Conjuchem Thread
- Thread starter Doughboy
- Start date
8/28/03
Quick note to be followed by more details later. I am buying ConjuChem in my personal account and recommending it. It trades on the Toronto exchange under T.CJC. You can buy in the US under CJHMF but difficult to know what is happening and on which small exchange it is selling --so suggest using the Canadian exchange. The stock is moving up strongly based on recently reported data from a trial with GLP-1 for diabetes. A similar protein has been the basis of Amylin's (AMLN) recent advance. Amlyin?s exenatide has been featured at the current International conference on Diabetes (IDF), which is still going on (there is increasing publicity about the GLP-1 story and CJC?s early trial has gotten attention). The target seems well validated and CJC's product has a longer half-life and is non-immunogenic but studies are still very early. The market is huge and I bet they get a good partner soon. The stock is at $3.97 Canadian. I am not placing it in the Model Portfolio because the Model?s tracking system will not update prices on Canadian stocks (at some point I will have to fix that problem).
Quick note to be followed by more details later. I am buying ConjuChem in my personal account and recommending it. It trades on the Toronto exchange under T.CJC. You can buy in the US under CJHMF but difficult to know what is happening and on which small exchange it is selling --so suggest using the Canadian exchange. The stock is moving up strongly based on recently reported data from a trial with GLP-1 for diabetes. A similar protein has been the basis of Amylin's (AMLN) recent advance. Amlyin?s exenatide has been featured at the current International conference on Diabetes (IDF), which is still going on (there is increasing publicity about the GLP-1 story and CJC?s early trial has gotten attention). The target seems well validated and CJC's product has a longer half-life and is non-immunogenic but studies are still very early. The market is huge and I bet they get a good partner soon. The stock is at $3.97 Canadian. I am not placing it in the Model Portfolio because the Model?s tracking system will not update prices on Canadian stocks (at some point I will have to fix that problem).
Biotech Insight Alert 8/31/03
Biotechs have been strong again especially the small to mid-caps. I wrote a quick note about ConjuChem this week noting that I like the technology but could not put it in the Model Portfolio because daily Canadian quotes are not tracked by my tracking system. I did buy some in my personal account. CJC is traded on the Toronto exchange and is currently at $4.07 Canadian. CJC?s market cap. is about $142 million Ca.. In my mind this makes it a very cheap company considering that the target and therapy have been validated by Amylin?s (AMLN) studies with exenatide. Both of these companies are using a peptide hormone either similar to or identical to human GLP-1 to treat type 2 diabetes. The remarkable feature of these molecules is that they sense the level of blood sugar and only act when it is too high. Their side effect profile does not include hypoglycemia, which is the case with to much insulin or some of the oral agents. Another remarkable property is that GLP-1 causes weight loss which is a big plus for type 2 diabetics. Novo is another competitor in the GLP-1 field.
CJC has a remarkable technology that puts a linker on small molecules and peptides with an activated group at the free end. The concept is that when the drug plus linker is injected IV or SC the activated group binds covalently with serum albumin and creates and active product with the same half ?life (19 days) and volume of distribution as albumin, which is not excreted by the kidneys. This technology turns drugs that have a short half-life into ones with a long-half life. The end result is that you have a much longer acting drug with less frequent dosing. CJC tried using this technology with a few other molecules over the last two years but for one reason or another these projects were unsuccessful. However the GLP-1 program was always the jewel in their crown. Now that promise seems to be materializing.
CJC recently reported a fourth cohort of patients in a Phase I/II study in type II diabetics. These patients were off all other antidiabetic drugs. They showed tolerability and efficacy with good control of the main side effects, nausea and vomiting. Nausea decreased during the slow titration protocol and patients were able to get off anti-emetics quickly. They showed amazing efficacy for a short 20 day trial with significant reductions in fasting glucose, mean glucose, and body weight. HbA1c was not reported since this usually is a three month marker. Efficacy was also evident 7 days after the last dose. The implication is that after a brief titration their drug could be injected on a weekly SC schedule. As a comparison Amylin just released further data from a 24 week Phase III study showing good HbA1c (a measure of long-term blood sugar levels) control in type II diabetes using a twice-a-day SC injection of their GLP1 like product, exenatide. Weight loss, some nausea, and a lack of hypoglycemia are generic properties of all the GLP-1 like products. However exenatide, which is a synthetic copy of exendin 4 isolated from the saliva of the Gila Monster, causes a significant incidence of antibody formation. However the drug remained effective so the antibodies were not neutralizing antibodies. AMLN is currently working with Alkermes to develop a long-acting formulation (an IND was filed in March of ?03). AMLN?s market cap is 2.6 billion US and they are partnered with Lilly. So far CJC is not partnered with DAC:GLP-1, the formulation is already long-acting (most probably) and they have a market cap of only about $100 million US. Granted they are in very early trials and only reported on a small group of patients but their drug looks promising. One downside is that CJC is a Canadian company with little visibility in the US. I placed a bet on them because I like that they are using human GLP-1, their technology produces a long half-life product and early trials show a profile consistent with that of Amylin?s exenatide which must be injected twice daily. So far there is no evidence of antibody formation. I think a major pharma will make them an attractive deal and if CJC keeps control through Phase II trials the rewards could be very rich. I will probably add to my personal position.
