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Biotech Stock Mailbag: MAP Pharma, Affymax

But if Nelson is understating FDA's concerns, intentionally or not, then Levadex's approval is not "de-risked." That puts MAP Pharma's current stock price at great peril.

One way to assess credibility is by looking back at the truthfulness of previous statements made by management. When it comes to the Special Protocol Assessment for the pivotal Levadex clinical trial, MAP Pharma execs have offered contradictory and misleading statements to investors.

As far back as January 2008, MAP Pharma executives were saying FDA had agreed to an SPA for the Levadex clinical trials. The company continued to claim a Levadex SPA through March 2010. After that, however, the SPA claim disappears, replaced with this tortured, attorney-crafted spin job plopped into the company's regulatory filings:

"FDA communicated its agreement with the design, execution, and analyses for our pivotal Phase 3 trial, which we submitted to the FDA under the Special Protocol Assessment, or SPA, process and modified as suggested by FDA… In March 2010, we held a pre-NDA meeting with the FDA to discuss the clinical portion of our anticipated NDA filing. The FDA's minutes of that meeting state that, while the FDA did not have a record of a formal SPA, the FDA concurred with the selection of our coprimary endpoints and confirmed that a second pivotal efficacy study was not necessary if topline efficacy results were confirmed during the NDA review. We believe that our prior written correspondence and interactions with the FDA under the SPA process constitute an SPA with the agency. The FDA may take a different view and could request additional safety and efficacy studies without having to identify a substantial scientific issue with our Phase 3 trial that is essential to determining the safety and efficacy of LEVADEX."

Given an opportunity on Tuesday's conference call to explain these confusing, contradictory statements about the Levadex SPA, MAP Pharma executives chose instead to dissemble further.

Another example of MAP Pharma execs unwilling or unable to go off-script: when hedge fund manager Kevin Tang asked Nelson to disclose the number of pages in the FDA's complete response letter.
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