Stem Cells Versus Aging, Fountain of Youth (BTIM, GERN, ACTC)
How many movies and legends are based upon eternal youth? Hundreds or thousands for sure. BioTime, Inc. (NYSE Amex: BTIM) is seeing a massive surge of interest today after the company announced a “Peer-Reviewed Scientific Publication on the Reversal of the Developmental Aging of Normal Human Cells.”
The company is a small-cap biotechnology company (approximately $250 million) pursuing the development and marketing of products in the field of stem cells and regenerative medicine. The article was released online today in the peer-reviewed journal Regenerative Medicine ahead of the print publication showing that the aging of human cells can be reversed. The company noted that this “may have significant implications for the development of new classes of cell-based therapies targeting age-related degenerative disease.”
BioTime and its collaborators demonstrate the successful reversal of the developmental aging of normal human cells according to the article. The full article at Future Medicine is here.
BioTime is is led by Dr. Michael West as CEO. He was the Founder of Geron Corporation (NASDAQ: GERN), where he served until 1998. From 1998 to 2007 he was President and Chief Scientific Officer of Advanced Cell Technology Inc. (OTC: ACTC). Dr. West also gave a CNBC video here just this morning.
Also noted was that the aged differentiated cells became young stem cells capable of regeneration and transforming adult human cells back to a state very similar to embryonic stem cells. Does it come without exception or without differences? No.
Still, this is sending BioTime shares through the roof. Usually we see just over 100,000 shares trade hands. Today we have 3.3 million shares traded at 12:50 PM EST and BioTime’s stock is up 28% at $7.43 today.
JON C. OGG
Diabetes & Insulin War About To Heat Up (MNKD, LLY, NVO, PFE, BMY, AZN, GERN)
MannKind Corp. (NASDAQ: MNKD) has not gone without its critics over the company’s inhaled insulin. The company has an upcoming review that will be a make or break event for the company. The company is about to face a potential do or die test next week as the FDA is set to decide the fate of the company’s inhaled insulin. MannKind’s Afresa is designed to deliver a fast acting insulin that is supposed to be more effective than the injected products. This would put the company in competition for insulin with Eli Lilly & Co (NYSE: LLY) and Novo Nordisk (NYSE: NVO) for their insulin delivery.
One of the biggest hurdles MannKind faces is that inhaled insulin products have been tried and tested by others, and they have failed or have fallen far short of the expectations set ahead of time. Pfizer Inc. (NYSE: PFE) discontinued its Exubera as an inhalable insulin.
- Lexicon Pharmacueticals (NASDAQ: LXRX) had a favorable Phase I reaction late last year in type 2 diabetes mellitus.
- These companies are all also fighting for their part of that next $170 billion market opportunity.
- Bristol-Myers Squibb (NYSE: BMY) and AstraZeneca (NYSE: AZN) already received FDA approval for Onglyza as an adjunct to diet and exercise to improve glycemic control in adults with type 2 diabetes.
- Geron Corporation (NASDAQ: GERN) is still a ways off for the stem cell angle here compared to its other stem cell endeavors, although you never know when stem cell companies will make periodic announcements.
The FDA is set to make a ruling on Afresa’s approval by January 16, which means that the JAN-2010 CALL options may or may not expire before such ruling is made. The FDA can always delay, and some reports hint at a later date now.
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Key Biotech Short Selling Changes in November (AMGN, BIIB, CELG, GILD, GENZ, GERN, LIFE, DNDN, HGSI, AMLN, OSIP)
We have now seen the changes in short selling in biotech stocks via the late-November short interest report from NASDAQ. This marks the changes seen at the November 30, 2009 settlement date versus a November 13 settlement date. We have given short interest data on Amgen Inc. (NASDAQ: AMGN), Biogen Idec Inc. (NASDAQ: BIIB), Gilead Sciences Inc. (NASDAQ: GILD), Celgene Corporation (NASDAQ: CELG), Genzyme Corp. (NASDAQ: GENZ), Geron Corporation (NASDAQ: GERN), Life Technologies Corporation (NASDAQ: LIFE), Dendreon Corp. (NASDAQ: DNDN), Human Genome Sciences Inc. (NASDAQ: HGSI), Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN), and OSI Pharmaceuticals Inc. (NASDAQ: OSIP).
