Pharma Insight

2006-10-17T08:09:00.000-07:00

Forest Laboratories (FRX.N: Quote, Profile, Research) on Tuesday said fiscal second-quarter earnings rose on higher revenue from drugs to treat depression and Alzheimer's disease, and its raised its 2007 forecast.

The New York-based company said it earned $241 million, or 75 cents per share, compared with $205 million, or 59 cents per share, in the year-ago period.

Quarterly results include a $9.1 million charge.

The company boosted its forecast for the year ending March 31, 2007 to $2.60 to $2.65 per share, from a previous view of $2.45 to $2.50 per share.

Quarterly revenue rose to $847 million from $736 million a year earlier.

2006-10-17T01:51:00.000-07:00

Diversified health care product maker Abbott Laboratories Inc. reports earnings for the fiscal third quarter on Wednesday. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: In July, the company gained its third approved use for its best-selling drug Humira. Already approved for rheumatoid arthritis and psoriatic arthritis, Humira was approved to treat ankylosing spondylitis, an inflammatory disease of the spine and spinal joints.

In late September, Abbott and Boston Scientific were targeted by a lawsuit filed by Johnson & Johnson. The suit alleged the Abbott and Boston Scientific benefited from a leak within medical device maker Guidant that helped them bid to buy the company. Boston Scientific's bid was successful, and the company divested Guidant's stent business to Abbott. Guidant had already agreed to be purchased by Johnson & Johnson.

EXPECTATIONS: Abbott forecast third-quarter earnings of 57 cents to 59 cents. Analysts surveyed by Thomson Financial estimate earnings of 58 cents per share on revenue of $5.48 billion.

ANALYST TAKE: Citigroup's Matthew Dodds, who rates the company a "Sell," on Friday raised his earning-per-share estimate by a penny to 57 cents on sales of $5.44 billion and predicted results "should remain uninspiring."

Banc of America's Glenn Novarro, who rates Abbott "Buy," was forecast below-consensus earnings of 57 cents per share on sales of $5.49 billion.

WHATS AHEAD: At the beginning of the fourth quarter, Abbott said it would no longer pursue its Zomaxx drug-coated stent in favor of the acquired Xience V stent, causing some analysts to lower Abbott's projected market share.

Prudential Equity analyst Larry Biegelsen, who rates Abbott "Overweight" and forecasts earnings per share of 58 cents for the third quarter, said he expects Humira to keep driving drug revenue until 2009 and the acquisition of Guidant to boost earnings in 2007, but forecast that shares should stay put in the near-term with profit taking and uncertainty over the November elections.

STOCK PERFORMANCE: Shares of Abbott rose nearly 14 percent to close the third quarter at $48.56 on the New York Stock Exchange. Since the beginning of the year, the stock has increased by 23 percent.

2006-10-16T20:51:00.000-07:00

Diversified health care products maker Johnson & Johnson reports earnings for the fiscal third quarter on Tuesday. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: In the third quarter, analysts started curtailing sales estimates for drug-coated stents as studies began circulating showing the devices raised the risk of blood clots. Also, in late September, J&J sued Boston Scientific and Abbott Labs for $5.5 billion in damages, alleging that acquisition target Guidant leaked confidential information during a bidding war that J&J eventually lost.

EXPECTATIONS: J&J forecast that third-quarter earnings should not exceed 93 cents per share, and analysts surveyed by Thomson Financial estimate earnings per share of 93 cents on revenue of $13.08 billion.

ANALYST TAKE: Banc of America analyst Glenn Novarro expects earnings per share of 95 cents on sales of $13 billion with slightly stronger drug sales of $5.7 billion watered down by weaker-than-expected stent sales. Prudential Equity's Larry Biegelsen figures the company will reach the consensus of 93 cents per share with sales of $12.94 billion.

WHAT'S AHEAD: Wall Street will continue to look for updates as J&J integrates the $16.6 billion acquisition of Pfizer's consumer products business. Also, upcoming medical conferences and an FDA panel on drug-coated stents are expected to keep pressure on sales of the devices because of raised safety concerns.