Biotechs have been strong again especially the small to mid-caps. I wrote a quick note about ConjuChem this week noting that I like the technology but could not put it in the Model Portfolio because daily Canadian quotes are not tracked by my tracking system. I did buy some in my personal account. CJC is traded on the Toronto exchange and is currently at $4.07 Canadian. CJC?s market cap. is about $142 million Ca.. In my mind this makes it a very cheap company considering that the target and therapy have been validated by Amylin?s (AMLN) studies with exenatide. Both of these companies are using a peptide hormone either similar to or identical to human GLP-1 to treat type 2 diabetes. The remarkable feature of these molecules is that they sense the level of blood sugar and only act when it is too high. Their side effect profile does not include hypoglycemia, which is the case with to much insulin or some of the oral agents. Another remarkable property is that GLP-1 causes weight loss which is a big plus for type 2 diabetics. Novo is another competitor in the GLP-1 field.
CJC has a remarkable technology that puts a linker on small molecules and peptides with an activated group at the free end. The concept is that when the drug plus linker is injected IV or SC the activated group binds covalently with serum albumin and creates and active product with the same half ?life (19 days) and volume of distribution as albumin, which is not excreted by the kidneys. This technology turns drugs that have a short half-life into ones with a long-half life. The end result is that you have a much longer acting drug with less frequent dosing. CJC tried using this technology with a few other molecules over the last two years but for one reason or another these projects were unsuccessful. However the GLP-1 program was always the jewel in their crown. Now that promise seems to be materializing.
CJC recently reported a fourth cohort of patients in a Phase I/II study in type II diabetics. These patients were off all other antidiabetic drugs. They showed tolerability and efficacy with good control of the main side effects, nausea and vomiting. Nausea decreased during the slow titration protocol and patients were able to get off anti-emetics quickly. They showed amazing efficacy for a short 20 day trial with significant reductions in fasting glucose, mean glucose, and body weight. HbA1c was not reported since this usually is a three month marker. Efficacy was also evident 7 days after the last dose. The implication is that after a brief titration their drug could be injected on a weekly SC schedule. As a comparison Amylin just released further data from a 24 week Phase III study showing good HbA1c (a measure of long-term blood sugar levels) control in type II diabetes using a twice-a-day SC injection of their GLP1 like product, exenatide. Weight loss, some nausea, and a lack of hypoglycemia are generic properties of all the GLP-1 like products. However exenatide, which is a synthetic copy of exendin 4 isolated from the saliva of the Gila Monster, causes a significant incidence of antibody formation. However the drug remained effective so the antibodies were not neutralizing antibodies. AMLN is currently working with Alkermes to develop a long-acting formulation (an IND was filed in March of ?03). AMLN?s market cap is 2.6 billion US and they are partnered with Lilly. So far CJC is not partnered with DAC:GLP-1, the formulation is already long-acting (most probably) and they have a market cap of only about $100 million US. Granted they are in very early trials and only reported on a small group of patients but their drug looks promising. One downside is that CJC is a Canadian company with little visibility in the US. I placed a bet on them because I like that they are using human GLP-1, their technology produces a long half-life product and early trials show a profile consistent with that of Amylin?s exenatide which must be injected twice daily. So far there is no evidence of antibody formation. I think a major pharma will make them an attractive deal and if CJC keeps control through Phase II trials the rewards could be very rich. I will probably add to my personal position.
11/30/03
I will be adding 6000 ConjuChem (CJC.TO --on the Toronto exchange) to the Model (see archives). I wanted to do this for a while but just upgraded my stock-tracking program to follow Canadian stock quotes and translate to US dollars. To refresh, the CJC play is on DAC:GLP-1 (glucagon-like peptide) for diabetes and the DAC platform in general. This target has been validated by Amylin in multiple successful Phase III trials (partnered with Lilly). Other large pharmas are trying to go after the same target by inhibiting the enzyme (DPP IV) that destroys GLP-1. For example, Novartis has an orally available inhibitor, LAF237, in a Phase IIb trial. One problem with this approach is other possible reactions that will be inhibited by blocking this enzyme. I believe that larger Phase III trials have a high likelihood of showing up unwanted side effects with the DPP approach.. The miniscule market cap of CJC and the potential advantages of their product over the Amlyin product (longer half-life, no antibodies) make this a good gamble. They are much further behind but I expect that if the current Phase II trial is successful they will have a lucrative big pharma deal (pharmas love type 2 diabetes therapies?especially ones that promote weight loss and possibly rejuvenate insulin secreting beta cells).
I will be adding 6000 ConjuChem (CJC.TO --on the Toronto exchange) to the Model (see archives). I wanted to do this for a while but just upgraded my stock-tracking program to follow Canadian stock quotes and translate to US dollars. To refresh, the CJC play is on DAC:GLP-1 (glucagon-like peptide) for diabetes and the DAC platform in general. This target has been validated by Amylin in multiple successful Phase III trials (partnered with Lilly). Other large pharmas are trying to go after the same target by inhibiting the enzyme (DPP IV) that destroys GLP-1. For example, Novartis has an orally available inhibitor, LAF237, in a Phase IIb trial. One problem with this approach is other possible reactions that will be inhibited by blocking this enzyme. I believe that larger Phase III trials have a high likelihood of showing up unwanted side effects with the DPP approach.. The miniscule market cap of CJC and the potential advantages of their product over the Amlyin product (longer half-life, no antibodies) make this a good gamble. They are much further behind but I expect that if the current Phase II trial is successful they will have a lucrative big pharma deal (pharmas love type 2 diabetes therapies?especially ones that promote weight loss and possibly rejuvenate insulin secreting beta cells).
