endo - no doubt this stock became part of the biotech momentum stock universe, but with good reason - they were generating 40%+ revenue growth from their existing products and had two new products in Luna and Pinpoint that could potentially drive revenue growth into the 50%+ range. At $24, the stock was priced for perfection and I didn't think it would hold that level unless results were stellar, but with sales from LifeCell and ISRG floundering, we've been cut in half. With the fiscal year-end of the mutual funds looming in Oct, you could see further selling pressure, as funds with losing positions do some "window dressing", especially since Arun has already said Q3 results were going to be weak. This is just another reason I am praying for a sale of the company - although the primary reason still is that NVDQ is sitting on the some of the most compelling technology in the medical system space and they don't seem to have the leadership or resources to take full advantage of it.
avii - You fail to see the trees. There is no "world market" for an Ebola drug. SRPT is out of equation for providing a terrorist stockpile - their contract with the DoD is over and this latest outbreak is not going to change that. Any potential use of SRPT's drug is a dicey prospect, since they won't be able to control who gets it, how it is administered and what stage of disease the patient is in, so the patients could likely die. If some die and some live, there would be no way of knowing if the drug works - how would that "validate" the platform.
usagary - which "government" are you talking about - what makes you think the US govt has control over the use of any Ebola drug in Africa? Time to move on - the Ebola "trade" is over - everyone is beginning to recognize the reality that there is no market for the treatments - nobody with any money or capacity to handle the experimental drugs.
endo - I have been in this stock a long time and I have listened to every presentation and conference call - most of them more than once - and the sense you get after all those years is that Arun is very meticulous with his strategy and development with the technology, but has held back on pushing aggressively into certain areas because (and I'm quoting him) the company does not have the "bandwith" to focus on more than one area at a time. I accepted that when they only had the original Spy system for open surgery and very little money in the bank, but now they are flush with cash and the pace seems to be about the same.
It is unacceptable at this stage in the growth cycle that they would have a sequentially flat or down quarter with the Spy system sales through LifeCell. He seems to have already played his hand with LifeCell and told them they are out, but seems willing to watch LifeCell let Spy sales deteriorate over the next year - an aggressive CEO would buy or sue them out of the contract to keep the momentum going.
I know I harp on the international issue, but think about it - they signed the LifeCell agreement 4 years ago (Sep 2010). The Spy technology is relatively simple to understand and use - it doesn't take a lot of technical training like daVinci - and the cost/benefit equation is clear cut and an easy sell. There is no reason they could not have signed up multiple foreign partners over the past several years.
I noticed your Cylinder 3 regarding clinical studies in lymph nodes. In scanning the old press releases to confirm the LifeCell start date, the YE2009 press release in Mar 2010 had as one of the hi-lites that they "initiated human clinical studies with the use of Spy scope for the visualization of lymph nodes" and four years later they are touting the same thing? This is just one example of the shiny new "opportunities" that Arun has identified for investors, only to let it sit on the back burner for years or let it die on the vine.
Appreciate the comments, but to conclude the company is running on "all eight cylinders" is a stretch. A couple issues still remain sketchy - if you are expecting Japanese approval by the end of the year (4 months away), how could you not have a marketing venture in place already to take advantage of that pending approval? Having 8 systems in Europe is an embarrassment - if they are trying to establish an international presence by themselves by providing a few machines here and there, is that really a "comprehensive strategy"? Sell the company - by the time Arun gets around to establishing a presence in these markets, the patents will expire.
hwsimp - how can you claim my ignorance when you counter with "the money has to come from somewhere"? It certainly hasn't so far, has it? There are numerous diseases in Africa that aren't as easily contained as Ebola that kill multiples more than Ebola and there is no money for those diseases, what makes you think any meaningful money will be spent here, and by who? I'll say it again - any money that is committed will be for containment - that is how this disease will be stopped - not with experimental treatments. The WHO has no control over any money that is going to make a difference here - just because they issue a press release doesn't mean a bunch of western govts are going to open the coffers. Even in the unlikely event that some money is committed to providing experimental drugs to the victims, it isn't going to be enough money to change SRPT's fortunes and will evaporate once the current outbreak is controlled. Tell me where I am wrong!?
The FDA did nothing - WHO made a policy statement. I have a proposal - until more than a handful of doses from any company are actually shipped to Africa, can we give this Ebola hype a rest? There is no market here - no money to be made - and the fear factor brings out the stupid in people I thought had more sense.
I assume the selloff this morning is due to the fact that their "guidance" on the Omidria launch has changed from late summer to the 4th quarter. Let's hope they don't blow the launch or we could be back down to 10 by the end of the year, although the Phase II data for either OMS721 or OMS824 could save us. What would really be nice is some kind of venture announced - either for Omidria in Europe or one of their other pipeline products - they have been running solo too long - they need some 3rd party validation of something in their pipeline?
copp - you're kidding, right - the "govt sponsored" drug plants have the ability to produce vaccines and I think one of them had the ability to process simple mAbs. You've heard CG speak about how complex the manufacturing process is for their drugs and you think they can just turn it over to some prefabricated govt lab?
