2/20/2019

918 days left

Biopharma/Investing

Lots of interesting things happening!
ICPT might be more commercially viable than the DOA pronouncement given. We’ll see! Will not be simple, for sure. But I wouldn’t figure in zero revenue, either.

When I spoke on the RDEB complex of KRYS ABEO and FCSC, I wanted to make a few things clear. 1) I have NEVER recommended any of these stocks and do not know them well at all. After two hours of research my (very) preliminary conclusion is buying the entire complex will probably achieve a positive return. FCSC is a strange company with a very bad capital structure and a partner I don’t trust (XON). If they dump XON it would be a more valuable company. KRYS only has reported two patients. ABEO is also a company in flux with tons of projects. It is very hard to tell which company will do well, FCSC may not even survive, after all. I don’t have any positions but I’m watching eagerly as this is really rough disease and the global opportunity is in the billions (value, if not revenue).

ACET filed and shocked with a sale of the chemical business for quite the price.

Papers I’ve Read

Trastuzumab Emtansine for Residual Invasive HER2-Positive Breast Cancer. von Minckwitz et al. NEJM 2019.
Roche hits it out of the park with Kadcyla in this trial. It’s still a bit unclear if you’d rather take Perjeta, Kadcyla or neratinib at this point, but it almost all benefits Roche’s attempt to transition away from Herceptin in any event. HR=0.50 for invasive disease or death is a bit shocking in such (relatively) well-controlled patients.

Residual Disease after Neoadjuvant Therapy – Developing Drugs for High-Risk Early Breast Cancer. Prowell, Beaver & Pazdur. NEJM 2019.
This whiny editorial bemoans the lack of a pathway to shortcut large phase 3s in relatively indolent early-stage cancers. One cannot have it both ways. A robust surrogate requires robust validation, in which case, you’ve so substantially improved the disease from hard outcomes, one cannot possibly be upset about requiring such large trials. At that point, you’re treating a different illness, akin to primary prevention vs. secondary prevention in CVD. If you don’t have a robust surrogate endpoint, then why risk the accelerated approval for a disease that is admittedly indolent and within striking distance for a surrogate?
In HRPC, PSA might become a viable endpoint due to the same circumstances. I just view this narrative as solutionless and fruitless. Pazdur’s suggestion of enriching for sick patients also misses the point that trials should reflect intended population and you’d be making serious errors in generalizing to broad populations if you did as suggested.

Personal

When I don’t post for some time, it is because I am very busy. What have I been doing? Mostly reading back issues of PLoS One, Nature Communications, Hum Mol Genet and other favorites. If you don’t hear from me, you should actually be HAPPY, as I am occupied and entertained. Daily posts would be a bad sign!

Good luck to Bernie Sanders, my old buddy! YOU CAN STILL WIN!

2/18/2019

921-922 days left – 30 months remaining

Biopharma/Investing

The next deep dive will be on REGN.

Here are 10 biotech surprises for the next few years. They are in no particular order.

  1. Microbiome comes up empty.
    There’s not enough here to create true clinical applications. Some of the findings are real but so often the solutions will be cheap antibiotics, leaving VCs (generally bad investors) holding the bag.
  2. Biosimilars never get scale and stink as a business.
    Despite Sandoz having $1 billion in biologics revenue, few companies purveying biosimilars have hit even 1/10th of this milestone. The key problem is without mandatory switching/substitutability, only new patients will get biosimilars. With brand discounting and cautious physicians not wanting to mess with what works (physician rule #1), taking some share of just new patients when almost all of these drugs are life-long chronic therapy is not exciting. Furthermore, by the time a drug becomes biosimilar eligible, there are generally creeping alternatives (exception: Neulasta).
  3. Immunooncology has no second act.
    With PD-1 being the first act (we’ll talk about CARTs in a moment), I don’t think any new “IO” drugs will be meaningfully efficacious. The situation will be akin to 2006-2008’s hunt for angiogenesis inhibitors after Avastin’s success. Turns out you can only deplete blood vessel growth so much. I think it will turn out that you can only prime the immune system so much before bad things happen. I think oncology will be a great area to invest with respect to mutational drivers, tumor microenvironment, metastases drivers, ADCs, and other modalities. IO is finished. RIP GITR, IL-2, TIGIT, OX40, IDO, etc.
  4. CART not useful, off-the-shelf therapies dominate.
    I only wanted to include shocking predictions in this list. With the 4th quarter of Kymriah sales coming in at $28 million, is this really shocking? There just isn’t enough juice in CART that makes it worth the squeeze.
  5. Don’t call major primary care categories being good business opportunities a comeback.
    The trend towards rare/expensive drugs has left major illnesses like osteoarthritis, obesity, pain, cardiovascular in general, etc. without much drug development love. I think the success of CGRP and potentially some new obesity and pain agents will remind folks that selling cheap drugs to millions of people is 1) a decent business plan and 2) avoids the high-price socialism we’re seeing on the fringes of the radical left.
  6. There will not be a new Alzheimer’s drug approved by the FDA for at least 10 more years.
    There is some emerging hope, however. Unfortunately I won’t say anything more on the subject.
  7. CAG/polyQ repeat disorders will not be treatable by the antisense modality.
    The one prediction I might be most wrong on, I believe we don’t have huntingtin, frataxin and other proteins just for them to cause lethal expansions. No, they are functional proteins after development and getting rid of the amyloid aggregates will not solve the problem.
  8. Despite the above nucleic acid therapeutics of all kinds will propser far more than anticipated.
    I think in the excitement of CRISPR and gene therapy, NA-based therapies may be overlooked as only a few companies have the know-how to deploy the chemistry required to be useful medicinally. As that technology passes into the public domain, more companies should employ these techniques.
  9. Orphan pricing will continue to grow unabated – $5 and $10 million per-patient-per-year therapies will be introduced.
    In a Moore’s law-type dynamic, PPPY has increased not because of some malefactors (and their epigones), but because society craves health more than any other good. Health spending since the 60s is on a power law that cannot be stopped by any legislation or NGO. It is not a bad thing.
  10. Artificial intelligence/molecular dynamics software will not improve drug discovery.
    These technologies have existed for decades and the advent of supercomputer clusters passing the baton to cloud computing does not significantly alter the status quo to generate any kind of revolution.