STOCK PERFORMANCE: Shares of J&J rose 8 percent over the third quarter to close at $64.94. Shares are also up about 8 percent for the year.

2006-10-15T19:00:00.000-07:00

UnitedHealth (UNH) said Chairman and Chief Executive William McGuire is stepping down as part of a shake-up of its senior ranks following an investigation into the backdating of past stock option awards. McGuire quit Sunday as chairman, and he will resign from the CEO post by Dec. 1. Until then, he will remain CEO to assist in the transition, UnitedHealth said. Replacing McGuire as chief executive will be Stephen Hemsley, the current president and chief operating officer who joined the company in 1997. At the same time, the company created the position of nonexecutive chairman of the board and said Richard Burke, the founding CEO of UnitedHealth and a director since 1977, will take the post immediately. McGuire though, wasn't the only executive on his way out of the health insurer. The board also accepted the resignation of director William Spears, and said David Lubben will proceed with his plans to retire and is stepping down as general counsel and secretary. Hemsley has voluntarily agreed to reprice all options awarded through 2002 to the annual high share price for each year, and "to take any other appropriate action to eliminate any possible financial benefit from options-related issues" found during the options probe. Additionally, McGuire will reprice all the options he received from 1994 through 2002 to the annual high share price for each year. UnitedHealth's board will have five seats filled by new independent directors during the next three years, and a new senior executive position of chief legal officer will be established. The company will also have a chief ethics officer among its senior executives. Going forward, the company will eliminate the authority of management to make equity awards. From now on, broad-based equity awards to executives and employees will occur annually and will be approved at the board meeting that generally coincides with UnitedHealth's annual meeting. UnitedHealth reaffirmed its previously issued guidance for the remainder of 2006 and for 2007, and it plans to hold its quarterly earnings conference call on Oct. 19, as scheduled. However, the company will likely delay filing its third-quarter Form 10-Q with the Securities and Exchange Commission. UnitedHealth hasn't determined whether any restatements of will be required.

2006-10-12T11:48:00.000-07:00

FDA Warns BioMarin Pharmaceutical Over Claims on a Web Site Promoting Orapred Drug

- Federal health officials sent a warning letter to BioMarin Pharmaceutical Inc. Wednesday, saying a company Web site makes unsubstantiated claims for the liquid form of the drug Orapred, a steroid used to reduce inflammation in asthma and other conditions.

In the letter from the Food and Drug Administration dated Oct. 11, the agency says BioMarin's Web site "suggests Orapred is safer and more effective than has been demonstrated." According to the agency, the company fails to highlight risks of taking the drug, which is known to cause mood swings and is contraindicated in patients with systemic fungal infections. The Web site also does not mention adverse reactions associated with the drug, which include fluid retention, hypertension, increased appetite and weight gain.

Orapred is primarily used to treat asthma in children because it contains flavor additives to mask the taste of its active ingredient, prednisolone. The drug is also prescribed to control inflammation from other conditions, including types of dermatitis and drug hypersensitivity.

In the warning letter, FDA takes issue with claims that the drug's flavor makes it easier to take. According to the agency, "these claims misleadingly suggests that because of its formulation, patients gag less often when taking Orapred." FDA says there is no documented evidence to support the claim.

BioMarin said Thursday it will comply with FDA by taking the site down immediately. Company spokesman Joshua Grass said BioMarin was surprised by the warning letter because FDA reviewed the content of the site last year and found no problems.

The company entered a North American licensing agreement for Orapred with privately held Alliant Pharmaceuticals in March 2006. In August Biomarin reported receiving a $7.5 million payment from Alliant under the agreement.

Shares of BioMarin Pharmaceutical rose 8 cents Thursday to $16.54 in midday trading on the Nasdaq.

2006-10-11T12:59:00.000-07:00

Biovest International Gets Orphan Drug Designation for BiovaxID in Europe

Biovest International Inc., which is majority-owned by drug developer Accentia Biopharmaceuticals Inc., said Wednesday that a European commission registered its BiovaxID therapy as a rare disease treatment, conferring market exclusivity to treat a rare cancer.

