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Biotech Stock Mailbag: Exact Sciences, Galena, Titan, Arena, Breakthrough Therapy

Joe G. asks, "Your opinion on Titan Pharmaceuticals (TTNP - Get Report) getting the nod from the FDA this month?"

The only reason FDA might not approve Titan's Probuphine for the treatment of opioid addiction on April 30 is if the two sides haven't had enough time to hammer out an acceptable risk-management plan. We know that the FDA objected to the Titan's proposed "REMS" plan in part because the agency wanted tighter controls on who can dispense Probuphine as well as better training for doctors implanting the buprenorphine-containing rods. Titan submitted a revised REMS plan last month, but as we heard at the advisory panel, FDA officials said finalizing the details of the revised plan before the April 30 approval decision date for Probuphine would be a challenge. [Experts sitting on that advisory panel voted 10-4 to recommend Probuphine's approval, with one abstention.]

FDA may still approve Probuphine on time, but I'd say Titan will still be happy -- and rightfully so -- if the FDA rejects Probuphine on April 30 citing only the need to complete negotiations on the REMS plan. A rejection asking for more clinical data on Probuphine -- perhaps tied to proper dosing of the implant -- would be far more of a negative for the company.

Titan shares at $1.74 are still lower than they were before the March 21 advisory panel. I suspect that investors are more concerned about Probuphine's commercial potential given the concerns about dosing and training required to implant the product aired during the panel. Anyone believing Probuphine could quickly grab significant market share in the $1 billion-plus opioid addiction treatment market was thrown a curve by the cautious comments made by addiction specialists at the panel. Titan and its partner Braeburn Pharmaceuticals face a challenging Probuphine launch, which is reflected in Titan's market valuation. Investors will want to see some evidence of successful sales before buying into the bull thesis.

@WCoastGuynCA tweets, "I own a lot of $ARNA shares. Patience is a virtue. I'm expecting $12 before the end of the month. Stay tuned."

Twelve dollars at the end of April would represent about a 50% move in Arena Pharmaceuticals's (ARNA - Get Report) stock price from its current price. Anything is possible, particularly in this biotech bull market, but probable? I have my doubts.
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