Again, the change reflects the November 30 date versus a prior date of November 13:
Amgen Inc. (AMGN) 18,247,560 shares versus 15,888,876, a gain of 14.8%.
Biogen Idec Inc. (NASDAQ: BIIB) 8,914,221 shares versus 8,201,010, a gain of 8.7%.
Gilead Sciences Inc. (NASDAQ: GILD) 19,334,491 shares versus 20,330,539, a drop of -4.9%.
Celgene Corporation (NASDAQ: CELG) 7,800,195 shares versus 8,122,937, a drop of -4.0%.
Genzyme Corp. (NASDAQ: GENZ) 3,835,576 shares versus 4,531,522, a drop of -15.4%
Geron Corporation (NASDAQ: GERN) 13,846,894 shares versus 13,653,745, a gain of 1.4%.
Life Technologies Corporation (NASDAQ: LIFE) 8,686,786 shares versus 8,950,719, a drop of -3.0%.
Dendreon Corp. (NASDAQ: DNDN) 9,881,341 shares versus 9,105,303, a gain of 8.5%.
Human Genome Sciences Inc. (NASDAQ: HGSI) 17,100,782 shares versus 17,571,094, a drop of -2.7%.
Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) 8,353,185 shares versus 8,538,392, a drop of -2.2%.
OSI Pharmaceuticals Inc. (NASDAQ: OSIP) 5,471,010 versus 5,517,134, a drop of -0.8%.
JON C. OGG
December 10, 2009
NIH Brings Back Stem Cell Interest (STEM, GERN, ASTM, NBS, KOOL, OSIR, CYTX)
The National Institutes of Health has just today announced the approval of the first 13 human embryonic stem cell lines for use in NIH-funded research under the NIH Guidelines for Human Stem Cell Research adopted in July 2009. Children’s Hospital Boston developed 11 of the approved lines and Rockefeller University in New York City developed two of the approved lines. While those are private and non-public, this has some excitement around the other embryonic stem cell line companies because the NIH said that an additional 96 lines have been submitted to NIH for either internal administrative review or consideration, including more than 20 that will be considered on December 4, 2009. We are seeing strength as follows:
- StemCells Inc. (NASDAQ: STEM) up 5.5% at $1.14; 52-week range $0.89 to $3.07; market cap $135 million
- Geron Corporation (NASDAQ: GERN) up 4.8% at $5.70; 52-week range $3.00 to $9.24; market cap $522 million
- Aastrom Biosciences, Inc. (NASDAQ: ASTM) up 5.5% at $0.288; 52-week range $0.24 to $0.78; market cap $50 million
Neostem, Inc. (AMEX: NBS) is actually in adult stem cells, and shares are down 2.3% at $1.68; 52-week trading range is $0.41 to $2.72; market cap $61.3 million. ThermoGenesis Corp. (NASDAQ: KOOL) is also tied to adult stem cell lines but in products targeting stem cell companies; shares are up 3.4% at $0.61, its market cap is $34 million, and the 52-week range is $0.31 to $0.89.
Elsewhere in companies tied to stem cells… Osiris Therapeutics, Inc. (NASDAQ: OSIR) is up 0.4% at $6.89; 52-week range $5.35 to $21.65; market cap $225 million. Cytori Therapeutics, Inc. (NASDAQ: CYTX) is down 2.2% at $5.75, its market cap is $222 million, and the 52-week range is $1.42 to $6.04.
For a full data and explanation from the NIH website on what was approved, that can be found here.
JON C. OGG
DECEMBER 2, 2009
Geron Suppliers Register Shares for Sale (GERN)
Geron Corp. (NASDAQ: GERN) on Monday filed a registration statement for the resale of shares by existing holders. This is not a huge deal on the surface as it is ‘only’ 344,120 shares of common stock with a listed value of roughly $2 million. The following share counts are being filed to possibly be sold as follows:
- 55,545 shares by Hongene Biotechnology Limited,
- 93,244 shares by Samchully Pharm. Co., Ltd.
- 195,331 shares of our common stock by ReSearch Pharmaceutical Services, Inc.
Geron has already noted that it will not receive any of the proceeds from the sale of these shares. As you will also see, this represents an insignificant number of shares in the grand scheme of things.