2/8/04
I have had other inquiries into my thinking about ConjuChem (CJC.TO?see archives) since the price run-up. I think it still has further to go. We should see the monotherapy trial data sometime by mid-year and we might see data sooner for the 30 day daily dosing portion of the trial. This trial basically repeats the first trial design for the first thirty days (escalating daily dosing to mitigate nausea, a common side effect with this class of drug). After the initial dose-escalation period subjects are split into 4 groups with either continuation of daily dosing, 3 times-a-week dosing, twice-a-week dosing or weekly dosing schedules. It is possible that if enough patients accrue quickly the company might take a look at the 30 day dosing and do some form of interim top-line data release but I don?t expect this. The really interesting data will be from the last part of the trial which will look at how often patients will need to take injections to maintain a response. Remember that Amylin?s Exenatide is given as a twice a day injectable and because the therapeutic window is relatively narrow I am not sure that Alkermes can come up with a sustained release formulation that truly avoids the nausea problem. I still think that CJC is undervalued. I am adding 3000 shares at $8.25 US to the Model Portfolio position.
I have had other inquiries into my thinking about ConjuChem (CJC.TO?see archives) since the price run-up. I think it still has further to go. We should see the monotherapy trial data sometime by mid-year and we might see data sooner for the 30 day daily dosing portion of the trial. This trial basically repeats the first trial design for the first thirty days (escalating daily dosing to mitigate nausea, a common side effect with this class of drug). After the initial dose-escalation period subjects are split into 4 groups with either continuation of daily dosing, 3 times-a-week dosing, twice-a-week dosing or weekly dosing schedules. It is possible that if enough patients accrue quickly the company might take a look at the 30 day dosing and do some form of interim top-line data release but I don?t expect this. The really interesting data will be from the last part of the trial which will look at how often patients will need to take injections to maintain a response. Remember that Amylin?s Exenatide is given as a twice a day injectable and because the therapeutic window is relatively narrow I am not sure that Alkermes can come up with a sustained release formulation that truly avoids the nausea problem. I still think that CJC is undervalued. I am adding 3000 shares at $8.25 US to the Model Portfolio position.
Originally sent February 23, 2004
buying 3000 shares of ConjuChem (CJC.TO-this can also be purchased on the US markets) at $8.50 US
buying 3000 shares of ConjuChem (CJC.TO-this can also be purchased on the US markets) at $8.50 US
3/7/04
ConjuChem (CJC.TO) pulled back slightly on Friday but I also still consider this company to be undervalued in relationship to Amylins (AMLN) valuation of $2.37 billion. Again this is an injectable (hopefully long-lasting) almost fully human form of GLP-1 in trials for type II diabetes. As stated in prior alerts this drug would seem to have big advantages over Amylins Exenatide in terms of antibody formation and half-life. The longer acting formulation of Exenatide is being developed by Alkermes and I think the release characteristics could be problematic. GLP-1 products all produce nausea and release formulations will have to deal with that by having very controlled release characteristics. Patient tolerance to all the GLP-1?s will be a potential pitfall but this can probably be overcome by titrating up the drug dosage along with initial antiemetics. If any company can get down to a once or twice-a-week injectable formulation without significant nausea they will have a real breakthrough product. This class of compounds clearly reduces the hemoglobin A1C level and has other theoretical advantages such as regeneration of beta islet cells. I have a large position in CJC and have been recommending it for a while. We should see some interim data on the daily dosing part of the current Phase II trial next month. The real competition may be from the large pharmas developing oral DPPIV inhibitors. This enzyme that breaks down GLP-1 and inhibiting it is another way of raising GLP-1 levels. My bet is that in large Phase III trials we will see side effects from this approach because DPPIV acts on other peptides as well.
ConjuChem (CJC.TO) pulled back slightly on Friday but I also still consider this company to be undervalued in relationship to Amylins (AMLN) valuation of $2.37 billion. Again this is an injectable (hopefully long-lasting) almost fully human form of GLP-1 in trials for type II diabetes. As stated in prior alerts this drug would seem to have big advantages over Amylins Exenatide in terms of antibody formation and half-life. The longer acting formulation of Exenatide is being developed by Alkermes and I think the release characteristics could be problematic. GLP-1 products all produce nausea and release formulations will have to deal with that by having very controlled release characteristics. Patient tolerance to all the GLP-1?s will be a potential pitfall but this can probably be overcome by titrating up the drug dosage along with initial antiemetics. If any company can get down to a once or twice-a-week injectable formulation without significant nausea they will have a real breakthrough product. This class of compounds clearly reduces the hemoglobin A1C level and has other theoretical advantages such as regeneration of beta islet cells. I have a large position in CJC and have been recommending it for a while. We should see some interim data on the daily dosing part of the current Phase II trial next month. The real competition may be from the large pharmas developing oral DPPIV inhibitors. This enzyme that breaks down GLP-1 and inhibiting it is another way of raising GLP-1 levels. My bet is that in large Phase III trials we will see side effects from this approach because DPPIV acts on other peptides as well.
4/12/04
Also ConjuChem is due to release data on the first 30 days of the Phase II trial (see archives for details). I am holding my shares since I have a fairly high confidence level that this part of the trial will be positive. Even if the second half of the Phase II shows at worst that DAC:GLP-1 needs to be given daily it is still better than the twice-daily dosing of Amylin's product. As most readers know I frequently sell in front of a big event but in this case I am not doing that.
