I had the following instant conversation chat with an institutional biotech trader this week. The subject: Vivus (VVUS - Get Report) and the upcoming FDA approval decision for the weight-loss drug Qnexa. Trader: I think a very good risk of a REMS-like delay.
Me: Possible, but what does the stock do on that?
Trader: Stock dips, then buy the [bleep] out of that.
Me: At what point do you turn and short?
Trader: Two hours later? Maybe 10 minutes.
Referring to Threshold Pharmaceuticals (THLD - Get Report), @holdiday613 asks, "Any opinions on the TH-302 data?" The phase II data presented this week on Threshold's pancreatic cancer drug TH-302 were essentially in line with results pre-announced in February: A two-month benefit in progression-free survival from 5.6 months in the TH-302+gemcitabine arm compared to 3.6 months in the gemcitabine-alone arm. It was good see a positive dose response in the trial; better still will be an overall survival benefit, but we need to wait for later in the year for that data to mature. Relatively few patients in the gemcitabine arm crossed over to take TH-302, which may bode well for the survival analysis. Risks to a survival benefit: Some imbalances between the patient groups in the study, including performance status, which may have skewed the PFS benefit in TH-302's favor. Median overall survival for TH-302 in the 10-month range would be viewed positively. Threshold shares sold off this week, but that's not unexpected given the huge gains since the initial TH-302 results were announced in February. Threshold was the top-performing biotech stock in the first quarter. Looking ahead, watch to see if Threshold can convince FDA allow an approval filing based on this phase II study. It's a long shot, so I wouldn't count on it happening, but still, an early filing in pancreatic cancer without the need for a larger phase III trial would definitely send Threshold shares higher.