pre-development by other companies?
so I'm not so sure I understand the level of certainty that folks here have.
Chimp data will be great I'm sure, but ALNY themselves also have chimp data showing immune system responses. And it doesn't shorten the development cycle to show more chimp data.
I guess I'm at a loss for what real positives are going to come from this.
I am very nervous about it frankly. I expect them to show FC type immune responess in the chimps with varying combo drugs and then change their KD goal to something lower than 90% based on that data.
but ultimately the stock price will be affected not by any chimp data, but by the human trials showing actual EFFICACY, which as yet there is none to show. So the longer it takes to get to that efficacy data, the more the stock price will sit around levels that reflect skepticism and cash burn.
guess I don't understand all the happy go lucky folks here who think $50 is a sure thing
one likely reason for extension into e positive patients for p2A is that they always intended to do P2b using both e-antigen negative and e-antigen positive populations. my guess is that its a requirement from the FDA (and perhaps other bodies) to see safety data from the e-antigen positive group if they want to get approved for multi-dose in P2b. that ties with the actions of waiting to release the data and mentioning ' complete' data.
and not some indication of higher efficacy in the chimp results. I suspect they had to go back 'check all the boxes' for FDA.
Its very hard to assign any value on it as its so vague in terms of the benefits to DPC.
but I find it most interesting that Novartis sold it to ARWR and not ALNY. Novartis was a HUGE partner for ALNY ... they had a 13% stake in ALNY , and they not only ended the partnership, they sold their investment, and then sold the program assets and ALNY's IP access to Arrowhead. that really says alot about what they think of Alnylam.
now what does it mean fro ARWR ? Probably nothing for several years. I suppose the bet is that the molecules can be used with DPC and be more efficient. But that will take studies to discover and validate.
What would be interesting and validating is if ALNY licensed more DPC rights for other drug development efforts ( think ALNY licenses and uses DPC for one now). That would validate that 'there's something there'
i guess you mean ALNY? The reason that co is so richly valued is they wisely went around and bought up literally 90% of the IP back in 2002. so no matter who succeeds, TKMR, ARWR, RGLS, ISIS, ALNY they will get royalties . plus they have the backing of Genzyme and theGenzyme deal put a tangible valuation marker on that IP. Yes their ceo is a loudmouth. I wonder if the reason NVS bailed on ALNY partnership had to do with that.
you should not screw around with options. you are not experienced enough. 85% or more options expire worthless. do you really believe you are the smartest 15% of the entire investor market? make money investing for a bunch of years and build up a cache. sell calls to start. read Natenberg's book. if you can understand that book and master it, then start trading options. you're not ready
yes indeed. but again mgmt. set that goal! the best outcome for shareholders is it requires a year of therapy or even ongoing therapy. however that will also be very very hard to get the FDA to allow the trials for such an extended duration with an experimental substance hitting directly to the liver. cancer risk
The primary source of confusion is mgmt. continually referring alternately to results from single dose vs. multi-dose and 'hinting' at the result. that has confused everyone including investors. THey need to stop doing that.
WHat I believe is they are close or reached FC in chimps with a combo drug therapy and a different RNAI profile version of ARC 520 in a multi dose 9 month chimp study.
I believe the single dose human results have not hit 1 log in 3mg or 4mg so they are going to disappoint when released. Mgmt hopes that the chimp data will prodive the basis for expanded human studies mixing in the interferon or other ancillaries.
However the risk here is that at least in the USA, the FDA is going to require a full completed 1mg multi dose study completed before approving a higher multi-dose study to proceed, that means 2016. In addition ARWR needs to raise additional cash by Q1 next year, so whatever they plan for this analyst day had better boost the stock substantially so they can then raise a $200mill or greater amount to proceed with more trials and more time to accommodate FDA.
here's the good part for investors. if we assume that the 9 months chimp study showed a FC or close, it means that should the drug be approved it will require use for 9 months or longer, and that means a higher revenue profile if its every put into use.
yes that person is not making a smart move.
1. the time decay kills the value since we know nothing will happen in next 60 days, there is no reason to jump in now.
2. The expiration date gives no real chance of the event taking place prior to expiration.
better approach would be selling puts, or as you indicate buy the Jan 16's but wait another 45-60 days.
I think selling puts here with a sept exp. makes more sense. if you get the stock put to you, who cares you are more long.
are you new to this?
everything they've published has taken longer than expected. the FDA could say 'we'd also like to see xyz now'.. or participants may drop out. its a short timeline.
earlier this year we expected multi-dose trials from 1mg to 4mg starting in Q2, now its more like Q4, or 2016...
not baffling at all. Wall street has a 1 yr outlook and they invest in things with a one year 'catalyst'. mgmt. got everyone excited 18 months ago that they were on a fast track to a HBV drug. then Sovaldi blew everyone's mind on the potential of Hep treatments being at $80k per treatment. So wall street got excited.
but now WS realizes with each passing quarter that the approval process is being delayed by FDA, and requires a lot more research, which means more fund raising, more cashburn, and more years. Meanwhile competitors benefit from ARWR doing all the safety studies on RNAI and get to 'catch up'.
the original assumptions were unrealistic, but remember those assumptions came from Anazalone who promotes the story at every little bio day at every investment bank out there. so he set the expectation.
The science may still work out, but its going to take another $250mill fund raising within a year. that's going to be tough to absorb if they don't have human efficacy data or partnership by then.
Chimp efficacy doesn't get it done. we know that.
not a mystery here. lots of interesting things going on, but human efficacy data does not exist at this time. still pure research vehicle burning through cash at $28 mill per quarter with 4 quarters left before secondary needed.