Also ConjuChem is due to release data on the first 30 days of the Phase II trial (see archives for details). I am holding my shares since I have a fairly high confidence level that this part of the trial will be positive. Even if the second half of the Phase II shows at worst that DAC:GLP-1 needs to be given daily it is still better than the twice-daily dosing of Amylin's product. As most readers know I frequently sell in front of a big event but in this case I am not doing that.
4/14/04
On Monday ConjuChem (CJC.TO or CJHMF in the US ) released data on the first 30 days (including a titration period) of a Phase II trial on patients receiving DAC:GLP1. This is a monotherapy trial in which patients are taken off their current oral diabetic medications and treated only with the DAC product. Also there was no special dietary restrictions. The results were excellent. I had a number of inquiries asking me to comment?well the data was very solid especially the .8% decrease in hemoglobin A1C (a long-term measure of glucose control). This is very good in light of patients only being on full doses of drug for a short time (part of the 30 days was a titration period). Also when compared to an early study of Exenatide?a competing product-- (Diabetes Care, vol. 26 No. 8 August 2003) where drug was used for a 28 day period in combination with other oral diabetic medications and diet---the results were similar (in the Exenatide study HbA1c reductions were from .7 to 1.1%) but these patients were also on other diabetic medications and on a diet). One thing I found very interesting was that patients in the current study had a significant and this wasn?t the case in the short-term Amylin trial. According to CJC management the weight loss did not correlate with nausea and vomiting so this makes it even more impressive. Another point of comparison is that Exenatide was given either two or three times daily by injection while DAP:GLP-1 was only given once daily. Nausea was about the same in both studies and was a cause of dropouts?but this will be true for all the GLP-1 products (also any variation in delivery from a long-term formulation will run into real problems with nausea?this is a caveat about the Alkermes/Amylin trial with a longer acting form of Exenatide). There were no hypoglycemic events in the CJC trial?an important point. So with out going over all the details of the trial I think the results were great and I have a high level of confidence that release of data from the randomization phase (to longer dosing intervals) will show that DAC:GLP-1 can be dosed on a twice-weekly or better schedule---but we will have to wait for the results this summer to find out. The competition in the GLP-1 arena really boils down to a handful of companies: Amylin the leader in that they are in late stage clinical trials, Novo Nordisk?s about to start a Phase III trial of a once daily formulation called Liraglutide (they should have data at the ADA conference in June from a Phase II) and Zealand Pharma?s twice daily ZP10 (out-licensed to Aventis) in phase I/IIa clinical trials. The competitive landscape also includes the oral DPPIV inhibitors in development by a few big pharma (see archives for details). I think ConjuChem may have the best product?although Novo Nordisk has been very quiet about their entry. Certainly at a market cap of about $500 million (fully diluted US) this company still looks cheap. I am holding my position through the release of Phase II data, a NASDAQ listing and a partnership event.
On Monday ConjuChem (CJC.TO or CJHMF in the US ) released data on the first 30 days (including a titration period) of a Phase II trial on patients receiving DAC:GLP1. This is a monotherapy trial in which patients are taken off their current oral diabetic medications and treated only with the DAC product. Also there was no special dietary restrictions. The results were excellent. I had a number of inquiries asking me to comment?well the data was very solid especially the .8% decrease in hemoglobin A1C (a long-term measure of glucose control). This is very good in light of patients only being on full doses of drug for a short time (part of the 30 days was a titration period). Also when compared to an early study of Exenatide?a competing product-- (Diabetes Care, vol. 26 No. 8 August 2003) where drug was used for a 28 day period in combination with other oral diabetic medications and diet---the results were similar (in the Exenatide study HbA1c reductions were from .7 to 1.1%) but these patients were also on other diabetic medications and on a diet). One thing I found very interesting was that patients in the current study had a significant and this wasn?t the case in the short-term Amylin trial. According to CJC management the weight loss did not correlate with nausea and vomiting so this makes it even more impressive. Another point of comparison is that Exenatide was given either two or three times daily by injection while DAP:GLP-1 was only given once daily. Nausea was about the same in both studies and was a cause of dropouts?but this will be true for all the GLP-1 products (also any variation in delivery from a long-term formulation will run into real problems with nausea?this is a caveat about the Alkermes/Amylin trial with a longer acting form of Exenatide). There were no hypoglycemic events in the CJC trial?an important point. So with out going over all the details of the trial I think the results were great and I have a high level of confidence that release of data from the randomization phase (to longer dosing intervals) will show that DAC:GLP-1 can be dosed on a twice-weekly or better schedule---but we will have to wait for the results this summer to find out. The competition in the GLP-1 arena really boils down to a handful of companies: Amylin the leader in that they are in late stage clinical trials, Novo Nordisk?s about to start a Phase III trial of a once daily formulation called Liraglutide (they should have data at the ADA conference in June from a Phase II) and Zealand Pharma?s twice daily ZP10 (out-licensed to Aventis) in phase I/IIa clinical trials. The competitive landscape also includes the oral DPPIV inhibitors in development by a few big pharma (see archives for details). I think ConjuChem may have the best product?although Novo Nordisk has been very quiet about their entry. Certainly at a market cap of about $500 million (fully diluted US) this company still looks cheap. I am holding my position through the release of Phase II data, a NASDAQ listing and a partnership event.
