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Biotech Stock Mailbag: Galectin, Keryx, Navidea, Cytori

AndersPLV asks:

I haven't read anything by you about Galectin so I wonder if you could share your opinion on their drugs and outlook for the future. Thank you.

Two years ago, Galectin was known as Pro-Pharmaceuticals, a troubled and almost bankrupt penny stock developing drugs made from fruit pectins. These drugs are supposed to bind to and block galectins -- a family of glue-like proteins thought to be associated with various diseases when found at elevated levels in the body.

I'm being kind to describe Pro-Pharma as irresponsibly promotional and scientifically inept. During the mid-2000s, the company tried to develop its lead galectin inhibitor known as Davanat as a boosting agent for the chemotherapy 5FU in colon cancer. Despite a series of phase 1 and phase II studies which showed little clinical activity, Pro-Pharma claimed in June 2007 it was in the process of seeking FDA approval for Davanat.

Pro-Pharma continued to spin the Davanat FDA submission story through the rest of 2007 and almost all of 2008. The charade ended in early 2009 when the company admitted FDA asked for a phase III study of Davanat in colon cancer to be conducted. Pro-Pharma spent the next two years stringing investors along about plans to conduct the Davanat phase III study, which never happened.

In 2011, Pro-Pharma changed its name to Galectin. This history lesson is relevant because Davanat also underwent a cosmetic make over. The failed colon cancer drug is now being developed by Galectin under a new moniker, GM-CT-01.

Same exact drug, different name, new story. The chemotherapy adjuvant hypothesis was pitched overboard. Galectin is now developing GM-CT-01 under the theory that it's a cancer immunotherapy capable of activating a patient's T cells to identify and eradicate tumors.

Cancer immunotherapy is a hot trend right now, so I'm not surprised to see Galectin glom on. Unfortunately, a proof-of-concept study of GM-CT-01 in melanoma patients has so far yielded no objective responses.

Galectin is also developing a second galectin inhibitor, GR-MD-02 as a treatment for liver fibrosis. A phase I study is underway, with interim results expected in January. GR-MD-02 shares many traits with another galectin inhibitor known as GCS-100, now owned by La Jolla Pharmaceuticals, a penny stock trading on the bulletin boards. GCS-100 was developed by two companies, each bankrupted, before landing in La Jolla's pipeline.

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