Papers I’ve Read

Universal Medicine Access through Lump-Sum Renumeration — Australia’s Approach to Hepatitis C. Moon & Erickson. NEJM 2019.
There’s a lot wrong with this paper. The authors predictably begin by crying: “high prices can restrict access to medicines in rich and poor countries alike”. Nevermind the determine of what is “high”–virtually any price is high, isn’t it? Australia’s “Netflix” model is put forth as a potential sword against drug pricing. Laughable. What doesn’t dawn on the authors, two (too-) inexperienced academics, is that Australia is 2-4% (being generous) of drug spend. Companies like Gilead don’t focus on Australia and couldn’t care less about maximizing revenue in this territory. The paper humorously ignores the net pricing of DAA in the US, instead assuming list price. We should all be so lucky to live in the world these authors do. It’s always sad to read editorials like this in well-meaning and ordinarily great journals like NEJM. Feelings. Reason. Who should win?

2/7/2019

931-932 days left

Biopharma/Investing
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Looked at the RDEB companies: FCSC, KRYS, ABEO. Looks like an investing opportunity, both long and short. Not 100% sure which stock is which 🙂

Lots of interesting Phase III data sets (including MGNX) to dive into.

Looks like one of SGMO’s assets didn’t work. I never really understood why they are targeting MPS: treatment options exist and there are plenty of other indications with zero medicines. I still like the hemophilia assets. Will try to do a deep dive here.

Briefly Reviewed – Empire State of Mind by Zach Greenburg
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Sean Carter (JAY-Z) has had quite the life. Arguably the most famous musician on the planet, he has become a very wealthy man despite what most would agree was a tumultuous start to his life. This first book about the famous rapper does very little justice to explaining a remarkably complex person. While the author can be commended for digging around and chatting with figures such as DJ Clark Kent, massive gaps limit the scope of this work to a pseudo-hagiography. The writer is clearly a Jay-Z fan, limiting his interest in sternly critiquing his subject. It’s hard to land too many gloves on Jay, but various opportunities known to many (and few alike), are missed.
Similarly, very little serious work is done on the artist’s art. Jay-Z’s music has undergone a stunning transformation–from a rapid-fire non-sensical and equally braggadocious and insecure to a triple entendres befitting a literary scholar. I don’t buy that we’re listening to Jay-Z, Sean Carter anymore. The other explanation is possible: Carter has become a hardened writing student. This mystery and many others (what is he marking Tidal at?) are left untouched and replaced with the gloss of easier questions and victory laps.

Papers I’ve Read
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Treatment Decisions for Babies with Trisomy 13 and 18. HEC Forum 2017. Isabella Pallotto and John Lantos.
My favorite part of pharmaceuticals is working on illnesses like these. This papers suggests that doctors give up on these patients too quickly, leading to a self-fulfilling prophecy of neonatal death. The ethical issues with giving these very sick patients expensive treatment is discussed. One overwhelming point is the disability paradox: these patients often have a QOL indistinguishable to healthy patients from THEIR perspective. Assigning your QOL to someone else is the wrong perspective, in my opinion.