That's the point - these African countries don't have the medical sophistication to quarantine patients properly in order to contain the virus, let alone "triage" patients to make the best use of available treatments. From what I understand, all these drugs are tested within a few days of the animals being infected - I would guess the vast majority of Ebola victims in Africa don't get access to a doctor until they exhibit symptoms for more than a week, which is how long after infection? Do they even have the lab facilities to test and confirm an Ebola infection within a few days? There are so many reasons that the "available treatments" will not be used or used effectively - that is just another reason why the investment hype surrounding companies w Ebola treatments in the clinic is misguided.
Unless Ebola spreads to the US or some other western country in a significant way, you won't see any of the drugs under development being used. Africa's health care system is so primitive, they don't have the resources to handle,let alone pay for, these sophisticated drugs. Do you think TKMR is going to adopt one of these countries as a charity case and start manufacturing drugs that the country can't afford. There is no money to be made here and if you think the US or some other benefactor is going to cover the cost, think again - any support that is funneled to these African countries is going to go toward containment, not treatment. Out of all the hyped up MB posts on this and TKMR's board, I have yet to see one rational post about how any Ebola drug is a money maker - give me the number patients/doses to be treated and the revenue per patient/dose and who is going to pay for it. Anyone?
All the sales are part of the exec's 10b5-1 plans - this is where they schedule to sell a certain amount of shares (or dollar value) on specified dates regardless of where the share price is. It precludes them from having to worry about being in a quiet period or earnings lock-out.
Translation, the African govts don't have the money to properly monitor and quarantine patients, let alone pay for expensive anti-viral drugs. Conclusion - no African nation will ever buy TKMR's drug and the front-line support that might be provided by the US won't be for treatment, it will be for containment.
TKMR's market cap has increased by over $250M since the Ebola outbreak scare became fervent, which is over $100,000 for every patient that has been infected. Odds are that none of the African patients will ever be given TKMR's drug and unless the number of patients in the US suddenly escalates, it won't likely be used in the US, either. I wish I could short it at these levels, but Fidelity has no shares available. You'd be better off investing in the company that makes the protective suits for medical workers.
Not politically incorrect - has nothing to do with politics - it is a money/resources issue. If these African countries had the money to spend on expensive anti-viral drugs, they wouldn't have an Ebola problem, because they would have first spent the money on a medical inftrastructure that would stop potential epidemics in their tracks. That is why this disease is no real threat to the US - we have the systems in place to detect it, quarantine people and keep it from spreading. Spending precious resources on expensive drugs to treat the infected is a losing proposition if you can't control the spread of infection - better to spend your limited resources on prevention.
You keep completely missing the point. The fact that TKMR has an active govt contract means nothing - that contract is to test their drug through a series of clinical trials to determine safety and efficacy. They are not suddenly going to say, take the $30M we have committed for this year's research and spend it on giving drug to African patients - not going to happen. The hype around the FDA's move to partially lift the hold on TKMR boggles my mind - the FDA is basically saying "if somebody wants your drug, we won't stop you" - NOT that the US govt is going to pay them to distribute their drug. As I challenged copp earlier - who is the "somebody" that is going to start buying drug from any of these companies to be distributed in Africa? I agree w copp in that the safety issues TKMR's drug has (on healthy people) would make if very sketchy to give it to a very sick patient. Does that open the door for SRPT or another company - only if you believe "somebody" with big pockets will come knocking - not going to happen in a manner that changes the company's financial prospects.
Way to join the hype parade - your logic is more than dismal, it is pathetic. No doubt, the odds of an infected person making their way to the US is high - is that going to result in a city being shut down? Beyond that, any money that will be allocated to Ebola will be to prevent it from being spread - treatment for the unlucky patients will be a low priority outside the US, just like most of Africa's deadly diseases.
Again, SRPT spent years developing it because the DoD paid them to study it for potential use against a bioterrorism threat against the US or its soldiers overseas. That doesn't change the equation of who will pay for it to be used for the general population in a 3rd world country. "Covering expenses" in an emergency situation is not a business model that will bring long-term value to the company. I don't care if you want to hype the short-term spike that having an Ebola drug on hand may provide, but don't try to argue that it will be a big part of this company's long term prospects/value.
copp - You're the one who is nuts - who is the "someone" that is going to request SRPT's drug and even in the remote possibility that "someone" comes along, how many doses are they going to buy and at what price? Assuming it is an "emergency" situation, what do you think the pricing is going to be? Firms will not get away gouging govt agencies in an emergency situation, like they routinely do in "negotiated" govt contracts. Give us your timeline and revenue projection for this "request" or what your analysis is for the long-term revenue potential for an Ebola treatment.
WHO has money DoD has money? The DoD is responsible for identifying potential threats to US citizens or soldiers around the world and taking steps to protect them - that is what these contracts to SRPT, TKMR, etc. were about - not combating 3rd world diseases - they will not buy drug to be given to patients. WHO has money, but they also know that Ebola is way down on the list of health threats - they aren't going to spend millions of dollars for a drug that may help thousands of patients - they have to spend their money wisely - they will spend millions when it will help millions. Malaria kills more people in a day than Ebola has killed in this latest outbreak - do you think WHO is going to trash their malaria budget and put millions at risk to fight Ebola? I'm not advocating the reality - I'm just stating it - there is no govt agency that is going to write a check for this. Your best hope is for the Gates Foundation or someone like that throwing money at it, but even a group like that would probably focus on preventing the spread than treating the sick with expensive, experimental drugs.