I'm pretty sure the plan on PC is to get a spectacular result, make sure every oncologist on Earth hears about it, and make a ton from off-label use while a p3 is going. That requires the result to be spectacular, not merely good, which is one hell of a gigantic 'if.' Realistically, we can hope for a result justifying a p3 either there or for '110. We might not get much of anything: the cMet inhibitor royalty can be taken as paying off the promise of news.
I don't expect anyone to react much to the actual revenue unless it's under $64 MM or OVER $75 MM. It'll be a big deal if they can say that the PML case doesn't appear linked to ruxo (they'd need to be real sure that FDA wouldn't slam then for saying it). Incyte is mostly a quality-of-pipeline story, and a clean infection record makes a pipeline of JAK 1/2 inhibitors higher quality. As always, more light on the dark pipeline would perk up the shares. MOST companies comparable to Incyte talk about pipeline entries pretty much as soon as there's proof-of-concept.
What about the rest? My grudging support of the incumbents was a small part of the reaction. Do you disagree that they've suddenly turned to offering analysts everything they can possibly give (and more)? Do you think they were being deceptive about the licensing business being closer to restored than to collapsed? Are you less than astounded that a modern BoD would acknowledge that their business inevitably had periodic fluctuations at least as large as its regular progression?
I admit that given a choice between a PE consortium and a legion of demons, I'd give it a long think. So I'm prejudiced against Starboard given any alternative at all. But we seem to be getting a bigger change from The Three Wise Monkeys than I would EVER have expected.
FINALLY the replay is available on Tessera's web site. The transcript doesn't do it justice. Like having had a pet Rottweiler and then switching to a cocker spaniel. The business is still somewhat in disarray. There are still a lot of things that they can't disclose for competitive or contractual reasons, but they promise to say what they can, and to give estimates when they can even if the range is extreme. Recognition at all levels that a substantial part of the business consists of stair-step events. They THANKED Krish Sankar for continuing coverage (I somewhat devalue his subsequent upgrade: what I imagine is that several bigwigs sat down with him for an afternoon on "how do we repair broken relations with the investment community?" And ACTED, or at least promised to act, on what developed).
Of f'n COURSE the change is in reaction to Starboard and the groundswell of support for them. But their diagnosis of the problems didn't exactly take a business prodigy. I'm inclined to thank them for their service and vote for the existing board.
I hope they have an intermission to accommodate Metallica fans with prostate trouble.
Well, we know that there was a "golden cross" pretty much the same day as the 8K on PML. Sounds to me like The Street is as in the dark as anyone.
This is, by the way, the third CC since the awful one. Rule of thumb is that it takes 3 good ones in a row to atone for a bad one (that's really more about results than about presentation, but for an early-stage company they're pretty much equivalent), so attention is focused.
There really isn't any "possible take-out premium." As always, management and institutional holders see a drug with $multiple hundred MM a quarter revenue potential, and possible acquirers see a drug with $10 MM a quarter actual revenue. They won't reach a deal, and really the stock price is appropriate for a company this size with a nice-looking US p3 in progress (with the usual no credit for European market).
Possible catalysts I could see for a strong up move would be SUBSTANTIAL current revenue from Europe (probably doesn't really need $60 MM, but $45 MM or better), which looks unlikely before late '14, or successful completion of ASCEND--call it mid '14. I can't for the life of me imagine a plausible downward catalyst (termination of ASCEND for futility would do it, but it isn't plausible)(and note that patient compliance was addressed in the recent CC, positively).
Nobody has talked lately about the poking at applicability of pirfenidone to kidney disease. About the only way I could see that making a difference would be if preliminary results attract a nice partnership arrangement--a very long shot.
Until then, the stock figures to be range-bound.
I see this as more negative than positive. To some extent, Pfizer just messed up, presuming that generally subjective endpoints could carry most of the burden of establishing efficacy. In the world before TNF inhibitors, they would probably have been correct. Regulators are demanding that a new drug class be better than existing drugs, not just alternative to and about as good. One hopes Lilly/Incyte are taking this lesson to heart--FDA figures to demand better evidence of disease modification for bari than they settled for on tofa. The upside for Incyte is that CHMP seem concerned about off-target toxicity of tofa and suspicious about possible immunosuppression. We know that these aren't problems with bari, so that will be a promotable advantage after approval.
I haven't sweated through overcoming an initial CHMP rejection, so I don't know the processes or time course. I doubt that it's as bad a an FDA rejection.
Ok, if you want to be discouraged, you could focus on Spain. It's an important market, and there had previously been some hope that the government was pulling itself together.
I have to admit that I'd expected more revenue, with France and some of the medium-sized companies starting fast (not having the IQWiG confusion). And the full-year estimate was perhaps too wide on the low range to communicate confidence. It's a real question how long it will take to produce a $60MM revenue quarter, and I just don't see much promise of it happening in 2014.
Running the thing to maximum brings up the question: when did Incyte communicate that it did not expect to make a big business from its gene patents?
I agree. I missed hearing another installment of the comparison with Tracleer, but the situation is getting more complicated. I'm going to have to listen to the accounting treatment of the convertibles again; there may be something worth remembering in there.
As this company gets increased attention, Mr Welch's speaking style is becoming more meaningful. The CEO's presentation style can have a completely unreasonable effect on stock price. He sounds good for most of each answer. Basically, the problem is that his restatement of each question has a tone as if you had just killed his dog, and the tone continues a sentence or two into the answer.
The summary of R&D expenditures didn't include anything for Son of Pirfenidone; I hope they're at least poking at the problem.
Some guy on Forbes estimated quarterly revenue $10-11 MM. Finally, an (I hope) underestimate rather than that destructive $60MM overestimate.
I won't disagree with the widening loss from operations because the selling effort is expanding rapidly.
We don't know the terms for either. My guess on the milestone is July (based on approval in countries representing 50+% of European population). Delays because Italy doesn't have a government and Spain isn't much better off..
Sho' 'nuff. That's what the company web site says. I wouldn't expect much of interest to us from such a huge company, although little numbers may get expanded to whole paragraphs when Incyte management speaks.
No real thoughts. This isn't a current revenue story. Anything over $65MM would be ok, although it really takes a couple more $MM to make people happy (I'd like $80MM, which is just barely possible) We won't see any effect of the PML case this quarter; on the other hand, we won't see any effect of the evidence that early commencement of Jakafi has long-lasting benefits. Management MUST deliver something against the promise of big news coming--they'd be better off to annoy FDA by releasing raw data on '110 than to infuriate analysts by saying "trust us." Or they could say (if it's true) that the median survival of all patients combined in the pancreatic CA study was x% longer than the predicted median, so they were very hopeful etc. They have to say something. Still a discovery and development shop--Pinocchio needs 3 marketed products to be a REAL boy...errr...drug company.
But for the BRCA genes, a lot of the value is tied up in WHICH mutation is present, and what degree of risk it presents. Myriad has the best database, and they can't be expropriated of it.
Another point: we have seen that BRACAnalysis sales are highly dependent on sales calls to physicians. Myriad's reps are going to be pretty colorful about the importance of using the validated test. For that matter, it's pretty doubtful that a competitor's testing will be reimbursable for at least 18 months after introduction.
Just as fast? In Europe, where the patent situation hasn't excluded competition others take several months longer than Myriad. Much cheaper? Well, that depends on what accuracy you need--I seriously doubt that you can match Myriad's false positive rate any cheaper. False positives lead to needless surgery.