6/21/2004
Last week a major medical conference on endocrinology produced some incremental news. A friend and consultant talked with Lilly about Exenatide. Lilly is partnered with Amylin in this product, which targets difficult type II diabetics. Lilly is very excited about Exenatide despite the fact that it is a twice-daily injection. They make the point that it is a fixed dose, which for the most part doesn?t need adjusting or careful monitoring. On the other hand insulin needs much more monitoring and dose adjustments because hypoglycemic reactions can be a significant problem. Lilly rightly claims that they are far ahead of competitors. Also Amylin (with Alkermes) is working on a once-a-week to once-a-month dose but this is only in Phase I trials and will be a difficult product to develop. The Exenatide antibody issue still persists and some patients do become resistant to the drug?this may not be a big deal but it still is a problem. The company has not been willing to break out their data according to patients with and without antibodies. Lilly?s excitement speaks well for ConjuChem and their DAC:GLP1 technology (see prior alerts for full details and stock tickers). Novo Nordisk is also developing a GLP1 drug adding further validation to this class. All this is another way for me to say that I still like ConjuChem even though the price has come down much.
Last week a major medical conference on endocrinology produced some incremental news. A friend and consultant talked with Lilly about Exenatide. Lilly is partnered with Amylin in this product, which targets difficult type II diabetics. Lilly is very excited about Exenatide despite the fact that it is a twice-daily injection. They make the point that it is a fixed dose, which for the most part doesn?t need adjusting or careful monitoring. On the other hand insulin needs much more monitoring and dose adjustments because hypoglycemic reactions can be a significant problem. Lilly rightly claims that they are far ahead of competitors. Also Amylin (with Alkermes) is working on a once-a-week to once-a-month dose but this is only in Phase I trials and will be a difficult product to develop. The Exenatide antibody issue still persists and some patients do become resistant to the drug?this may not be a big deal but it still is a problem. The company has not been willing to break out their data according to patients with and without antibodies. Lilly?s excitement speaks well for ConjuChem and their DAC:GLP1 technology (see prior alerts for full details and stock tickers). Novo Nordisk is also developing a GLP1 drug adding further validation to this class. All this is another way for me to say that I still like ConjuChem even though the price has come down much.
Alert 7/14/04
The other news is that ConjuChem (CJC on the Toronto exchange) announced results today on the full DAC:GLP-1 trial. The good news is that as we all guessed the drug works, the dosing will be much more convenient than for its competitor (Exenatide from Amylin) and there are no antibodies. It looks like many patients can be treated at least every other day as opposed to twice a day for Amylins drug. The bad news is that the nausea/vomiting rate is much higher than for Exenatide and the overall dropout rate was high. The company reported both high dropout rates because of nausea and about a 21.5% dropout rate because of consent withdrawal. I have never seen this kind of patient drop-out. What does consent withdrawal really mean??was this also due to nausea or something else?we will have to wait for the news conference to get clarity. I didn?t expect this high a dropout rate. In retrospect I wish I had gotten out of at least some of the position in front of these results.
There will be a news conference at 8.30 AM EST. I expect the stock to go down because of the high incidence of nausea and dropouts. How far it goes down depends on the particulars of this conference. For example, if in the second part of the study most of nausea was in the weekly or twice-a-week dosing schedule then it might not be so bad because at least you could have an every-other-day maintenance schedule and that would still be great. However the dropout rate in the titration phase is still too high and everyone is treated similarly in that part of the trial. Another factor that could soften the blow is if investigators found a way to mitigate nausea as the trial progressed. For example, if patients who enrolled later in the course of the trial had less nausea because of some subtle protocol change that would be important?but I?m afraid that is wishful thinking at this point. The real problem may be that the technology itself requires large amounts of drug, which gets bound to albumin. However there is a period when the drug is still free (not bound to albumin) and that may be a limiting factor in controlling the nausea. If that is the case then the nausea may be intrinsic to the DAC technology for GLP-1 and that would be too bad.
The next set of trials will be very important because all the GLP-1 drugs will be used as add-ons to oral agents and probably very little use will be the kind of monotherapy explored in this early trial. The patients in this trial were all on oral agents and doing poorly before entering the trial?a difficult to control group. Upon entering the trial they were taken off their other diabetic medications and then treated with GLP-1 as single agent therapy. In the next set of trials the company will be looking at real-world conditions were patients will be left on their original medications and have GLP1 added. Because of this combined therapy it may be possible to get by with lower doses, which might mitigate the nausea. This next set of trials will be similar in many ways to the pivotal trials that Amylin ran.
There is a growing body of literature which indicates that GLP-1 drugs can rejuvenate the insulin secreting cells in the pancreas and if that turns out to be the case these drugs will truly be revolutionary.
The other news is that ConjuChem (CJC on the Toronto exchange) announced results today on the full DAC:GLP-1 trial. The good news is that as we all guessed the drug works, the dosing will be much more convenient than for its competitor (Exenatide from Amylin) and there are no antibodies. It looks like many patients can be treated at least every other day as opposed to twice a day for Amylins drug. The bad news is that the nausea/vomiting rate is much higher than for Exenatide and the overall dropout rate was high. The company reported both high dropout rates because of nausea and about a 21.5% dropout rate because of consent withdrawal. I have never seen this kind of patient drop-out. What does consent withdrawal really mean??was this also due to nausea or something else?we will have to wait for the news conference to get clarity. I didn?t expect this high a dropout rate. In retrospect I wish I had gotten out of at least some of the position in front of these results.