Comprehensive molecular characterization of clinical responses to PD-1 inhibition in metastatic gastric cancer. Tae Kim et al. Nature Medicine.
No new insights here.

Personal
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My cat seems to be doing well as my father is now doting upon her, full-time.

Football season is over. Wasn’t too profitable. NBA is starting to look up. Our poor Knicks better get the 1st round draft pick!
Poker has been dull as well. Big “edges” are hard to get in any competitive area.

2/3/2019

935 days left

Amgen deep dive – Price target: $250 per share – 6% discount rate – 1% reinvestment/ROIC rate, -1% at maturity in 2030-2035 – no buy/sell recommendation
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Well, I’ve been following Amgen since I was a teenager. Their evolution into one of the largest biopharmaceutical companies is an instructive one. One general theme emerges: business and manufacturing excellence slightly outweighed a poor R&D and M&A record to record reasonable investor returns. The strategy going forward will be outlined here, and while intruiging, I only believe the stock is slightly undervalued (within the margin of error). With my sometimes too conservative estimates, however, one might be tempted to buy.

Enbrel — $5.0b in 2018, $4.5-4.1-3.7-3.3-1.5 billion estimates for ’19-’20-’21-’22-’30
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Acquired via Immunex in 2003 (if my memory serves), Enbrel has come a long way from the $750 million supply constraint challenges and partial American Home Products (AHP became Wyeth, which Pfizer acquired) ownership. Peaking recently, Enbrel had defied gravity along with Humira, but the TNFalpha era is ending. With drugs like Cosentyx, Stelara and many more superior autoimmune drugs, very few new starts will be seen for TNFs, especially Enbrel and Remicade (inferior dosing schedules). Writing a NRx of Enbrel for, say, psoriasis, is basically malpractice. Of course, the rule I’ve observed for a decade will apply: current patients who are happy will not switch. So, we will see a slow melt. Recall Amgen books US revenue, so there is no EU biosimilar impact. There is no US biosimilar, despite the Sandoz filing, and Amgen even considers Enbrel to be IP-protected. I disagree and expect within 5 years or so a true biosimilar will emerge. Still, the atrophy will be slow. Amgen wisely wholly owns devices such as SureClick which are advanced administration devices that might hold share (see OnPro). What is a bit more surprising is Amgen’s inability to develop any other autoimmune medicines to replace Enbrel. It appears they forgot about this field: while AbbVie and J&J were busy replacing their older franchises, Amgen stayed quiet and let JAK, IL-6 IL-12, IL-4 (they were early here, too!), IL-23, and more pass them by. All we have left that’s even close is tezepelumab with AZ. Poor R&D and BD&L/strategy management strikes again.

Neulasta — $4.5b in 2018, $4.0-2.8-2.0-1.8-0.9 billion are my estimates for ’19-20-21-22-30
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Not much to say on this very old product. Several biosimilars are in market with several more coming. “OnPro’, a particularly neat device, represents 60% of Neulasta right now. Again, a fairly bright S&M managerial move to extend this franchise. Payors may allow use of OnPro over a biosimilar and it gives Amgen managed markets a chance to pitch their story, which is one of the few ones that is believable. Even Mylan notes their market share relative to the long-acting market EXCLUDING this drug-device, which suggests this market is already bifurcated in some ways. Amgen has a long history of matching price against J&J in the EPO category, so expect them to battle “account for account” as they’ve said. Despite all this, I expect a big shrink in sales as OnPro only slows a complete implosion. I do think biosimilars get bigger and bigger share in the coming years.

Prolia — $2.3b in 2018, $2.5-2.7-2.9-3.1-3.2-1.6 are my estimates for ’19-20-21-22-23-30
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Denosumab is probably the most important asset to Amgen right now. After all, Enbrel and Neulasta are yesterday’s news. Prolia/Xgeva is not exactly a new drug, but I think there is more growth here. Amgen recently said they’ve penetrated 25% of the osteoporosis market. I think that’s a lot and actually is bearish relative to my prior expectations. This is a low-priced, mass-market product, which we will discuss as a theme momentarily. Most of these kinds of products don’t get to see 50-75% penetration that we see in other fields. There is a lot of inertia in medicine–even cancer patients resist treatment. So despite the impressive continued growth of Prolia, we will probably see a ceiling in a few years.

Far more important is IP. Now, Amgen is the IP king of biotech. Despite that, notice the 7718776 patent which expires in 2023 (at best 2028). OPG (now known as RANKL) is an old idea. Amgen played with these molecules for a very long time before denosumab came to light. I would not be surprised if biosimilar companies like Celltrion, Samsung and others start talking up denosumab as a pipeline opportunity in the next few years. Keep in mind there is no “Orange Book” for biologics. There is a “Purple Book” but it does not list patents.