As of November 11, 2009, Geron had 200,000,000 shares of common stock authorized for issuance and 91,971,441 shares of common stock outstanding. also as of November 11, 2009, Geron has reserved for future issuance approximately 25,831,114 shares of common stock for the company stock plans, potential milestone payments and outstanding warrants.
On November 10, 2009, in payment to Hongene Biotechnology Limited under a manufacturing agreement where Hongene is making certain raw materials intended to be used for the manufacture of drug product for use in human clinical trials, Geron issued to Hongene 55,545 shares of common stock.
On November 10, 2009, in payment to Samchully Pharm. Co., Ltd. under a manufacturing agreement where Samchully is performing certain services and manufacturing certain raw materials and products for use in human clinical trials, Geron issued to Samchully 93,244 shares of common stock.
On November 10, 2009, in payment to ReSearch Pharmaceutical Services, Inc. under a project agreement where RPS is providing certain services in support of Geron’s clinical programs, the company issued 195,331 shares to RPS.
Some insider sales by existing holders have ominous implications, but that does not appear to be the case here on the surface.
Jon C. Ogg
Key Biotech Short Interest Changes (AMGN, GILD, BIIB, CELG, GENZ, GERN, LIFE, DNDN, HGSI, AMLN, OSIP)
We have now been able to see the short interest changes that took place over the month of October-2009 in the world of biotech stocks. There were some key gains seen in a couple names, but the overall trend in biotech short selling seems to be down. We have given short interest data on Amgen Inc. (NASDAQ: AMGN), Gilead Sciences Inc. (NASDAQ: GILD), Biogen Idec Inc. (NASDAQ: BIIB), Celgene Corporation (NASDAQ: CELG), and Genzyme Corp. (NASDAQ: GENZ), Geron Corporation (NASDAQ: GERN), Life Technologies Corporation (NASDAQ: LIFE), Dendreon Corp. (NASDAQ: DNDN), Human Genome Sciences Inc. (NASDAQ: HGSI), Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN), and OSI Pharmaceuticals Inc. (NASDAQ: OSIP).
Key data is below with the short interest and the percentage change from mid-October to the end of october:
Amgen Inc. (AMGN)
AS OF DATE Short Int. Change
10/30/2009. 14,737,921 -9.5%
10/15/2009. 16,286,597
Gilead Sciences Inc. (NASDAQ: GILD)
AS OF DATE Short Int. Change
10/30/2009. 16,198,837 +10.2%
10/15/2009. 14,703,407
Celgene Corporation (NASDAQ: CELG)
AS OF DATE Short Int. Change
10/30/2009. 7,370,581 -4.6%
10/15/2009. 7,725,108
Biogen Idec Inc. (NASDAQ: BIIB)
AS OF DATE Short Int. Change
10/30/2009. 8,574,239 -2.9%
10/15/2009. 8,827,991
Genzyme Corp. (NASDAQ: GENZ)
AS OF DATE Short Int. Change
10/30/2009. 5,118,715 -36%
10/15/2009. 8,085,099
Geron Corporation (NASDAQ: GERN)
AS OF DATE Short Int. Change
10/30/2009. 12,907,169 -1.9%
10/15/2009. 15,152,295
Life Technologies Corporation (NASDAQ: LIFE)
AS OF DATE Short Int. Change
10/30/2009. 7,746,689 +8.0%
10/15/2009. 7,173,192
Dendreon Corp. (NASDAQ: DNDN)
AS OF DATE Short Int. Change
10/30/2009. 8,427,630 +0.4%
10/15/2009. 8.398,235
Human Genome Sciences Inc. (NASDAQ: HGSI)
AS OF DATE Short Int. Change
10/30/2009. 17,160,491 -4.5%
10/15/2009. 17,967,328
Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN)
AS OF DATE Short Int. Change
10/30/2009. 10,199,665 -17%
10/15/2009. 12,347,842
OSI Pharmaceuticals Inc. (NASDAQ: OSIP)
AS OF DATE Short Int. Change
10/30/2009. 5,415,588 +4%
10/15/2009. 5,212,729
JON C. OGG
NOVEMBER 11, 2009
Sepracor: A Thought Of A Higher Price… (SEPR, CBST, ONXX, GERN, VNDA, REGN, SGEN, ALNY)
It is common that when mergers are announced that some shareholders are either unsatisfied or want more. Sepracor Inc. (NASDAQ: SEPR) and its proposed $2.6 billion sale to Dainippon Sumitomo Pharma Co. might not be enough to satisfy everyone involved in the shareholder side of the deal. That is the case if you read a Bloomberg report from Tuesday night and this could be the first of many such suits.
