press releases index

it's heartening to see news coming.

Commencing vap trial and presenting at conferences is all positive.

We really need to see the press release announcing the rest of world deal for LANI. Based on the anaconda deal numbers it should be worth much more than I have previously proposed. And I hope the anaconda deal was done with the understanding that the LANI deal would soon increase cash reserves.

So with RSV compound at Phase 1, Vapendavir in Phase 2 b, Anaconda's drug coming to Phase 2b, and LANI potentially at Phase 3: well, that's reasonable biotech-bait.

Here's what BOTA bought for 16 million up front

as described in the abstracts of the 2013 Eurogin conference (see below comments).

It's good to see some movement, but the questions are all pretty obvious:

* the phase 2a was in 24 subjects of which  16 received the drug. While the statistical power wasn't formally sought, the differences with control were better but weren't huge. A lot of money for a compound tested in16 patients; and

* HPV subtypes 6 & 11 will gradually but definitely reduce in incidence and prevalence due to Gardasil and Cervarix vaccines, especially if countries vaccinate their boys as well as girls.

The market hasn't responded well so far. Cash is the Biota SP's best friend, and they just snubbed him.

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SS 15-5
SAFETY, PHARMACOKINETICS AND EFFICACY PHASE II-A STUDY OF AP611074, A HPV-SPECIFIC TREATMENT
FOR ANOGENITAL WARTS:

Fouéré S1, Marchitelli C2, Tatti S3, Galimberti R2, Halioua B4, Dupin N5, Françon P6, Compère D6, Yaniv M7, Thierry F7,8,
Botchan M9, Blumenfeld M6 & Chosidow O10.
1STD Clinic, Hôp. St Louis, Paris, France; 2 Depts of Gynecology and Dermatology, Hospital Italiano, Buenos Aires, Argentina; 3 IADT, Buenos Aires, Argentina; 4STD
Clinic, Institut Alfred Fournier, Paris, France; 5Dept of Dermatology, Hôp. Cochin, Paris, France; 6Anaconda Pharma, Villejuif, France; 7Institut Pasteur, Paris, France;
8IMBaStar, Singapore; 9Dept Biochemistry and Mol Biol, UC Berkeley, USA ; 10Dept Dermatology, AP-HP, Hop. Henri Mondor, and UPEC, all in Créteil, France

Objectives: AP611074 is a new chemical drug that selectively inhibits the interaction of E1 and E2 proteins of HPV 6 and 11, and thus blocks HPV DNA replication. In
this study, we aimed to obtain proof-of-concept study of AP611074 in the topical treatment of anogenital warts (condyloma) related to HPV 6 or 11 infection.
Methods: We performed a phase IIa double-blind randomized clinical trial study to assess the safety, tolerability, efficacy and pharmacokinetics of twice daily repeated
applications of AP611074 5% gel during 42 days on the anogenital lesions of condyloma patients. Twenty-four patients (both males and females) were included and randomized
2:1 (AP611074 vs excipient). The study was multicentric and conducted between February 2012 and July 2013 in four clinical centers located in Paris, France
and Buenos Aires, Argentina. Main inclusion criteria were: male or female patient aged between 18 and 55 years ; BMI between 18 and 30 kg/m2 ; external condylomas,
1-15 lesions, non-confluent and individually isolated ; total lesion surface smaller than 5 cmÇ, and individual lesion surface smaller than 1 cmÇ ; lesions should be
easily measured by the Investigator using a “French Catheter Scale”. Safety, PK and efficacy evaluated by Investigators every week until the end of sudy visit. After completing
the 42 days treatment, patients were observed 14 days post-treatment. Non responder subjects underwent a biopsy of 1-2 lesions at end of study (EOS) visit to
assess if remaining lesions contain HPV6 and/or HPV11. The efficacy objective was assessed after 6 weeks of treatment through primary efficacy end point of complete
clearance rate, secondary efficacy end points of partial clearance and overall response rate, and an additional exploratory analysis of the reduction of the total condyloma
baseline area.
Results: AP611074 topical treatment was shown to be safe with low systemic exposure and was well tolerated as shown by high patient compliance and lack of adverse
events.
Plasma concentrations of AP611074 were very low, steady state was rapidly achieved, no drug accumulation was observed over the 6 week-treatment and no drug was
quantifiable 2 weeks after stopping the treatment.
Efficacy end points showed complete clearance rates of 13% (CI95%: 4-36%), partial clearance of 44% (CI95%: 23-67%), and overall response of 56% (CI95%: 33-77%) in
the FAS population while in the PP population, these rates increased to 20% (CI 95%:6-51%), 50% (CI95%:24-76%) and 70% (CI95%:40-89%), respectively. As expected,
due to the very low power of the trial (<10%), no differences were observed in the primary and secondary efficacy end points in the intergroup comparison.
When the condyloma area was analyzed after 6 weeks of treatment, a 65% reduction of the baseline lesion area was observed in the AP611074-treated patients. This
reduction was statistically significant (p=0.020) when before/after treatment areas were compared intragroup.
Conclusions: AP611074 showed elevated rates of complete and partial clearance and overall response, as well as statistically significant reduction of the baseline lesion
area. The clinical effect that has been observed in this first trial of 6 weeks duration needs to be further investigated in larger adequately powered efficacy and safety
studies of longer duration.
AP611074 is the first drug candidate designed to block HPV replication to enter clinical development, and one of the first examples to show that Protein-Protein