The company said the Commission of the European Union entered BiovaxID into the Drug Register for Rare Diseases for Follicular Lymphoma, an immune system cancer where the disease is grouped in clusters in the lymph node. The designation follows a recommendation by a European Medicines Agency committee to make BiovaxID an orphan drug for the disease.

Orphan drug status in Europe gives the company 10 years of marketing exclusivity for the specific drug use upon approval, along with reduced filing fees and regulatory assistance.

Accentia shares rose 22 cents, or 8.9 percent, to $2.66 in afternoon trading on the Nasdaq. Since going public on Oct. 28, the stock has changed hands between $1.96 and $8.86, and is off nearly 52 percent year-to-date.

2006-10-07T13:37:00.000-07:00

Analysts expect biotechnology companies to report mixed third-quarter earnings with several pointing out that revenue increased but the sector still lagged in growth compared with the rest of the market.

Without any sweeping industrywide factors hampering or boosting stocks, companies faced a divergent mix of issues during the quarter, but sales of key drugs will help most companies to meet or beat expectations, several analysts said in forecasts for the quarter.

The sector itself held steady. The American Stock Exchange's biotechnology index posted a 6 point gain between June 30 and Sept. 30, marking a leveling out after a losing 46 points in the previous quarter.

Analysts cited industry sales data in giving a mixed assessment on company returns. But overall they thought sales from several key drugs would mark profitable quarters for companies like Genentech Inc. and Gilead, and many are expected to match Wall Street expectations. Also, higher enrollment figures in the Medicare Part D prescription drug program could be a sales-boosting factor for several companies.

Drug developer Genentech Inc. kicks off earnings season Oct. 10. Based on sales data for its cancer drugs analysts expect the company to post another strong quarter. Also, the company received approval for its age-related blindness drug Lucentis just before the start of the quarter and is tracking ahead of sales expectations.

Morgan Stanley analyst Dr. Steven Harr expects Genetech's Avastin sales to meet Wall Street expectations in the mid-to-high $440 million range, but said sales could be higher, reaching his estimate of $460 million. Other drugs, including Rituxan and Lucentis, are also poised to meet estimates.

Analysts polled by Thomson Financial expect the company to earn 50 cents per share on revenue of $2.31 billion.

Genzyme Corp. is expected to post revenue and earnings in line with Wall Street. Analysts expect earnings of 71 cents per share on revenue of $819.6 million.

Sales of its kidney disease treatment Renagel likely received a boost from more patient enrollment under the Medicare D prescription drug plan, said Merrill Lynch analyst Eric Ende. He's expecting worldwide sales of Renagel to total $130 million for the quarter, making it the company's best-selling drug.

Genzyme will report results Oct. 12.

Gilead Sciences Inc. plans to post third-quarter results Oct. 18, with high expectations for its once-a-day HIV pill Atripla. The drug is a combination pill that includes two Gilead drugs. Sales were moving above estimates as of August, according to Rodman & Renshaw analyst Michael King Jr.

Jefferies & Company analyst Eun Yang expects the company to post results in line with or slightly above Wall Street expectations. Analysts on average forecast profit of 56 cents per share on revenue of $705.2 million.

"We expect Gilead to deliver a solid quarter driven by continuing strong sales in its HIV franchise," Yang wrote in a note to investors.

Cubist Pharmaceuticals Inc. will also report its third-quarter results Oct. 18, and analysts expect profit of 4 cents per share on revenue of $54.3 million. The stock will likely see a boost from on-target sales of its staph infection drug Cubicin, Yang said.

2006-10-04T13:53:00.000-07:00

Canadian regulators approved the drug Tysabri for the treatment of relapsing-remitting forms of multiple sclerosis. The drug is sold by U.S. company Biogen Idec (BIIB) and Ireland's Elan (ELN) . Biogen Idec was up $1.02, or 2.3%, at $45.90, and Elan was adding 14 cents, or 0.9%, to $15.70.