It appears that the allegations are that the terms of the merger are detrimental to shareholders because of a break-up fee and shopping provisions. This is an effort either to block the merger or to secure a higher price and better terms. So here is how the $23.00 stacks up… It was a 27.6% premium to the September 1 price, but was a 48% premium to the 6-month average.
This deal does make-whole anyone who bought shares over the last year. But it comes with a huge hit for many investors who have been in it for the long-term. From the end of 2004 to mid-2007 this was generally a $40 to $60 stock. Then it was a $30 stock and the stock was in the low $20’s to $30 for most of the period from mid-2007 to mid-2008.
If you look at the deal on a valuation basis, it seems very cheap. The Thomson Reuters figures for 2010 are $2.91 EPS and $1.26 billion in revenues for 2009 and $2.99 EPS and $1.31 billion in revenues for 2010. In short, The company is selling for less than 8-times a blended earnings estimate and just over 2-times revenues for a blended time horizon.
Any time a merger is seemingly based upon a 52-week high, it is hard to feel too sorry for investors. At least until you start looking at the multiple of earnings being so low. We screened recently for all of the low P/E stocks in drug and biotech and there are still many other low P/E multiples in there.
We also are putting together another piece right now containing the following stocks as merger candidate discussions:
- Cubist Pharmaceuticals Inc. (NASDAQ: CBST)
- Onyx Pharmaceuticals Inc. (NASDAQ:ONXX)
- Geron Corporation (NASDAQ: GERN)
- Vanda Pharmaceuticals, Inc. (NASDAQ: VNDA)
- Regeneron (NASDAQ: REGN)
- Seattle Genetics Inc. (NASDAQ: SGEN)
- Alnylam (NASDAQ: ALNY)
JON C. OGG
SEPTEMBER 9, 2009
More Biotech/Drug Mergers Coming? (SEPR, CBST, ONXX, GERN, VNDA, REGN, SGEN, ALNY)
This week came a merger of at least one of the drug and biotech players we expected to occur. That was in Sepracor (NASDAQ: SEPR). We will be putting together a list of much more detailed picks in teh sector this coming week.
Some of these are our own picks which we think should be acquired, and some are current biotech-drug targets which others feel are on deck. To see the full deal on how this related, BioMedReports.com has a full breakdown on teh Spreacor terms and we used this for determining value on some of our other picks….
Among the picks being presented in detail next week are as follows:
Cubist Pharmaceuticals Inc. (NASDAQ: CBST)
Onyx Pharmaceuticals Inc. (NASDAQ:ONXX)
Geron Corporation (NASDAQ: GERN)
Vanda Pharmaceuticals, Inc. (NASDAQ: VNDA)
Regeneron (NASDAQ: REGN)
Seattle Genetics Inc. (NASDAQ: SGEN)
Alnylam (NASDAQ: ALNY)
Have a great weekend and stay tuned for the full details on these and others next week.
JON C. OGG
SEPT. 4, 2009
Geron Delay Dulls Stem Cell Sector (GERN, ASTM, CYTX, NBS, STEM, KOOL, OSIR, LIFE, CCEL)
Geron Corporation (NASDAQ: GERN) has some bad news in the land of stem cell investors. The stem cell leader has announced that its Investigational New Drug application for a cell therapy for neurologically complete, subacute spinal cord injury has been placed on clinical hold by the FDA pending the agency’s review of new nonclinical animal study data submitted by the company. This is an order that the FDA issues to a sponsor to delay a proposed trial or to suspend an ongoing trial.