Xgeva — $1.8b in 2018, $1.9-1.9-2.0-2.0-1.0 are my estimates for ’19-20-21-22-30
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The same IP situation applies to Xgeva as Prolia. Beware that this product will not last forever.
The Xgeva oncology indications should saturate more quickly than Prolia, and I believe they have, even though decent growth numbers continue. Better and better underlying drugs may prevent metastasis and you may even see the drug start to shrink in a few years.

Aranesp — $1.9b in 2018, $1.7-1.5-1.2-1.0-0.6 are my estimates for ’19-20-21-22-30
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Not much to say here as this product has become less important. Interestingly, given the lower sales, this is less of a target for large numbers of biosimilars. The same dynamic may apply to Epogen and Neulasta, which are very tiny, and inferior products, but will still be stickier than products with biosimilar risk. Vifor is the branded competition here.

Aimovig — $117m in 2018, $510m-850-1100-1265-1328-1869m are my estimates for ’19-20-21-22-23-30
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My numbers are conservative. The drug is off to a fast start. This is another low price-large number of patients market which strategically diversifies Amgen from the rest of the industry. Amgen is acting more like pharma and pharma is acting more like biotech. I think Amgen may be smart here, targeting markets they basically have to themselves: osteoporosis, migraine, obesity, cardiovascular. These are forsaken lands compared to cancer and they may just do well employing this strategy.
Aimovig clinical data sucks, the whole class is meekly efficacious. Amgen has at least two other migraine compounds, however. My numbers may be a tad conservative, still. If you are a big CGRP believer, this could be the next massive class with several $5 billion products. I don’t see it–maybe I can see it getting to $2 or $3 billion. Keep in mind Novartis gets something.

Repatha — $550m in 2018, $696m-974-1267-1520-1824-1915-2100 are my estimates for ’19-20-21-22-23-24-30
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Another low-price, large-market drug in a not-so-crowded area. I see Repata doing well, but new entrants are coming from ESPR and AMRN also makes things tricky. There are millions of addressable patients and my numbers might be VERY conservative, which is a little hard to believe for a $550 million drug forecast to become a $2.1 billion drug. I wouldn’t be shocked if Repatha could hit $5 billion or more in peak sales.

omecamtiv — Poor sales for Entresto keep me on the sidelines here. The RP deal was a bit insane.

Evenity — launching soon
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I only see $1 billion peak sales here. If you look at the data for Prolia, it is very rare to have a fracture on Prolia + bisposphonates. If you really need Evenity you are a rare treatment-resistant osteoporosis patient. It will be interesting to see how they price this drug as well. With a potential black box on cardiovascular, and Amgen not particularly enthused body language, I think $1 billion is fair for now. UCB gets a chunk here, too.

Krypolis — Only thing to note here is the relatively near-term LOE. The composition of matter goes in 2025. This is NOT a biologic. The Onyx deal is a wash–a lot of people don’t know they get a decent royalty on Pfizer’s mega-blockbuster palbociclib.

Biosimilars — $1b in 2025 and $1.8b in 2030
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My forecasts are conservative. Amgen has the best execution in biologics manufacturing and may just sell $5 or $10 billion in biosimilars with time. This is a brilliant strategic decision by them despite early softness in biosimilars. It’s also a very smart hedge for their business.

tezepelumab – 2030 estimate of $1.0b — AZ partnership
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Probably the most exciting drug in a meek pipeline. Risks are to the upside of my estimates.

Various R&D comments
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Amgen is still a poor research company. Look at the oncology targets: CD19, BCMA, DLL3, MCL1, PSMA, KRAS. Zero originality here. Decent execution with AMG510, which may be huge, shows some better performance on delivering drugs but creativity is what you need in R&D. Completely absence from PDL1 or CTLA4 is telling. I don’t trust BITEs and think the CD3 affinity doesn’t get you anything special. Look at how poorly Blincyto compares to Kymriah. I don’t see BCMA holding up over the long haul either.

With obesity targets like AMG598 and cardiovascular targets like AMG890, Amgen is being creative with the return-to-large markets hypothesis that other companies are abandoning. “Zig when they zag?” I like it.

Valuation
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I assume zero R&D cost after 2019 and no new drugs other than a small handful. I discount cash flows at 6% (similar method for CELG with a 6.5% discount there) and assume they reinvest accumulated cash for a return of 1%. I assume maturity in 2030 or 2035 and cash flow declines at 1% per annum then. SGA is 25% of revenue and COGS are around 12% of revenue. Cash flow and net income are the same here. All this yields the slight upside of $250 per share. Holding this framework constant across the industry (while changing discount rate, reinvestment risk and maturity to reflect portfolio risk, management intellect and industry conditions) has served me well.