2006-10-03T17:17:00.000-07:00

The U.S. Patent and Trademark Office has granted a request by consumer groups to re-examine patents that give the University of Wisconsin's Alumni Foundation the exclusive rights to all human embryonic stem cells used for research.

The consumer advocates contend the patents require any researcher in the United States working with embryonic stem cells – whether at a university, private research lab or drug discovery company – to pay exorbitant fees and adhere to such restrictive guidelines that researchers are effectively being “handcuffed.”

In a letter to the Wisconsin Alumni Research Foundation WARF, the patent office said it found the consumer groups raised “substantial questions” as to whether all three patents on embryonic stem cells should have been issued.

“We're pleased the PTO has decided to re-examine these patents,” said John M. Simpson, of the Foundation for Taxpayer and Consumer Rights in Santa Monica. “The patents should never have been issued in the first place.”

Joining in the request for a re-examiniation is the New York-based Public Patent Foundation and Jeanne Loring, a stem cell researcher at the Burnham Institute in La Jolla.

Officials at the Wisconsin foundation could not be immediately reached for their response.

Although there are 1.5 million patents active in the United States, the patent office receives only 400 to 500 request annually to re-examine patents, said Brigid Quinn, a spokeswoman for the office. A re-examination can result in no change to the patent or a dismissal of all or part of a patent.

She said about 90 percent of re-examination requests are granted.

Third party requests for patent re-examination, like the ones filed challenging the Wisconsin patents, are successful in having the patent either changed or completely revoked roughly 70 percent of the time, Simpson said.

2006-10-03T16:33:00.000-07:00

XOMA Ltd. Tuesday announced an agreement with Attenuon LLC to process an antibody for the company.

Berkeley-based XOMA (NASDAQ XOMA) will use technology it has developed to "humanize" the antibody, making it suitable for use in humans.

Attenuon, a San Diego-based clinical-stage biopharmaceutical company, will pay XOMA an upfront fee, developent milestones and royalties. Further details of the deal were not disclosed.

XOMA's chairman of the board, president, and CEO, Jack Castello, said in the announcement that the agreement is another step forward for XOMA in making its humanizing technology a significant line of business. XOMA announced a $6 million agreement on Sept 28 to manufacture and supply an antibody processed by the same technology for AVEO Pharmaceuticals Inc., of Cambridge, Mass.

XOMA shares were up 2.66% to $1.93 in trading on the Nasdaq.

2006-10-01T13:46:00.000-07:00

India would soon occupy the top position in the world in biotechnology if it maintained 40 per cent growth, Council of Scientific and Industrial Research (CSIR) Director General RA Mashelkar said on Sunday.

"As far as IT sector is concerned, the growth was touching all time high. However, it is the biotechnology sector which has begun to come out of the closet, recording an annual growth of 40 per cent for last three years," Mashelkar said while giving a broader view of the two-day conference, 'Hi-Tech Pune: Where IT meets BT', to be held from October 27.

The biotechnology sector's turnover in 2005 was $1.6 billion and India was placed number two among Asia-Pacific countries in the sector, he said, adding if the 40 per cent growth is maintained the sector, our country would soon occupy the top spot in the world.

There is a silent revolution taking place in biotechnology sector in Pune. Cyrus Poonawala's Serum Institute of India has recently displaced Bangalore-based company of Kiran Mazumdar to be number one biotech enterprise in the country, Mashelkar said.

2006-09-27T12:48:00.000-07:00

Merck & Co. on Wednesday said it would expand its research collaboration with FoxHollow Technologies Inc., which analyzes artery plaque for signs of cardiovascular disease, and would pay $95 million for an 11 percent stake in the company.

Shares of FoxHollow, a far smaller company which is based in Redwood City, California, surged 21 percent in afternoon trading.

"We now know that plaques have the same makeup whether they're in the heart, the kidneys or legs," Duke Rohlen, president of strategic operations for FoxHollow, said in an interview.

The companies together will sponsor clinical trials on patients with clogged leg arteries to better understand plaque, and thereby develop new drugs to treat plaque that clogs heart arteries.

Under the expanded partnership, Merck said it would pay FoxHollow $40 million over four years in return for the smaller company collaborating exclusively with Merck in specified disease areas.