There will be a news conference at 8.30 AM EST. I expect the stock to go down because of the high incidence of nausea and dropouts. How far it goes down depends on the particulars of this conference. For example, if in the second part of the study most of nausea was in the weekly or twice-a-week dosing schedule then it might not be so bad because at least you could have an every-other-day maintenance schedule and that would still be great. However the dropout rate in the titration phase is still too high and everyone is treated similarly in that part of the trial. Another factor that could soften the blow is if investigators found a way to mitigate nausea as the trial progressed. For example, if patients who enrolled later in the course of the trial had less nausea because of some subtle protocol change that would be important?but I?m afraid that is wishful thinking at this point. The real problem may be that the technology itself requires large amounts of drug, which gets bound to albumin. However there is a period when the drug is still free (not bound to albumin) and that may be a limiting factor in controlling the nausea. If that is the case then the nausea may be intrinsic to the DAC technology for GLP-1 and that would be too bad.
The next set of trials will be very important because all the GLP-1 drugs will be used as add-ons to oral agents and probably very little use will be the kind of monotherapy explored in this early trial. The patients in this trial were all on oral agents and doing poorly before entering the trial?a difficult to control group. Upon entering the trial they were taken off their other diabetic medications and then treated with GLP-1 as single agent therapy. In the next set of trials the company will be looking at real-world conditions were patients will be left on their original medications and have GLP1 added. Because of this combined therapy it may be possible to get by with lower doses, which might mitigate the nausea. This next set of trials will be similar in many ways to the pivotal trials that Amylin ran.
There is a growing body of literature which indicates that GLP-1 drugs can rejuvenate the insulin secreting cells in the pancreas and if that turns out to be the case these drugs will truly be revolutionary.
7/15/04
I am feeling fairly stupid today and of course don?t like making such bad calls---I am talking about ConjuChem (CJC on the Toronto exchange). It was a disaster and I apologize to all my readers for not suggesting selling part of a position in front of the trial results? The Company knew reaction would be unfavorable, which is why they probably announced results after the close yesterday with a conference call in the AM before the market opened. It was a rush to the door after that.
I am looking at what I learned from this fiasco. As most readers know I am usually cautious in front of a major event. In the case of CJC I had a high level of confidence that the drug worked and I was blind-sided by the magnitude of the nausea. So one lesson is no matter how confident still sell part of a position in front of a major event. Another lesson, which I am constantly relearning is not to be greedy. That is sell part of a position when you reach a predetermined profit level. In this case I rode CJC all the way up and all the way down (assuming the slide is over).
Now for some particulars of the trial. There is no question that DAC:GLP works?it lowers fasting glucose and it lowers long-term markers of hyperglycemia. I don?t think it is necessary to go into all the details. However, the dropout rate was very high. According to management some of the dropout was because patients had to come in daily for injections (including weekends and holidays) and this was a drag. Some other patients dropped out because they just couldn?t get good glycemic control and this is understandable since many patients couldn?t tolerate full doses of GLP and were difficult to control anyway on single agent therapy. So far no antibodies were reported and that is a good thing and one aspect that sets DAC:GLP-1 apart from Exenatide (19% patients develop antibodies?although not neutralizing).
The real problem is trying to decipher the nausea data. It would appear from this trial that patients randomized to all the dosing arms got some incidence of nausea?and this would tend to make me worry that it happens even at the lower once-a-day dosing levels. Also there was a significant early dropout rate during the titration phase, which was also at lower doses. The company?s response to this is that the titrations were done to quickly and that the next ongoing trial has slowed the titration down to no more than weekly increases. The nausea is caused by the small amount of free drug that circulates prior to it binding albumin. Because of the chemistry CJC must use much larger amounts of drug than Amylin. It may just be that even at lower doses of DAC:GLP there will be enough free drug to cause nausea. We have not seen the detailed data and this will be important because management claims that at the lower dosing range of 4ug/kg they don?t see much nausea. If that is true then I believe CJC has a viable drug and one that may be better than Exenatide. It is very likely that in real world combination therapy DAC:GLP will be effective in this range?and maybe even at every other day dosing. The major question is will patients drop out of the study because of nausea.
The next trial to report will be the combined therapy trial with metformin. There are two arms. One arm doses DAC:GLP-1 from 1-4ug/kg, which according to management should not cause nausea. I would be more convinced once I saw the full breakdown of the data from the just reported trial and that should be coming. The other arm doses DAC:GLP-1 from 2-8ug/kg.
Management also says that they are working on other diluents that might retard release of free GLP. That would be great but we have to make decisions on what is at hand.
CJC at the current price of $4.80 Canadian has a market cap of about $150 million US with working capital of $27.8 million. Even at these prices the technology valuation is still close to $125 million.
I am still keeping my shares and will probably keep the portfolio position. We will see more data by year-end on the current Phase II combination therapy trial. I think there is likelihood that the lower dosed arm may have a better side-effect profile. However I will feel more comfortable about that when I see the full data set from the just-released trial results and can hear management?s discussion of those complete results. The diabetic market is huge and it is not a sure bet that Amylin will be able to develop an extended release formulation that is nausea free. Amylin may also have more difficulties with antibodies in the long-acting formulation.
I am feeling fairly stupid today and of course don?t like making such bad calls---I am talking about ConjuChem (CJC on the Toronto exchange). It was a disaster and I apologize to all my readers for not suggesting selling part of a position in front of the trial results? The Company knew reaction would be unfavorable, which is why they probably announced results after the close yesterday with a conference call in the AM before the market opened. It was a rush to the door after that.
