jfm1330 wrote: Theratechnologies, founded in 1993.
For many years they had no labs, they were buying patents from academic inventions, the patent to N-Hexenoyl; GRF (1-44), later called tesamorelin, and commercial name Egrifta was one of those patents. In the begining they were all over the place, they worked on a cancer treatment against leukemia that ended up in nothing, they started a medical device division, I remember they had an electronic stethoscope and other stuff. In the biotech boom in the 80s they were able to raise money. They started pushing tesamorelin as their lead drug, they also worked on a GLP-1 analog but were late in the game behind big competition so they dropped it after phase I. They bought a peptide desing company called Pharma-G, and hired the founder of this company as CSO. Nothing never came out of that acquisition.
Then, around 2010 they got tesamorelin approved by the FDA for a small indication, HIV lipodystrophy, and the company was forced into a partnership with EMD Serono over a patent that Serono had. So instead of a legal fight over that Serono patent, they concluded a partnership. Sales of Egrifta by EMD Serono were small, Thera was losing money in that bad deal because they still had to pay to run phase IV post-approval clinical trials and manufacturing. They also had manufacturing problems around 2012. They hired a new CEO, John Huss, a former big pharma executive. A financing in the US failed at that time when the company was on NASDAQ. It was the last window for the company to get a good amount of money without too much dilution. After that everything went south. They were low on money because of the failed financing, so they had to lay off about 80% of their employees. Went close to bankruptcy. Were savec by some tax credits reimbusment for the governments. The new CEO, long time CFO, Luc Tanguay managed to save the company in a deal to buy back from Serono the full rights to Egrifta. Then he managed to get the right to Taimed's Ibalizumab (Trogarzo) which, at the time, was about to enter phase III trial.
Trogarzo was finally approved by FDA in March 2018. The stock price went to 14$ (CAN) in May and June on high volume. Then it started to go down, and down, and down, and the sales of Trogarzo were minimal in the US. In other words a commercial failure. Thera also bought the rights for Europe, another failure. During all that time they managed to have Egrifta minimally profitable, and in Ferbruary 2019, Thera bought Katana Bioscience, a university startup with an oncology platform based on the peptide-drug conjugate aiming at a receptor called sortilin. The technology was still at the preclinical stage. Thera bought it for a few million dollars with the intent of investing in its clinical development.
Now we are in August 2022, Trogarzo is still a commercial failure, Egrifta is marginally profitable, the first PDC out of the SORT1 platform is in phase Ib with some efficacy signs out of a very long phase Ia. The phase Ib for this targeted therapy is done right now without screening patients for target receptor overexpression, which is the basic concept of the whole thing. So they run their trial based on probability of receptor overexpression. Not great.
So. If you are an investor new to Thera, and you do your due diligence on the history of this company, with what is publicly known right now, would want to buy the stock? At this time, with the long history of of failures and underachievments of this company, and what is publicly known at this time, do you think there is a reasonable way to honestly present things to make an appealing investment opportunity? Turn it the way you want, all lies on convincing oncology results, and at this point, there is so much noise in the phase Ia results, and there will be so much noise in the phase Ib results, that you really need to have a scientific background to understand what is known of the situation, and on top of that, you need faith. You need to believe that the little efficacy signal in all the noise is a real signal. You need to believe that they have something, and that once they will be able to reduce the noise significantly, the efficacy signal will be clear as day, and that it will be clear to everybody that they have a future FDA approved drug in their hands and maybe more than one drug because of the platform. But at this point, this positive scenario is not obvious at all.
So that's Thera yesterday and today. Sorry, but they need a dramaticly positive news in oncology to change the story and make it attractive.