Merck said it would also pay FoxHollow at least $60 million over the first three years of the four-year expanded deal for research under Merck's direction, including removal of atherosclerotic plaque from patient arteries for analysis, and for performing clinical trials of potential drugs.

"FoxHollow will receive milestone payments on successful development of drug products or diagnostic tests utilizing results from the collaboration, as well as royalties," the companies said in a joint press release.

Merck, which is based in Whitehouse Station, New Jersey, said it will buy FoxHollow's stock at $29.63 per share. That represents an 8.7 percent premium to FoxHollow's closing share price on Tuesday of $27.25.

The original deal between the two companies was struck in September 2005 and entitled FoxHollow to annual payments of $10 million for up to three years, Rohlen said.

"Going forward, the value to us could rise to $300 million," Rohlen said, including $100 million in additional payments from Merck if the collaboration lasts a full 15 years.

FoxHollow sells devices used by doctors to cut fatty deposits from leg arteries of patients with peripheral artery disease. If not cleared, the plaque can cut off blood flow to the legs and lead to amputations.

In Europe, the company also sells a product called Coronary Hawk that cuts plaque from arteries of the heart, an alternative to angioplasties and stents that clear blocked arteries through other means.

Rohlen said it will take another two years or longer for the FoxHollow heart product to be approved in the United States.

FoxHollow was up $5.76 to $33.01 on the Nasdaq, after reaching $35.72 earlier in the day. Merck was up 49 cents to $42.25 on the New York Stock Exchange.

2006-09-27T08:53:00.000-07:00

La Jolla Pharmaceutical Company announced today considerable progress on its Phase 3 trial of Riquent® (abetimus sodium) for the treatment of lupus renal disease. Since the August 9, 2006 announcement that the study had been reactivated, the Company has added another 27 clinical trial sites able to screen and enroll patients, for a total of 58 sites, 22 in the United States and 36 in Asia.

Ninety-nine patients are currently being screened for potential enrollment in the study. We estimate that 30% to 50% of the patients in screening should be eligible for study enrollment.

In addition to sites in Asia and the U.S., sites are being added in Europe, Mexico and possibly South America, to bring the total number of sites to approximately 100. These sites are targeted to enroll patients before the end of 2006.

"We are aggressively moving forward to open new sites and enroll patients, and I am pleased that in only six weeks, we already have 99 patients in screening," said Deirdre Y. Gillespie, M.D., President and CEO of La Jolla Pharmaceutical Company. "We now plan to add at least 20 additional sites beyond the initial 100 to further accelerate and strengthen enrollment in the trial. We expect to begin activating these additional sites before the end of the year. Our target for completing patient recruitment is the second half of 2007."

This Phase 3 study is planned to enroll approximately 600 patients, and most of these patients will be treated with higher doses than in previous studies. This trial will assess a 300 mg per week and a 900 mg per week dose, as well as the 100 mg per week dose used in the prior Phase 3 trial. Of the 600 patients, two-thirds will be treated with Riquent, and the majority of the Riquent-treated patients will receive one of the two higher doses.

La Jolla Pharmaceutical Company is a biotechnology company developing therapeutics for antibody-mediated autoimmune diseases and inflammation afflicting several million people around the world. The Company's leading product in development is Riquent®, which is designed to treat lupus renal disease, a leading cause of sickness and death in patients with lupus. The Company is also developing small molecules to treat various other autoimmune and inflammatory conditions. The Company's common stock is traded on The NASDAQ Global Market under the symbol LJPC.

2006-09-27T08:51:00.000-07:00

Germany's Altana said it sold its stake in biopharmaceutical firm GPC Biotech to Goldman Sachs, two days after success in tests of GPC's main drug hope sent the stock up 40 percent.

Altana said on Wednesday it had sold the 7.1 percent GPC stake to investment bank Goldman Sachs . Investment banks typically buy shares in companies and place them with institutional investors at a later date.

An Altana spokesman said the selling price "did not differ strongly" from the current market value of the 2.36 million shares, which Altana said was around 36.3 million euros ($46.06 million).

