Given his history, Adams could be dressing up Auxilium for a sale.
Before that happens, Adams probably has to set a course for faster growth from Xiaflex and stabilize Testim sales. Once that's done, Auxilium could be ripe for a sale. All this makes Auxilium an interesting stock to follow for the next year.
Aveo is developing the kidney cancer drug tivozanib, currently under review at the FDA with an approval decision date of July 28, 2013. Investors have been punishing the stock because of worries about the approvability of tivozanib. In a pivotal phase III study, tivozanib delayed tumor progression and demonstrated a better safety profile than
Nexavar, but overall survival was greater for Nexavar than tivozanib.
Aveo has tried to explain away the survival benefit conundrum, insisting that patients treated with Nexavar in the pivotal trial "crossed over" to treatment with tivozanib as well. Still, the controversy has created an overhang on the stock.
Last week, Aveo CEO Tuan Ha-Ngoc purchased 75,000 shares of Aveo stock. Three directors also bought shares, including Henri Termeer, the former CEO of Genzyme. These insiders obviously betting that the FDA will approve tivozanib.
While many companies try to explain away doubts about clinical trial results, it's rare to see executives and directors talk with their wallets by buying significant amounts of their own stock. That's what Aveo insiders have done.
It will be quite interesting to see what happens next summer when tivozanib comes up for FDA approval. Before the decision, FDA is likely to convene an advisory panel to review the pivotal trial data. The confounding survival results will definitely be debated.
Rosenblum is long Auxilium and Aveo.