and krensavage too

Krensavage a little late on reporting its buy..

That's another specialist bio fund, and one that likes to buy companies rather than drug prospects.

Read all about it

The new positions in Biota were published today (for transactions in the quarter ending 31 December).

Many funds had either significantly sold down or completely sold out of Biota in that quarter, explaining the large chunky sales.

BlackRock and JP Morgan were the heaviest sellers.

In their place 2 or 3 specialist biotech funds have emerged as holders: RA Capital, Senzar Asset Management and to a smaller extent a new fund Venbio.

Further, East Hill emerged from its hibernation and bought another 400,000 taking it to just under 10% of the company.

Baker Bros and a couple of others held their nerve. Broadfin is still there, but didn't buy more.

And why not I guess: the stock is at cash backing, so hopefully it has hit the bottom. Unlike some biotechs with no cash, where the bottom can be very deep and distant.

One small thing that emerges are the number of links to Vertex: Landon Clay, RA Capital, and a couple of other smaller links.

The BIO CEO presentation was interesting. Not so much for the presentation, but for the questions. Biota management get to field very few questions publicly. Joe Patti was forced to acknowledge a key issue in the company's strategy for vapendavir. If they keep ignoring it, it won't go away.

Vap might prove to be effective, in asthmatics with proven HRV infection. Let's say it is, for the sake of argument. 

The subset of proven HRV to clinically enrolled HRV might be as low as 40%. OK. When the drug goes to the FDA itself and its subcommittees, it's plausible, maybe even likely, that the FDA might say two things:

1. That any level of adverse effect is unacceptable (see plecoranil) given many people without HRV might take it and/or

2. That it's not reasonable to treat the 60% of people with clinical common cold symptoms who don't have HRV to get a response in the 40% who do. This is because HRV is self-limiting. SO, they might approve the drug in proven HRV exacerbations. Which would be fine, if there was a rapid HRV test. Which there isn't yet.

The BARDA contract is nearly disentangled. That became more of an issue than analysing or explaining why they stopped the trial. We have very little information on that.

Relenza and LANI will earn a little more than expected this FY which is great news because the only thing supporting the sp is cash, and the more BOTA burns cash the more the sp will drop.

Finally, no news on LANI. A 10-20 million dollar upfront and a few % royalty is probably all that can be hoped for, but there will be some element of credibility in inking a deal, and the cash will be useful as an addition to a takeover... sometime next year. 

I don't know what East Hill and Broadfin are asking management and the board to do. But settling BARDA, settling LANI, and packaging the cash and royalty streams with vapendavir and RSV might be somebody's idea of a reasonable purchase.

JP Morgan Conference Presentation

is posted on the BOTA website.

They seem to have streamlined their strategy and it's presentation. There is no further mention of BARDA and efforts to reclaim $. The (re) analysis of LANI outcomes is encouraging.

It's organised and plausible. They have a package with near term plans for RSV at Phase 1, vapendavir at Phase 2 and LANI still sitting at Phase 3.

However, they are giving themselves all of 2015 to partner ROW LANI.

Vapendavir Phase 2b and RSV Phase 1 won't have results till mid 2016, by which time their cash position will be a lot less than now. I really wish they would look at a rapid test for rhinovirus.