Biopharma/Investing
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I was told Munger and Buffett refer to other “value” investors as “groupies” and joke about their poor performance. Buffett clones and Graham/Dodders are often poorly mimicking 50s-70s stock-picker Buffett without the same comforts: cash flow, no LPs, etc. That may have worked for a few years, or in an up-only market, but this strategy was never meant for public hedge funds.

Papers I’ve Read
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Marine n-3 Fatty Acids and Prevention of Cardiovascular Disease and Cancer. Manson et al. NEJM 2018.
Vitamin D Supplements and Prevention of Cancer and Cardiovascular Disease. Manson et al. NEJM 2018.
Well, cancel all your vitamins, they don’t do anything. p=0.24 and p=0.47 should clear your medicine cabinet of at least two worthless drugs. The only question is do these “supplements” (code word for “non-useful medicine”) help a certain cohort of patients as opposed to all-comers. Subsets are hypothesis-generating, at best, and I don’t see a clear trend other than omega-3s helping patients at serious pre-existing CV risk (already well-known).

Book Review – The Cartel by “Ashley” and “Jaquavis”
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This “hood book” is touted as the epitome of the genre. “Urban” fiction is usually written in a mix of street slang and proper (mostly) English, and typically draws on life in the milieu of poverty, drugs and crime. The Cartel is a bit different, taking us inside the fictitious Diamond family, who dominates the Miami drug trade. While not quite as suspenseful as Patterson, The Cartel features fairly intimate character portrayals that clearly connect with the reader. The fanciful plot is a bit far-fetched at times, but this is fairly typical in the genre. Still, I enjoy my ‘hood books’ when they’re as gritty and reflect the downtrodden grime that comes with the reality of the streets. The Cartel glamorizes drug trafficking, to an extent, suggesting that there is a path to wealth and legal success. While truth can be stranger than fiction (look for my next review), the inane focus on branding and the appearance of wealth drowns an otherwise reasonable plot. If you’re looking for your first ‘hood book’, try Good2Go Publishing. For the curious, it is all some of us practically read in here. If you’re still confused, think the book version of the film “Belly”.

 

1/26/2019

Biopharma/Investing
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I don’t think Evenity will sell well. Aimovig might be a monster, though. More on Amgen very soon.

The web media layoffs remind us that there is no money in virtue signaling. Major media will get back to real news. The ‘fakeout’ caused by companies like Vice and Buzzfeed will retract and the CBS/ABC/NBCs of the world will realize ‘woke’ culture and uber-progressivism won’t pay the bills. People want the news, not preaching. Companies like Buzzfeed (hungry for a merger) are still upside down on cost structure and will go bankrupt. Startups, such as Gawker’s latest iteration, actually have a risk of imploding on their own smug, before they prove they’re not viable businesses, either. More 20-somethings will realize that their calling of ‘speaking truth to power’ (by trying to usurp power itself) is a distant second to operating profit. No operating profit, no whining about the benefits of socialism, sorry.

Clinical Trials I Noticed
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Drug Interaction Study Between Dorzagliatin and Empagliflozin. Hua Medicine Limited.
Drug Interaction Study Between Dorzagliatin and Sitagliptin. Hua Medicine Limited.
Hua is 2552 HK. It’s a true Chinese biotech with nothing but this glucokinase activator. But are you trading it? No, because it’s easy to go long some consensus stock and underperform.

Exploratory Study to Investigate the Bioactivity, Ocular and Systemic Safety, Tolerability and Pharmacokinetics Following Single and Multiple Intravitreal Administrations of KSI-301 in Subjects w/AMD, DME, and RVO. Kodiak Sciences.
KOD is a freshly public company worth around $300 million. A putative fourth entrant into the ocular VEGF space would be welcome, I think. This one is kind of interesting and worth watching IMO. No relation to Codiak, one of the more valuable private companies.

RUCONEST as a Therapeutic Strategy to Reduce the Incidence of Delayed Graft Function. Pharming Technologies.
Remember PHARM NA? Seems cheap, only around 4-5x sales and they seem to be focused on expanding Ruconest outside of HAE as soon as they can. Changes abound in the HAE space but there is usually therapeutic inertia, so they just might be okay. Worth watching this European stock.

ANAVEX2-73 for Treatment of Early Alzheimer’s Disease. Anavex Life Sciences Corp.
Remember these guys? AVXL, I think. They ran a SINGLE-ARM phase 2 and tried to make some efficacy claims. No joke. Better luck with a placebo-controlled study.

BrUOG 379 Phase Ib/II Trial ONC201 + Nivolumab in MSS mCRC. Oncoceutics. Brown University.
This tiny private company is developing this “ERK/AKT” inhibitor. I haven’t looked into it enough to tell if it actually binds ERK or AKT or simply reduces their activity (major difference!). Worth looking further.