As a reminder, no patients have yet been treated in this study. But this has investors spooked, even if it is just for a review of additional data. Stem Cell stocks often move hand in hand, and these are the other issues to watch on the news:
- Aastrom Biosciences, Inc. (NASDAQ: ASTM)
- Cytori Therapeutics, Inc. (NASDAQ: CYTX)
- Neostem, Inc. (NYSE: NBS)
- StemCells Inc. (NASDAQ: STEM)
- Thermogenesis Corp. (NASDAQ: KOOL)
- Osiris Therapeutics, Inc. (NASDAQ: OSIR)
- Life Technologies Corporation (NASDAQ: LIFE)
- Cryo-Cell International, Inc. (OTC Bulletin Board: CCEL)
Geron noted that the company has been undertaking studies to enable dose escalation of its spinal cord injury product and has also been investigating application of the product to other neurodegenerative diseases.
The company has also been performing additional product characterization and conducting further animal studies and the data from this work has been submitted to the FDA. Geron said that it will work closely with the FDA to facilitate the review of the new data and to release the clinical hold.
JON C. OGG
AUGUST 18, 2009
Diabetes Drug War Heats Up (NVO, AMLN, LLY, MNKD, PFE, SPEX, VVUS, GNBT, BMY, AZN, ARNA, GERN, STEM, OREX, HDIX, PODD)
Over the last couple of weeks, there has been quite a bit of new data in the drug war in the fight against diabetes. New studies have been updated, earnings projections have been made, FDA dates have been telegraphed and more. While these are still far short of ultimate cures, the war against diabetes may have many new or improved treatments out sooner rather than later. We originally discussed one or two of the key upcoming treatments pending for the eight major diseases and conditions as “the next $170 billion opportunity” and this is a much deeper dig into that broad initiation. We have included many of the recent developments in the potential treatments for obesity as well, considering that Type II diabetes and obesity are frequently conditions tied directly to each other.
According to the Journal of Health Affairs, the figure on obesity for Americans is a whopping $147 billion per year in total medical costs. This comes to 10% of all healthcare spending. The figure from the U.S. Centers for Disease Control was some $116 billion spent domestically on treating diabetes in 2007. As this is a lengthy bit, we have not included some of the other treatments that have been in use or that were recently flagged because of reports of higher chances of cancer rates associated by the long-term use of these.
FDA & IMMEDIATE ACTION
There is a new diabetes hopeful that is supposed to be coming sooner rather than later. Novo Nordisk (NYSE: NVO) reported a 21% gain in earnings in the last week and said that it expects the FDA to make a decision on its next-generation diabetes drug Victoza (liraglutide) in a matter of weeks. The company’s CFO and CEO both indicated that the Danish company does expects a positive response from the FDA and we heard a August to September expectation. Novo Nordisk has already launched Victoza in England, Germany and Denmark last month and expects to release it in other European Union countries throughout 2009 and into 2010. The benefit is that this one doesn’t risk pushing blood glucose levels to counts which are dangerously low and it also helps users lose weight. Novo Nordisk said it has priced Victoza competitively with Byetta from Amylin Pharmaceutical, Inc. (NASDAQ: AMLN) and Eli Lilly (NYSE: LLY). After the earnings and after shares were still close to 52-week highs, we saw analyst downgrades on Friday for Novo Nordisk by both UBS and by J.P. Morgan.
The drug still expected the next big new release with Blockbuster potential is an inhalable insulin from MannKind Corp. (NASDAQ: MNKD). Afresa is to be its name. Despite past woes of inhalable insulin, MannKind shares were hitting 52-week highs in June and its shares are still up 20% from three months ago. A late-stage study showed that Afresa’s performance was similar to injectable insulin. The company recently sold a 7.4 million shares secondary offering to raise cash for this launch, and its CEO took 1 million shares of the offering. The thought was that MannKind would secure a partner for marketing and development, but the recent stock offering gives it more internal options ahead of what is believed to be a Spring-2010 FDA approval action. Pfizer Inc (NYSE: PFE) has been thought of as a partner as it moved Exubera inhaled-insulin patients to MannKind’s experimental product. The two companies had been partners until Pfizer pulled Exubera from the market in 2007.
There is also a huge opportunity for the once per week dosing. We are not yet convinced that this can be a universal next generation treatment, however this might be fine for many of the lower grade cases if you can refer to any diabetes cases as lower grade. Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN), Eli Lilly (NYSE: LLY) and Alkermes Inc. (NASDAQ: ALKS) have had a recent New Drug Application accepted by the FDA for review. Exenatide is an investigational sustained release medication for type 2 diabetes that would be injected once per week and is the active ingredient in BYETTA. We are not alone in this thought, but Amylin is a company which many have thought would be acquired for years now when considering the link of diabetes and obesity.
VIVUS, Inc. (NASDAQ: VVUS) has a substantial shot here with Qnexa, its Type 2 diabetes treatment through weight loss assistance. The stock recently came off on worries of its risk factor language that may have to be disclosed, but it showed a 9.4% weight loss or over 20 pounds observed in patients. The DM-230 study was a 56-week study assessing the impact of Qnexa on glycemic management in 130 obese patients. The 10-site study was comprised of 90 females and 40 males with an average age of 50 who had Type 2 diabetes, and a majority of the patients had been diagnosed with diabetes for more the five years and were taking two or more oral diabetes medications. In the phase II and phase III clinical trials, Qnexa demonstrated glycemic control, significant weight loss, and an improvement in cardiovascular risk factors. VIVUS is also presenting data at a brokerage firm conference this coming Thursday. The company’s market cap is still just under $500 million and its most recent balance sheet had north of $144 million in cash and equivalents with very little long term debt.
Bristol-Myers Squibb (NYSE: BMY) and AstraZeneca (NYSE: AZN) have recently received FDA approval for Onglyza as an adjunct to diet and exercise to improve glycemic control in adults with type 2 diabetes. This Onglyza is a once-daily dipeptidyl peptidase-4 (DPP4) inhibitor that can be used in combination with commonly prescribed anti-diabetic medications or on a standalone basis as a monotherapy to significantly reduce glycosylated hemoglobin levels.
MORE OBESITY CANDIDATES COMING
Several biotechnology companies are working on the next wave of obesity candidates, as noted above in VIVUS’s Qnexa. Arena Pharmaceuticals, Inc. (NASDAQ: ARNA) has Lorcaserin, Orexigen Therapeutics, Inc. (NASDAQ: OREX) has Contrave, and Amylin Pharmaceuticals Inc. (NASDAQ: AMLN) has pramlintide. Orexigen’s Contrave has completed phase III trials and our time line for when the company will file for approval is in early 2010. The company is presenting data this Thursday at the Canaccord Adams Global Growth Conference. VIVUS’s Qnexa is currently in two phase III programs with a new drug application expected around the middle of 2010. Amylin’s pramlintide and metreleptin are currently in phase IIb.
We have the expectation that Arena will have a first-mover advantage with an NDA planned before the end of 2009. Certainly, any delays or advances could change the status of the front-runner category leadership. Arena’s near-term catalyst is the release of the phase III BLOSSOM data out in September 2009, which will be used as part of a supplemental NDA in late 2009 or into 2010. This still leaves a year or more for final FDA action from now. Arena shares surged in late-July after reporting that its obesity results met the three endpoints.
STEM CELLS
Stem Cell therapy offers a huge promise, but so far that looks to be years out and the promise is actually more of a hope for the time being. Geron Corporation (NASDAQ: GERN) is in the research stage of using stem cells in evaluation of Type 1 diabetes. The exact level of this study is not as far as along as some of its cancer and spinal studies, but this is one of the few stem cell companies that have dedicated part of their mission to diabetes. StemCells Inc. (NASDAQ: STEM) also has a Pancreatic Program concentrating its efforts on Type-I diabetes. Its goals are to identify, isolate, and culture pancreatic stem and progenitor cells, and to test their therapeutic potential.
While we at BioHealthInvestor would love to hold hope and promise for stem cells, we would not be hoping for stem cell treatments any time in the near future. While some positive notions have been noted in the stem cell sector, the National Institute of Health noted, “Over the past several years, doctors have attempted to cure diabetes by injecting patients with pancreatic islet cells—the cells of the pancreas that secrete insulin and other hormones. However, the requirement for steroid immunosuppressant therapy to prevent rejection of the cells increases the metabolic demand on insulin-producing cells and eventually they may exhaust their capacity to produce insulin. The deleterious effect of steroids is greater for islet cell transplants than for whole-organ transplants. As a result, less than 8 percent of islet cell transplants performed before last year had been successful.”



