BOSTON (TheStreet) -- Travel and live blogging has kept the Biotech Stock Mailbag closed for the past two weeks. To make up for lost time, here's a special Tuesday edition of the Mailbag. Check back again Friday for more answers to your questions and comments.
William G. writes, "Adam, do you have any thoughts on Friday's article on Ziopharm Oncology (ZIOP) in Forbes by Richard Pearson? Put aside his timing, his motivations, etc., I was deeply troubled by some of the information he describes that I was heretofore unaware of."
Ziopharm issued a strongly worded response disputing the allegations in the Forbes article. Forbes subsequently removed the article from its web site. I'd consider the matter settled.
The bigger controversy hanging over Ziopharm is the implication, if any, from the ifosfamide/doxorubicin sarcoma study presented in September at the ESMO meeting. Ziopharm bears contend this study, which resulted in a statistically significant progression-free survival benefit but not overall survival, is a bad omen for Ziopharm and its similar phase III sarcoma study of palifosfamide.Top-line results from the palifosfamide study are expected before the end of the year. I think the bear argument against Ziopharm is stretched thin. The addition of ifosfamide to doxorubicin (ifo/dox) in front-line sarcoma resulted in a 68% reduction in the risk of disease progression compared to doxorubicin alone. (The hazard ratio was 0.74 and statistically significant.) Median PFS was 7.4 months for ifo/dox versus 4.6 months for dox alone. Overall survival was not improved, however. Ifo/dox reduced the risk of death by 17% compared to dox alone (hazard ratio of 0.83) but the survival trend was not statistically significant. At the median, overall survival was 14.3 months for ifo/dox versus 12.8 months for dox alone. Ifo is not easily tolerated so a high percentage of dropouts likely contributed to blunting the observed survival benefit trend. Based on these confounding results, the use of ifosfamide in the treatment of sarcoma patients was deemed unjustified. Ziopharm's PICASSO 3 sarcoma study compares the combination of palifosfamide and doxorubicin against doxorubicin. PFS is the primary endpoint, with results expected before the end of the year. If positive, Ziopharm intends to seek accelerated approval for palifosfamide, supported (hopefully) by survival data that will be mature next year. Is PFS an approvable endpoint in sarcoma for Ziopharm? Bears say PICASSO 3 is being conducted without a special protocol assessment from FDA, and the ifo/dox data discussed above suggest that a PFS benefit isn't enough for FDA approval. Ziopharm, therefore, won't win FDA accelerated approval based on PFS or will be forced to delay an approval filing until it has survival data in hand. I disagree. In April, FDA approved GlaxoSmithKline's (GSK) Votrient in sarcoma based on a statistically significant PFS benefit of three months over placebo. Granted, Votrient was approved in second-line sarcoma where Ziopharm is developing palifosfamide as a first-line treatment, but still, the idea that FDA won't approve a sarcoma drug without a survival benefit is just wrong. [Votrient did demonstrate a trend toward longer survival -- 12.6 months versus 10.7 months at the median -- but it wasn't statistically significant.] In planning the PICASSO 3 trial, Ziopharm assumed doxorubicin PFS of 4.3 months, so the 4.6-month PFS observed in the dox arm of the ifo/dox study is re-assuring. Ziopharm's target is a 40% reduction (hazard ratio 0.60) in the risk of tumor progression for palifosfamide/doxorubicin over doxorubicin alone. I see that as quite achievable and approvable.
On Amarin (AMRN) and Sarepta Therapeutics (SRPT), @ejs610 asks, "Are either a BO [buyout] candidate at this point?" Sarepta has better buyout potential because eteplirsen, if approved, will fundamentally alter the course of a rare, genetic disease that afflicts children. The pricing power and profitability derived from drugs addressing orphan diseases is very attractive to Big Pharma. Plus, Sarepta's exon-skipping technology has the potential to treat other genetic diseases beyond Duchenne muscular dystrophy. With Amarin, a suitor gets a single drug -- Vascepa -- that could be a blockbuster but will take a lot of marketing muscle and money to get there. Even so, the questionable strength of Vascepa's patents and the lack (so far) of five years of market exclusivity make the drug's commercial future hard to predict. It's hard to see Big Pharma stepping up to pay a big premium for Amarin right now. I'm not predicting a Sarepta takeout, at least not in the near term, but I do think the company is set up better in that regard than is Amarin.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV