Feuerstein's Biotech-Stock Mailbag

The FLEX study combines Erbitux with the chemo drugs cisplatin and vinorelbine, which aren't used much in the U.S. Is that going to be a problem?

Perhaps. It is a risk and something to watch for. Doctors I've spoken with say they'd be comfortable using Erbitux with cisplatin and vinorelbine, or switching to a chemo backbone like carboplatin and taxotere, more commonly used here. In short, there is a feeling that the chemo is interchangeable, but then, it's still a bit unknown, so again, a risk.

Risks? Now you're getting me nervous. What else could go wrong?

The Erbitux survival data could hug close to that four-week line, which at this point, would probably be disappointing to a lot of investors. ASCO has a way of pumping up expectations (rightly or wrongly) for cancer stocks, especially in the case of ImClone since the FLEX data are being presented at a plenary session. While four-week survival would still be clinically meaningful and the drug would be used, in Wall Street's eyes, it might disappoint.

There also will be a lot of attention paid to Erbitux's efficacy in the various subtypes of lung cancer patients enrolled in the trial. Pay close attention to those squamous lung cancer patients because they make up the biggest potential pool of patients for Erbitux.

Biotech stocks like ImClone are so volatile, especially around big data presentations and meetings like ASCO. How the heck does the little guy know what to do?

Agreed, these stocks can be a heart-pounding ride. The way I look at ImClone this year is similar to what happened to Onyx Pharmaceuticals ONXX and the Nexavar-liver cancer data presented at last year's ASCO meeting. Going into the meeting, we knew the Nexavar data were positive but we didn't know precisely how positive, and there were a lot of skeptics and doubters both before the meeting and even after the (great) data were presented.

Despite a good bit of volatility, including a selloff after the ASCO meeting, Onyx rebounded and did very well. Heck, it was the best-performing biotech stock last year. Now, I can't guarantee that ImClone does the same thing this year, but many of the same ingredients are there, we just need to see the actual Erbitux lung cancer data and then gauge the reaction from lung cancer doctors.

What else does ImClone have cooking at ASCO?

The other major presentation will be on the effect that the KRAS gene has on the efficacy of drugs like Erbitux and others in the EGFR inhibitor class. (This includes Amgen's AMGN Vectibix and OSI Pharmaceuticals' OSIP Tarceva.)

I spent some time discussing the KRAS gene in a January Biotech Notebook, so check that out. Overall, the jury is still out on whether KRAS will have a positive, negative or neutral effect on the sales of drugs like Erbitux. We should have more clarity after the ASCO meeting.

All of this ImClone talk makes me think about Sam Waksal. Where is he?

Waksal, ImClone's former CEO, is still in the federal penitentiary, but he's actually slated for release in early August.

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