The only value adding step in the near term is partnering LANI. But a year is a long time and the share price doesn't have that luxury.

Volume: like smoke, there's gotta be fire

The volume of shares recently traded in Biota is unusually high. Also, the trading is lumpy. The share price has increased, at times hitting 2.80 before settling back again.

US trading is notoriously opaque, so the market is none the wiser. Whether its new entrants, or holders adding or selling we really don't know until the end of quarter reporting and that's 6 weeks delayed. Apparently the high frequency trading skills don't extend to high frequency reporting.

It looks to be a nasty northern hemisphere influenza season. And the CDC is (rightly in my view) recommending early antiviral treatment.

But seasonal sales of relenza always disappoint. There is no marketing, poor stocking, and so sales are minimal. Other than a surprise Japanese stockpiling order early in the year, I don't expect much from relenza sales the rest of the FY. So, that can't explain it.

Inavir sales for this winter won't be reported until full years results in May.

And we know the R&D calendar is set way back.

Any end of FY rebalancing shouldn't have continued into the first week of the new year, and it has.

And, a BARDA settlement would be just cash, which is great, but a one-off.

So, I can only speculate this level of activity is a balance between large holders wanting out, and someone else confident of, or planning, corporate activity. It's a level of turnover that's just too high to be normal. And, I'm a firm believer that unexplained share movements always have an (eventual) explanation.

2014 has been another disastrous year for Biota.

Over the last month or so, we've seen someone unwinding their major position/s on market. Significant lumpy tranches of shares have traded on a relatively frequent basis, with little else happening in between. Obviously, someone is on the other end of those trades. Hopefully, there is consolidation happening with an activist fund taking the running.

Going through the recent quarter results leaves a few questions.

1.      The Company spent $5 million in the quarter on VAP development. They indicated no result of this Phase 2b likely until mid 2016. Without a fixed budget estimate from the company,  it’s reasonable to assume therefore that VAP Phase 2b development will cost $25-30 million over the next 18 months.

2.      The company spent $2.4 million in general and administrative expenses, with a 100k increase recorded over last quarter. Looking forward, the annualised expenditure will be $9-10 million. The company previously announced that it would seek to closely align internal overhead costs with anticipated royalty revenues. It doesn’t seem possible. My most optimisitic estimate is BTA will earn  4 million pa, and that’s assuming the negative LANI trial results doesn’t have an impact in Japan.

3.      The cash burn approximates anywhere from 20-30 million per annum. A settlement with BARDA would modify that assumption.

4.      The company previously announced an aim of 20 internal employees. Why does a company with 20 employees need 7 directors?

5.      Biota sold its antibacterial program during the past quarter to TAXIS without an announcement. What were the terms for that divestment? Free to a good home? Cubist is being acquired for similar compounds.

6.      Further, regarding VAP, without a rapid rhinovirus diagnostic:

1.      Phase 3 trials will be long, and expensive; and

2.      FDA expert clinical subcommittees will not look favourably on it. If they limit registration to PCR proven rhinovirus in asthma, it will have limited value.

No partnering deal was made as a result of the first (apparently successful) VAP trial, implying there was no value in that compound with Big Pharma, or that Biota management were hubristic and held out for more than they would ever be offered.

If the company spends another 30 million on its development, that will bring total expenditure on the program to nearly 50 million.

Why is it better to spend 50 million than 20 million on a compound that has no expressed Pharma interest?

No-one has (ever) explained if there is actual Pharma interest in this (BOTA’s) VAP program and at what value that sits.

Given cash value is the only thing supporting the share price, it can only follow that if expenditures continue at the current rate, the share price will be 30-40% less than its current price in 12 months.

The Board hasn’t explained why the current plan will deliver outcomes. It is far riskier than LANI, which was also pursued without a partnership deal in place. We’ve seen the implications of that. If VAP isn’t partnered, and it fails, the company will be decimated.

The market’s current view is that the only possible salvation for shareholders is through partnering or merging. The company talked about both at the full year results, but neither were raised with the recent results. This company must partner VAP, or LANI, or RSV or if not merge the company while it still has assets.

Hopefully there is a major shareholder out there who agrees, or better yet, has a better plan. The Company should know that the still significant Australian shareholder base will not support it if it comes to a proxy fight.