Dan M. writes, "I am wondering if you can revisit your analysis on Vanda Pharmaceuticals (VNDA) and Titan Pharmaceuticals (TTNP.PK). With initial Fanapt sales numbers due form Novartis in about one month, patent extension granted past 2020 on the injectable depot formulation and a likely rest-of-world partnership coming this year, I would like to know if your opinions or views of Vanda and Titan have improved, or if you still view them with a negative tilt."
I'm still skeptical about Novartis' ability to sell Fanapt into a crowded schizophrenia treatment market in the U.S. Vanda and Titan receive royalties on Fanapt sales from Novartis, so their valuations hinge almost entirely on the success or failure of the drug's commercial launch. I don't think any of the other factors mentioned by Dan matter more than Fanapt sales at this point.
At $12, Vanda's stock price is right where it was in October when the Fanapt partnership with Novartis was announced. By my reckoning, Vanda's stock price is already baking in $200 million to $400 million in Fanapt sales.
The Fanapt sales launch began in early January, so hopefully Novartis will say something about the effort on its first quarter conference call. But like Spectrum, it's going to take more than one quarter's worth of sales to get a clear picture of Fanapt's health in the market.-- Reported by Adam Feuerstein in Boston. Follow Adam Feuerstein on Twitter.
Correction: In last week's Mailbag column, the name of Generex' Oral-lyn was misspelled. It has been corrected. Also, it should be noted that Oral-lyn has been discussed in medical journals and presented at medical association meetings over the last ten years. TheStreet.com regrets the error.
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