I am looking at what I learned from this fiasco. As most readers know I am usually cautious in front of a major event. In the case of CJC I had a high level of confidence that the drug worked and I was blind-sided by the magnitude of the nausea. So one lesson is no matter how confident still sell part of a position in front of a major event. Another lesson, which I am constantly relearning is not to be greedy. That is sell part of a position when you reach a predetermined profit level. In this case I rode CJC all the way up and all the way down (assuming the slide is over).
Now for some particulars of the trial. There is no question that DAC:GLP works?it lowers fasting glucose and it lowers long-term markers of hyperglycemia. I don?t think it is necessary to go into all the details. However, the dropout rate was very high. According to management some of the dropout was because patients had to come in daily for injections (including weekends and holidays) and this was a drag. Some other patients dropped out because they just couldn?t get good glycemic control and this is understandable since many patients couldn?t tolerate full doses of GLP and were difficult to control anyway on single agent therapy. So far no antibodies were reported and that is a good thing and one aspect that sets DAC:GLP-1 apart from Exenatide (19% patients develop antibodies?although not neutralizing).
The real problem is trying to decipher the nausea data. It would appear from this trial that patients randomized to all the dosing arms got some incidence of nausea?and this would tend to make me worry that it happens even at the lower once-a-day dosing levels. Also there was a significant early dropout rate during the titration phase, which was also at lower doses. The company?s response to this is that the titrations were done to quickly and that the next ongoing trial has slowed the titration down to no more than weekly increases. The nausea is caused by the small amount of free drug that circulates prior to it binding albumin. Because of the chemistry CJC must use much larger amounts of drug than Amylin. It may just be that even at lower doses of DAC:GLP there will be enough free drug to cause nausea. We have not seen the detailed data and this will be important because management claims that at the lower dosing range of 4ug/kg they don?t see much nausea. If that is true then I believe CJC has a viable drug and one that may be better than Exenatide. It is very likely that in real world combination therapy DAC:GLP will be effective in this range?and maybe even at every other day dosing. The major question is will patients drop out of the study because of nausea.
The next trial to report will be the combined therapy trial with metformin. There are two arms. One arm doses DAC:GLP-1 from 1-4ug/kg, which according to management should not cause nausea. I would be more convinced once I saw the full breakdown of the data from the just reported trial and that should be coming. The other arm doses DAC:GLP-1 from 2-8ug/kg.
Management also says that they are working on other diluents that might retard release of free GLP. That would be great but we have to make decisions on what is at hand.
CJC at the current price of $4.80 Canadian has a market cap of about $150 million US with working capital of $27.8 million. Even at these prices the technology valuation is still close to $125 million.
I am still keeping my shares and will probably keep the portfolio position. We will see more data by year-end on the current Phase II combination therapy trial. I think there is likelihood that the lower dosed arm may have a better side-effect profile. However I will feel more comfortable about that when I see the full data set from the just-released trial results and can hear management?s discussion of those complete results. The diabetic market is huge and it is not a sure bet that Amylin will be able to develop an extended release formulation that is nausea free. Amylin may also have more difficulties with antibodies in the long-acting formulation.
7/20/04
What can I say--- the biotechs are in the tank. Actually, what I can say is that this is the kind of wave that we?ve seen before in small-cap biotech investing. This is a severe downturn but it has happened before. Although it is hard to watch---if you?re in this for the longer-term as I am ?I just hang on and wait for a turn-around?and it will come. The old adage about buying low is what investing is all about (as well as selling right)?the call is what is low?I think now we are must be getting close to the lows. The depressed mood of our country is driving the psychology behind this market. I haven?t changed my fundamental opinions about the stocks in the Model Portfolio.
There is no specific news on any company today that has made a big difference. Another early Phase I study released by ConjuChem (see archived alerts) again shows that the DAC technology works. I expect more details of the recent GLP-1 study in a company conference later this month?I think this will shed more light on what we might expect in the way of nausea and perhaps efficacy in the next trial at the lower dosing level (1-4ug/kg). I think CJC is probably a good buy at these levels but then with the market dropping every day I am reluctant to be recommending anything.
What can I say--- the biotechs are in the tank. Actually, what I can say is that this is the kind of wave that we?ve seen before in small-cap biotech investing. This is a severe downturn but it has happened before. Although it is hard to watch---if you?re in this for the longer-term as I am ?I just hang on and wait for a turn-around?and it will come. The old adage about buying low is what investing is all about (as well as selling right)?the call is what is low?I think now we are must be getting close to the lows. The depressed mood of our country is driving the psychology behind this market. I haven?t changed my fundamental opinions about the stocks in the Model Portfolio.
There is no specific news on any company today that has made a big difference. Another early Phase I study released by ConjuChem (see archived alerts) again shows that the DAC technology works. I expect more details of the recent GLP-1 study in a company conference later this month?I think this will shed more light on what we might expect in the way of nausea and perhaps efficacy in the next trial at the lower dosing level (1-4ug/kg). I think CJC is probably a good buy at these levels but then with the market dropping every day I am reluctant to be recommending anything.
thanks doughboy for the posts any more info on this story would be appreciated.
he states "As most readers know I frequently sell in front of a big event but in this case I am not doing that."
that is what I try to do, sell some if it goes on a run, however I know two small cap managers with large gains that kept most if not all of their position. bought it at much lower levels than I did.
I mean if the test was good the stock would have gone up 20%+, so sometimes it is hard to know what to do....he writes in great detail, interesting points.
was wondering doughboy how much roughly (health related stocks are in the average US portfolio (drugs, hospitals, health care, ect).