Papers I’ve Read
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Antitumor properties of RAF709, a highly selective and potent inhibitor of RAF kinase dimers, in tumors driven by mutant RAS or BRAF. Shao et al. Cancer Res 2018.
0.3-1.5nM doesn’t get Novartis out of the woods here, unfortunately, as other new RAF “dimer-inhibitors” like LY3009120 and lifiratenib show weak clinical data. The RAF monomer-inhibitor craze got started with Roche-Plexxikon (Plexxikon acquired by Daiichi in 2011 for $800 million) and Taflinar. All of these drugs have been underwhelming. The subtext is the main goal is to inhibit the “undruggable” RAS via RAF inhibition attenuating the downstream signal. With AMG510, a true RAS inhibitor with clinical activity has been advanced. Anyway, a slew of new drugs inhibiting both dimer and monomer formations of RAF were discovered. Here, the phase 1 demonstrated 2 PRs out of 75, all but ending the short life of what is now known as LXH254.

Personal
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I’ll root for the Patriots. Just for Patty!

1/25/2019

Biopharma/Investing
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Lots of interesting personnel changes: EDIT, VRTX.
Gossamer going public is fascinating.

Papers I’ve Read
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The Structural Violence of Hyperincarceration – A 44-Year-Old Man with Back Pain. Karandinos & Bourgois. NEJM 2019.
Funny last name of the second author. The paper walks through the odyssey of one inner-city Spanish-speaker. The article notes 70 million US citizens have a criminal record (we can do better! why not 270 million!?), but wrongly places blame on incarceration as a cause of “structural violence”, an imaginary construct.
I am actually in prison, right now. Prison doesn’t create “structural violence”. The BOP has an efficient system of allocating violent people–you get classified to the appropriate security-level according to your actions. Healthcare has been fairly good, even relative to the care I receive “on the outside” with my millionaire lifestyle. The issue with this man’s distrust of the healthcare system is his lack of education and inability to speak English. He’s 44, likes to deal drugs and break rules. He distrusts doctors because he has a poor grasp on reality in general, not because he has “institutional distrust”. He doesn’t understand the world around him. He doesn’t want to.

The Imperative for Climate Action to Protect Health. Haines, Ebi. NEJM 2019;380:263-73.
Here we go. Surface temperature has increased by 0.7 degrees (Celsius) since the 1961-1990 mean. In 1850 it was negative 0.4 degrees. This is an abysmally poor data set to draw conclusions–without at least 50 periods similar in length one cannot even calculate the effect size of this change without information on temperature’s volatility (standard deviation). This lowly review articles relies on other similarly flawed data sets and their interpretations. Temperatures are probably increasing but give me a solid study that proves that. What inferences can we really draw? Do we assume humans stand there and do nothing, or react accordingly? Protecting health from possible climate change impacts is very important, and sounding alarms of danger is important too. But let’s not put weak meteorological data in the best medical journal.

Personal
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Anyone else having a bout of seasonal affective disorder? Yeesh, January has always been rough for me. At least spring is almost here!
There was an article in WIRED (thank you) about Elon Musk which is a must-read. In my first major CEO job, I was a lot like Musk. Impatient, full of expletives and outbursts, basically unprofessional. I’m really happy that I grew out of that behavior. If you are yelling at your colleagues, you’re not only alienating your important partners but also you should simply be reflecting on your own inability to properly allocate human resources. That person in chemistry is an idiot? You hired them! Or, you hired the person who hired them. Your fault, buddy. Save your breath.

Becoming a “celebrity” overnight also happened to Musk and you can see what it did to him. Thankfully a lot of my celebrity came after being arrested and I resigned, but the overlap period was still harmful. I understand, to some extent, what Musk is going through. It’s probably best for him to stay CEO, for the sake of the employees, but turn off his outside life. There comes a pressure of feeding ‘fans’ that starts to distract–and I felt that despite modest fame. He also has SpaceX and other interests to manage. If the company has another good quarter, all the naysayers will be proven wrong, but in the meantime for his own health he should focus 100% on the businesses and turn off the media and any celebrity-type activities.

1/22/2019

947-951 days to go

Biopharma/Investing
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JNJ’s results are interesting. Their portfolio has never been this volatile. Remicade is plummeting, run-rating at just under $5 billion now, with Stelara and Tremfya still growing. This doesn’t bode well for AMGN–they have no next-generation autoimmune drugs (not even a stinking JAK inhibitor). Still no Zytiga generic–something will probably launch this quarter.

Read an article about an amyloid-beta vaccine. I actually met the husband-wife team around 10 years ago. Very nice couple, did not think the drug would work then, do not think it works now. There is a lot going on in the AD world right now that I perhaps will write up shortly.

Papers I’ve Read
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In Vitro Pharmacological Characterization of Buprenorphine, Samidorphan, and Combinations Being Developed as an Adjunctive Treatment for Major Depressive Disorder. Bidlack et al. JPET 2018.
As we prepare for the FDA rejection of ALKS5461, this article came across my ‘desk’. The article begins by suggesting there is evidence of an effect of buprenorphine in depression. I disagree. As my jail colleagues point out, the three citations supporting this claim are unfounded. First, Bodkin in 1995 trialed only 10 patients with buprenorphine in an acute setting–far too few to draw reliable conclusions, especially without a control. In a review article, Kosten pointed to two studies, principally the horrific Alkermes phase 2 which suggested 2mg/2mg of ALKS5461 “worked” (-2.8 vs placebo on HAM-D) and 8mg/8mg failed (-0.5 vs placebo HAM-D). Of course it is fun to throw away data that doesn’t support your claim and rely on this evanescent and unpredictable (and untenable) dose window where ALKS5461 has a treatment effect but at only 4x the dose, it disappears. The rational thing to do is group the data–doing so would result in failure, of course. The phase 3s were no better. Kosten also calls out the Yovell, et al. trial of ultra-low-dose buprenorphine with a p=0.04 result and unclear (to me, at least) statistical treatment of dropouts. The Ehrich, et al. phase 1/2 tested a 4mg–>8mg dose which provided the ironic impetus to go to phase 2, where that dose had no effect.
Moving forward, we have an addictive opioid and a proprietary antagonist/partial agonist (samidorphan). The theory is samidorphin will somehow limit the abuse liability of buprenorphine while sparing the alleged anti-depressant effect. How or why this is possible is not really discussed nor accessible to the imagination. The actual experimental results here are not interesting–buprenorphine is a partial agonist at the triad of opioid receptors. The workers found a difference between the high-affinity state/low-affinity state binding of our favorite ligand, with unclear implications. There were no obvious conclusions to be drawn from the fairly advanced BRET assay used to interrogate specific G-protein coupling (Galphai/o). One is left wondering if there is a therapeutic effect here at all (and there is not), then why not just use opioids? In fact, one paper suggests before the 1950s, opioids were the mainstay treatment for “melancholia”. And why do we need a new opioid partial agonist/antagonist in samidorphin? Isn’t naloxone or naltrexone enough? Right, patents. Samidorphin is a “new chemical entity” and would protect the “invention” here. But what is the attenuation of samidorphin really worth, even assuming a therapeutic effect? Couldn’t you achieve the same outcome with a lower dose of buprenorphine or an even weaker opioid agonist? This is pharmacology done wrong. Thankfully ALKS5461 is headed to the wastebasket of drug ideas.

Personal
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Great NFL weekend! Algorithms found the games too close to call, and I guess they were! I hope the Patriots lose.

I really want to learn Spanish. I just have no time… it’s funny how quickly “this bid” is going. I’m going to miss it!

1/16/2019

953-956 days to go – 31 months

Biopharma/Investing
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Not surprised APTX doesn’t work. The depression stuff doesn’t work either.

Papers I’ve Read
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Discovery and characterization of AZD6738, a potent inhibitor of ataxia telangiectasia mutated and rad3 related (ATR) kinase with application as an anti-cancer agent. Foote et al. J Med Chem 2018.
AstraZeneca’s ATR project has yielded a clinical candidate. 6738 is a suloximine (S=N), replacing the sulfonamide moiety of the hit AZ20. Apparently, this SNOH- moiety hanging off the cyclopropyl did the trick to improve solubility and eliminate CYP3A4 liability (that and one atom on the heterocycle). Anyway, ATR is part of DNA damage repair. You’ve probably heard of it from Vertex, who sold their VX-970 to Merck KgaA (now M-6620 or berzosertib) for a pretty penny. I don’t trust anything from Vertex Cambridge drug discovery (including and especially Derek Lowe). So far I don’t think anyone is bowled over by the data for ATRs–no monotherapy efficacy. There’s a Bayer compound out there, too. It seems like the AZ predecessor compound was around for a while.

6-Benzhydryl-4-amino-quinolin-2-ones as Potent Cannabinoid Type 1 (CB1) Receptor Inverse Agonists and Chemical Modifications for Peripheral Selectivity. Zhang et al. J Med Chem 2018.
J&J researchers produce a peripherally-restricted CB1 agonist to avoid the AE profile of the storied Accomplia. I didn’t know GC1 was the MOST abundant GPCR in the brain–kind of amazing, huh?

Cytokine-Induced Expression of HIV-1 in a Chronically Infected Promonocyte Cell Line. Folks, Fauci, et al. Science 1987.
Human Immunodeficiency Virus-Infected Individuals Contain Provirus in Small Numbers of Perpiheral Mononuclear Cells and at Low Copy Numbers. Simmonds, et al. J Virol 1990.

Still in the way-back-machine for HIV.

Personal
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Lauren Duca divorced her husband and is gay now. Just 2 and a half years ago she thought it was wise to marry a man. Now all she tweets about is how terrible and useless men are. Play to your audience, I guess. Perhaps she will even become an author, selling her book to a like-minded left-wing gnat (or nut?) at a publishing company that doesn’t realize they’ve been appropriated by ideology. Maybe I should rollup that industry and instill some libertarianism. People should be able to read whatever is appealing, not what some self-anointed anti-business SJW gatekeeper decides.

I wrote more on this and recent revelations that Duca is a body-shamer (the body-shaming posts are awful) and even an ablist/classist as she panned community colleges in a recent Facebook post if you’d like to read it. Evidently even further revelations are forthcoming. Guess her book deal may be off-the-table.

1/12/2018

957 days left

Biopharma/Investing
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Biomarin’s CEO said there is no drug pricing crisis or problem and this issue is “all politics”. He is 100% correct. If you analyze disposable income, funds spent on pharmaceuticals vs. entertainment, poverty rates, insurance coverage rates and other data sets, you cannot possibly reach any other conclusion. As I said in my Ivy League tour, think with facts and reasoning, not with emotion, and you’ll discover the truth–assuming it is the truth you were seeking in the first place.

Papers I’ve Read
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Vpu Mediates Depletion of Interferon Regulatory Factor 3 during HIV Infection by a Lysosome-Dependent Mechanism. Doehle et al. J Vir 2012:86;8367-8374.
6 years ago, Vpu was discovered to label a core host viral defense mechanism, IRF3, “garbage”, prompting the obsequious cell to digest its comrade in the greedy lyosome. The conniving interloper wins.

Hydroxyurea for Children with Sickle Cell Anemia in Sub-Saharan Africa. Tshilolo et al. NEJM 2019:380;2
Why? A single-arm study of a well-known drug. Just why?

Next-Generation Sequencing to Diagnose Suspected Genetic Disorders. Adams, Eng. NEJM 2018;379:14
Simple backgrounder for anyone who has been asleep.

Personal
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Keep the government shut down until our debt is retired. It will balance the budget. Just 10 years? Keep collecting taxes. In 2035, no taxes, no government. Perfect answer, and it worked in the 1800s 🙂

1/11/2019

958 days left

Biopharma/Investing
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Carl Icahn (or any other large swashbuckling investor) should take a stake in BMY, scuttle the CELG deal, which is suboptimal at best and wasteful at worst, and sell the company to PFE instead. Buying 100-200 million shares at $45 and cancelling the deal makes you $1-2 billion alone. Then, if PFE, Novartis or JNJ, who no doubt would want Opdivo, would be interested in a $100 billion or higher offer for BMY, one could net $2 to $4 billion on the trade.

What can be said about Bezos that hasn’t been already said?
Vinik coming back to hedge funds is interesting news.

Papers I’ve Read
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A Conserved Role for Serotonergic Neurotransmission in Mediating Social Behavior in Octopus. Eric Edsinger, Gul Dolen. Curr Biol 2018.
Nature advertised Octopi on Ecstasy, so I had to look this paper up. It’s about as weird as expected, with some fairly high p-values. Octopi (and virtually all other species) express SERT and the MDMA-binding site on SERT is fairly homologous to human SERT, although homology on a small part of a huge transmembrane protein shouldn’t get one too excited. Anyway, they use a “three chamber” study design often used with rodents and find MDMA has a very weak effect size, driving male octopi to females as opposed to their unaffected state where they prefer examining a unique object. What does this tell us about behavior? Who knows, I’m just a drug guy.

Theoretical Prediction of the Creation and Observation of a Ghost Trilobite Chemical Bond. Eiles, Tong & Greene. Phys Rev Lett 2018.
Rydberg atoms can form bizarre “trilobite” bonds. The electron probability functions look like actual trilobites from eons ago. These Purdue physicists demonstrate a “ghost bond”, where such a Rydberg electron exists in a strange (>100nm bond length!) state WITHOUT the other atom present. Ghost bonds. Truth stranger than fiction…

In vivo fate of HIV-1-infected T cells: Quantitative analysis of the transition to stable latency. Chun, et al. Nature Medicine 1995.
A seminal paper, 23 years old, on identifying the latent ‘reservoir’ of CD4+ proviral T cells.

Personal
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In a few days (the 13th) my monthly jailiversary will be here. Celebrating 16 months in and 31 to go.