12
BioTech Sage Report, January 2000
The pharmaceutical stocks took a
hit this month and BSR interprets this
slide as a concern over product pipe-
lines and Medicare reform. Several
issues ago, we projected that a reac-
tion to Medicare reform would occur
and we anticipate Medicare reform to
continue to cause investor jitters
throughout the election year. As we
mentioned before, we view that there
is a low success rate for reform due to
low historical initiatives to control
drug prices as a part of health care
reform and the low probability that
any reform could be implemented
within the next three years. On the
flip side, the past few weeks has seen
resurgence in the interest of biotech
companies.
Alexion (BSR 31: Transplanta-
tion) reports first quarter results of a
loss of 46
˘
per share.
On December 21
st
, Procter &
Gamble Co. and Alexion's new heart
drug intended to reduce complications
from coronary-artery-bypass surgery
showed promise in early trials, and
the drugmakers have started new
rounds of testing. The drug, known
currently as 5G1.1-SC, reduced subtle
impairments common to bypass pa-
tients, such as memory lapses and dif-
ficulty concentrating, by as much as
80 percent and was also associated
with less heart-muscle damage and
blood loss after surgery. The drug-
makers are beginning three 1,000-
patient-each trials to continue studies
of the drug.
On December 7
th
, Amgen's (BSR
#6: Rheumatoid Arthritis) CEO
Gordon Binder plans to retire on May
11, 2000, following Amgen's annual
stockholder meeting, and would step
down as chairman of the board and a
director by Dec. 31, 2000. Amgen's
chief operating officer and president,
Kevin Sharer, will take over both po-
sitions.
Chiron (BSR #1/#14: AIDS/
Sepsis) said on December 21
st
, that
Gilead has agreed to pay an undis-
closed amount to settle a suit over its
infringement of three Chiron hepatitis
C virus protease patents. Gilead also
admitted infringing the patents. As a
result, Gilead assigned Chiron a co-
ownership interest to all of Gilead's
hepatitis C virus (HCV) protease in-
hibitor research results. Gilead also
agreed to cease screening for HCV
protease inhibitors and provide Chi-
ron some support in Chiron's HCV
protease inhibitor research.
On December 2
nd
, Chiron an-
nounced that its partner G.D. Searle
& Co. have initiated plans for a piv-
otal Phase III trial for their tifacogin
compound (tissue factor pathway in-
hibitor, or TFPI). The two companies
based their decision on data from the
recently completed Phase II safety and
dose-ranging trial of tifacogin in pa-
tients with severe sepsis and detailed
discussions with the FDA. There is
currently no approved therapeutic for
this life-threatening condition and
approximately 30 to 50 percent of
those who develop severe sepsis die.
Tifacogin, a recombinant form of
TFPI, is believed to block a critical
event in sepsis, namely tissue-factor
mediated clotting in small blood ves-
sels, which potentially leads to organ
failure and death.
On December 15
th
, Cygnus
(BSR#16: Diabetes) finalized the sale
of its drug delivery business to Ortho-
McNeil Pharmaceutical, Inc that was
announced on November 17th. Ortho-
McNeil will pay up to $75 million in
cash.
On December 6
th
, Cygnus an-
nounced that its premarket approval
application (PMA) for the Glu-
coWatch monitor received an unani-
mous recommendation for approval
with conditions by the FDA's Clinical
Chemistry and Clinical Toxicology
Devices Panel of the Medical Devices
Advisory Committee. The Advisory
Committee suggested three conditions
for approval, first is an education pro-
gram, the second is labeling and the
third is a post-market study of detec-
tion of hypoglycemia and hyperglyce-
mia.
The GlucoWatch monitor provides
frequent, automatic and non-invasive
glucose measurements and is intended
for detecting trends and tracking pat-
terns in glucose levels in adults, 18
years and older, who have diabetes.
The device is intended for use by pa-
tients at home and in health care Fa-
cilities.
On December 23
rd
, GelTex (BSR
#8: Cardiovascular) and Sankyo
Pharma Inc. announced the signing of
the final agreements on the licensing
of Cholestagel for the treatment high
blood cholesterol levels, and the op-
tion agreement for GT102-279,
GelTex's second generation choles-
terol-lowering product. The signing
will generate $12 million in upfront
and option payments to GelTex.
Genentech (BSR #4: Breast Can-
cer) and Alkermes announced on De-
cember 23rd that Nutropin Depot, the
first long-acting dosage form of re-
combinant growth hormone received
approval from the FDA for pediatric
growth hormone deficiency.
Genentech and Inspire Pharmaceu-
ticals, Inc. announced on December
21st the signing of a collaboration to
develop treatments for respiratory dis-
orders medical needs including cystic
fibrosis and chronic bronchitis.
Based on promising Phase II trial
results for anti-CD11a (hu1124),
Genentech and XOMA Ltd. an-
This section is to update and inform the happenings of those stocks that were previously featured in past issues.
BioTech Stock Updates
