Looking like a poor trial decision at interim (12% vs 5% )Hard to know why they deviated off their pathway at the interim data mark, but all indications are that it was a MISTAKE ( likely due to excessive blinding ). The adjustment suggested by the DSMB/FDA was for 650 ( later told 605 ) and this number guides us to a trial that was peforming at 12%. Please review the note below from Nov.6 2104. The analyst here was BANG ON with both comments. Yesterday's Mackie selling performance was a little telling and quite sesonal in nature.
EUPHRATES optimally; this is a difficult and complicated group of patients to treat, and trial after trial has failed. Based upon conversations with some of the most influential physicians on the topic, we believe that the MODS modification is insightful and selects the patients who are most likely to benefit. Therefore, our confidence that EUPHRATES will report positive data is increased. Our questions are: 1) will it be too late to help these patients (i.e. has endotoxin already done its damage), and 2) will the patients die of something else? We will not know the answers to these until EUPHRATES reports, but in the meantime we believe that Spectral is on track to report a successful trial. Recall, the interim analysis showed that the trial was on track to be successful at 605 patients, suggesting an 11% or 12% absolute benefit (10% at 720 patients, 15% at 360, so the benefit within the less sick patients would be within that range and closer to the lower end). We believe that the benefit within the sicker patients will be larger than what PMX provided to the patients who were previously enrolled, so in our opinion EUPHRATES has a good shot at success. We maintain our Buy (S) rating and $1.70 target price.