The congrats this week went to PropThink contributor Ivan Deryugin for his early December suggestion to buy BDSI ahead of a crucial phase 3 readout. The position is up 90% in less than 60 days.
On Thursday after the bell, BioDelivery Sciences announced positive results from the phase 3 BUP-308 study testing BEMA Buprenorphine in opioid- naive patients with chronic pain. Details were sparse, but investors are breathing easier as an opioid-naive subset of patients caused issues in a previous late-stage trial.
With its proprietary drug delivery system – BioErodible MucoAdhesives (BEMA) – and increasing evidence that BEMA Buprenorphine is an approvable product, the company is positioned to take share of two sizeable pharmaceutical markets. For the full backstory, and to understand why we’re still buyers, read Mr. Deryugin’s December article.
Last Monday Tekmira Pharmaceuticals (TKMR) delivered on the ‘biz dev’ side of things. Tekmira has been talking up potential licensing deals since settling IP litigation with Alnlyam in 2012, and on Monday announced an Option Agreement with Monsanto (MON) allowing Monsanto to obtain a license to use Tekmira’s proprietary Lipid Nanoparticle Delivery technology in agricultural settings. The deal was worth $16.5M up front and is a sign that LNP isn’t just being bypassed for newer RNAi delivery technologies, a sentiment that has weighed on TKMR. Here’s what we wrote to PropThink Premium members on the 7th of January when we outlined why TKMR is a compelling long:
We continue to believe that owning TKMR makes sense ahead of some incremental catalysts, and as the company continues its “rebranding” campaign. At $7.76, new investors can buy TKMR for less than institutional investors who participated in the company’s October secondary offering, which priced at $8.00. . .Value driving events, surprise business development events aside, will be sparse in 2014, but TKMR is attractive into mid-year and the release of phase 2 data for TKM-PLK1.
. . . Furthermore, the company has continually said that since the settlement of IP-related litigation with Alnylam a year ago, they have only just begun ramping BD efforts, which could mean some new partnerships this year. We’re not holding our breath, as this is standard talk in the industry, but new deals utilizing Tekmira’s LNP delivery tech could offer surprise upside in 2014.
Sure enough, the Monsanto deal has been good for almost five points of upside, a return of 56% for early-January buyers; TKMR is up 250% from our first purchase last year.
A highlight of the week was releasing Mr. King’s interview with professional investor and filing Sarepta (SRPT) & Neptune (NEPT) shareholder, George W. Haywood. Mr. King sat down with Haywood to understand his longterm thesis on SRPT, and to hear his thoughts on eteplirsen, the FDA, and GSK/Prosensa (RNA). Haywood also explained why he’s bullish on NEPT. Click here to read the interview.