Altana decided last week to sell its drugs unit to Danish group Nycomed for 4.5 billion euros ($5.71 billion). Proceeds from the sale are expected to be distributed to Altana shareholders in the coming year.

In future it will focus on its chemicals business, which it has said it wants to grow through both organic means and acquisitions.

GPC Biotech, which is listed on the German technology index <.TECDAX>, said on Monday that it expected to submit satraplatin for U.S. approval as a treatment for prostate cancer after tests proved successful.

GPC has said satraplatin could provide the company with peak sales of more than $500 million.

Shares in Altana were 0.8 percent lower at 44.23 euros by 1425 GMT, while GPC shares were 1.3 percent down at 15.20 euros.

2006-09-26T22:01:00.000-07:00

Peregrine Announces Issuance of Broad Patent Covering Vascular Targeting Agents in Combination Therapy Regimens
Tuesday September 26, 3:16 pm ET

- Extends Proprietary Protection for Peregrine's VTA Approach That Has Demonstrated Encouraging Anti-Cancer Potential in Preclinical Studies -

- Expands Peregrine's Technology Base and Opportunities for Technology Out-Licensing -

Peregrine Pharmaceuticals, Inc. a biopharmaceutical company with a portfolio of innovative, clinical stage products for the treatment of cancer and hepatitis C virus infection, today announced the issuance of a U.S. patent covering broad therapeutic uses of its Vascular Targeting Agent (VTA) technology platform in combination with standard treatments. Peregrine has in-licensed worldwide exclusive rights to the VTA technology, which includes the new patent, from UT Southwestern Medical Center. Peregrine is currently collaborating with UT Southwestern researchers to evaluate VTA constructs in preclinical studies for solid tumor therapy. In addition to its own research efforts, Peregrine can sub-license rights under the VTA technology platform on an exclusive or non-exclusive basis, and it has already licensed rights for use of VTA technology to a number of other companies.

"It is noteworthy that this key patent has issued soon after our collaborators reported additional encouraging animal data on the anti-cancer potential of our VTA approach," said Steven W. King, president and CEO of Peregrine. "This broad new patent further extends our U.S. intellectual property rights to cover VTA agents used in combination with standard cancer therapeutics -- both those VTA agents in preclinical development at Peregrine and similar approaches being developed by others. Extensive preclinical studies show that these agents are most effective in destroying tumors when used in combination regimens, so in effect these new claims mirror how we expect physicians to use these drugs in actual clinical practice. By covering these broad concepts of VTA therapy as well as the VTA agents themselves, this new patent provides additional impetus to our efforts to advance our VTA drug development and licensing programs."

Peregrine's VTA technology platform includes over 200 patents and patent applications covering broad concepts of tumor therapy using agents that target tumor blood vessels. The newly issued patent covers the therapeutic use of all regimens that combine agents specifically targeting tumor blood vessels with other anti-cancer agents, such as chemotherapy drugs.

"We believe that the breadth of this patent's allowed claims make it relevant to many of the researchers pursuing targeted combination therapy approaches based on destroying the essential blood supply of tumors," said F. David King, vice president of business development for Peregrine. "Sub-licenses to our VTA intellectual property will provide them with freedom to operate in this area, and this new patent should therefore be a valuable addition to our business development initiatives."

The patent, "Combined Methods and Compositions for Tumor Vasculature Targeting and Tumor Treatment," U.S. Patent No. 7,112,317, was invented by Philip E. Thorpe, professor of pharmacology at UT Southwestern Medical Center, and Francis J. Burrows, and issued today, September 26, 2006.

About Peregrine Pharmaceuticals

Peregrine Pharmaceuticals, Inc. is a biopharmaceutical company with a portfolio of innovative product candidates in clinical trials for the treatment of cancer and hepatitis C virus (HCV) infection. The company is pursuing three separate clinical trials in cancer and HCV infection with its lead product candidates bavituximab and Cotara®. Peregrine also has in-house manufacturing capabilities through its wholly owned subsidiary Avid Bioservices, Inc.