ASCO 2009 and ThallionASCO 2009 and Thallion
Pharmas have reported mainly and mostly when their drug does not work.
Currently, cancer drugs are prescribed across board to all patients.
Market for cancer is 78 Billions, now a host of new testing/screening tools are out and cancer market could fall to 35 Billions on lower prescription.
To compensation Pharmas are using new combo and the “maintenance therapy approach”. Getting patients another few months by combining competing cancer drugs.
It’s a good short term solution.
Small Biotech breakthroughs are rare and most of them are already partnered.
The quantity of prospective un-partnered biotechs is few.
Right now, it’s a valuation debate between Pharmas and their targets. Some biotechs management are refusing to consider low offer bids.
On the other Pharmas are feeling the pressure even more so to get new pipeline, reduce R&D costs by acquisitions.
Buy the best class drug from a biotech, and drop your current less advanced or less promising drug candidates of the same class.
Thallion has been stalling for time since Dec 2009.
Buyer has been opportunistic and willing to buy before pivotal PII GBM results.
In Dec 2008, strategic review was open – no guidance provided for closure
On April 8, 2009 (Quarterly report) – Q2 was given as guidance for closure
End of May, IR tells shareholders that Q2 guidance is no longer valid and news will be released based on material disclosure policy.
My take:
Low ball offer in Dec 2008, TLN stalls for time by opening strategic review
Q1, some kind of deal was closed and management gave Q2 guidance
Now, ASCO 2009 brings confirmation to KRAS importance, combo approach and need to replace pipeline R&D cost by acquiring small players.
Considering current trends, I think shift back to no guidance for closure cannot be anything else but positive.
On a scientific level, XL-184 GBM trial is mixed – leaving door wide open for 4601. Nevertheless, Exelixis will fast track application and get Avastin-like accelerated approval. Conclusion: regulatory risk with FDA is considered nil by pharmas.
Concordia’s results basically mitigate clinical risk assessment for 4601. Sarabasil works well and 4601 should see similar or superior results.
Time frame.
Regardless of possible scenarios, all will end in Q3 2009, imo.
Strategic Review cannot last forever and must close near GBM trial.
GBM trial results are due in Q3 2009.