I mean in Canada we only have a few names besides some small jr. companies. if you want to buy large cap pharma you buy US stocks.
thanks
selkirk
he states "As most readers know I frequently sell in front of a big event but in this case I am not doing that."
that is what I try to do, sell some if it goes on a run, however I know two small cap managers with large gains that kept most if not all of their position. bought it at much lower levels than I did.
I mean if the test was good the stock would have gone up 20%+, so sometimes it is hard to know what to do....he writes in great detail, interesting points.
was wondering doughboy how much roughly (health related stocks are in the average US portfolio (drugs, hospitals, health care, ect).
I mean in Canada we only have a few names besides some small jr. companies. if you want to buy large cap pharma you buy US stocks.
thanks
selkirk
Opinions please, down to $4.16CDN currently...is this a good buying opportunity with a bounce coming...or is this going to keep tanking?
07/25/04
ConjuChem (CJC on the Toronto exchange) has been a disaster and I obviously should have sold the portfolio position on the day they announced trial results. I was waiting for the conference on 7/28 to hear full data. I have a problem with the company being disingenuous in not revealing the drop-out rate and the high incidence of nausea when they announced results for the first part of the trial a few months ago. Year-end data from the current ongoing combination trial will be very important. A reformulation may set back the trial schedule but may ultimately be the solution. I will make a decision about CJC after their conference next week. This is potentially a very important class of drugs if they truly regenerate beta cell function. It is doubtful that oral DPPIV inhibitors will have the same effect since they probably don?t raise GLP-1 levels enough. So that leaves Amylin as the competition and for now if CJC?s drug can be given once daily that would still be better than the twice-daily dosing of Exenatide. However we definitely need more clarity on the nausea issue and whether a longer ramp up time and lower dosing will mitigate nausea but still control hyperglycemia. The long-acting Exenatide formulation is not a sure bet with nausea and antibody formation being the main potential problems.
ConjuChem (CJC on the Toronto exchange) has been a disaster and I obviously should have sold the portfolio position on the day they announced trial results. I was waiting for the conference on 7/28 to hear full data. I have a problem with the company being disingenuous in not revealing the drop-out rate and the high incidence of nausea when they announced results for the first part of the trial a few months ago. Year-end data from the current ongoing combination trial will be very important. A reformulation may set back the trial schedule but may ultimately be the solution. I will make a decision about CJC after their conference next week. This is potentially a very important class of drugs if they truly regenerate beta cell function. It is doubtful that oral DPPIV inhibitors will have the same effect since they probably don?t raise GLP-1 levels enough. So that leaves Amylin as the competition and for now if CJC?s drug can be given once daily that would still be better than the twice-daily dosing of Exenatide. However we definitely need more clarity on the nausea issue and whether a longer ramp up time and lower dosing will mitigate nausea but still control hyperglycemia. The long-acting Exenatide formulation is not a sure bet with nausea and antibody formation being the main potential problems.
Infinii the question is wether you think their drug will make it to market.
if it does then the stock is a great buy, if this does not work out the stock trades at a $1 or less.
I own a small position sold most of it before the news but did keep some; wish sold it all. the company has raised $25 million after the bad news and has enough money to keep going for 18 months.
also they can probably raise more money so they will be able to see if the drug works. most brokerage reports are still fairly positve that I read with much higher target price.
I would rate the stock a hold, it will probably trade sideways for a while. will keep my small stake. stop loss is $3.25. currently trading at $3.90cdn.
doughboy thanks for the info.
thanks
selkirk
if it does then the stock is a great buy, if this does not work out the stock trades at a $1 or less.
I own a small position sold most of it before the news but did keep some; wish sold it all. the company has raised $25 million after the bad news and has enough money to keep going for 18 months.
also they can probably raise more money so they will be able to see if the drug works. most brokerage reports are still fairly positve that I read with much higher target price.
I would rate the stock a hold, it will probably trade sideways for a while. will keep my small stake. stop loss is $3.25. currently trading at $3.90cdn.
doughboy thanks for the info.
thanks
selkirk
was wondering doughboy how much roughly (health related stocks are in the average US portfolio (drugs, hospitals, health care, ect).
Selkirk,
Not sure what an average invetor would have in their portfoolio in regards to healthcare, but a rough guess would be 10-25%? I know that people are adding more, and it is becoming much more abundant in portfolios that I am seeing, and I also am recommending an allocatiom. I definitely think there is great potential and many money managers say biotech could be the next dot-com type of atmosphere in the future. With the aging baby-boomers, I think they could be right.
I personally don't focus on too much big pharma, but mid-cap and small-cap late stage developmental companies in particular. I think with the right knowledge, you can make a killing. I just wish there were more options traded on some of these comapnies, so I could buy a pput in front of a big release of news.
Hope this gives a little insite.
Selkirk,
Not sure what an average invetor would have in their portfoolio in regards to healthcare, but a rough guess would be 10-25%? I know that people are adding more, and it is becoming much more abundant in portfolios that I am seeing, and I also am recommending an allocatiom. I definitely think there is great potential and many money managers say biotech could be the next dot-com type of atmosphere in the future. With the aging baby-boomers, I think they could be right.
I personally don't focus on too much big pharma, but mid-cap and small-cap late stage developmental companies in particular. I think with the right knowledge, you can make a killing. I just wish there were more options traded on some of these comapnies, so I could buy a pput in front of a big release of news.
Hope this gives a little insite.
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