The Ariad Disease

Do you have it?

I do.

Honestly,  I do.   And you probably do too. Its symptoms are hard to deny.  Your portfolio is horridly unbalanced,  way overweight in Ariad. Or exclusively so. 

Like mine.

You read all the message Ariad boards.  Study them. The "handles" 2da and BR mean something to you (very different things, if you're a true devotee).  You've mastered an oncology vocabulary as best a lay person can, and you know about how one cancer drug can or might be able to treat multiple different types of cancer.  KRAS means something to you, something really big and unimaginably good IF 788 is successfully targeting it. (That would be so amazing, no?).  And you check the share price throughout the day. Because too much in your life depends on it.  Just like mine.

But this isn't really normal investment behavior, not to the degree that the truly infected behave.  It is an obsession.  It's an invasion of, a capitulation of normalcy - you know, that sort of investing where you pick some stocks or funds and you check them every three months. Or six. Or once a year.

Here's the good news. There are two cures, one hopefully more likely (and I'm clearly wagering much more likely) than the other. The less likely, in my view, my diseased view, is that Ariad limps along at 7 or 8, or less, and the patients (you and me) eventually give up and sell...in a year, or two, having wasted a lot of time.

The second cure, the one we're all hoping for, is the damn company is sold. $15, 20, 25 or more if we're outrageously lucky and Denner saves the day.  That's the cure I'm hoping for.

In the meantime, if you've read this far, accept that you too have the Ariad Disease.  I do, and if the second cure happens - if either cure happens - I'll never invest this way again.  I'm joining AA. "Ariad Anonymous."

Good luck to all,

TC

End Game

It's over.

Ariad will likely be sold in the next 2-4 weeks.  Sale price at least 25, possibly 40.

Why?

1. No news of AGM. Ariad investor relations (Kendra Adams) has written to me twice,  promising a date for the proxy and AGM announcement, but there is still no announcement. Anyone who does not see this as fishy is smoking crack.

2. Harvey is out.  Ahead of schedule.  This means a deal is on the table,  and he was the only thing holding it up.

3. BRIGA is BTD, 788 is probably focused on KRAS. HUGE.  Big Pharma would die and go to heaven for this IP.   They need it.

4. Assets,  including Ariad, have a shelf life. Denner knows this, and he's no fool. MIT, Yale, Ichan. He has been well trained.

5. Clock is ticking. Denner has been in Ariad for 18 months, the drama with Harvey was taxing,  and it's time to declare victory and move on.

6. Calm before the storm.  Volume has been abysmal.  Nobody with any sense wants to trade, and tute ownership is at a record 80%.

Hang on to your shares for dear life, and acquire more if you have any cash.

Glta

TC

Conspiracy Theory

Point one. I wrote to Kendra two weeks ago to ask when details about the AGM would be released, along with the proxy ballot. She replied within 15 minutes noting it would be sent no later than May 15th. When it did not appear yesterday, I wrote her back. I did not get a reply - which is unusual for her. 

Point two. Scheduling and announcing an AGM is not rocket science, and requires no high level intervention. Leadership picks a date, consistent with previous AGM schedules, and underlings make an announcement. 
Point three. Now that we are a month late on the announcement, and Kendra has gone underground, I am going to fan the conspiracy theory fires and postulate that something is up.
The conspiracy prediction. We will likely have either news of a buyout, a new/interim CEO, or both by the end of next week. 
Hope you all have a good weekend, and looking forward to getting your missives on the conspiracy theory. 
Cheers, and GLTA. 
TC 

FDA Clarification On Orphan Status for Ponatinib

I wrote to the FDA to get clarification on pona's Orphan designation vs Aproval.  Here is their reply verbatim.

Orphan drug designation is a special status that is awarded to a drug or biological product (“drug”) to treat a rare disease or condition upon request of a sponsor.  For a drug to qualify for orphan designation both the drug and the disease or condition must meet certain criteria specified in the orphan drug regulations at 21 CFR Part 316.  One of these conditions is that the sponsor must submit the request for orphan drug designation prior to the application seeking marketing approval for that particular use.  The drug may have received marketing approval for other uses, including uses that are not to treat a rare condition or disease.

In terms of ponatinib for use in the treatment of gastrointestinal stromal tumors (GIST), the product has achieved designation status but has not received FDA marketing approval for that use.  Ariad cannot market ponatinib for the GIST orphan use unless they submit a marketing application for the drug and it is approved.

I hope this provides clarification.

[Signed]

[xxxxxxxxx], R.Ph.
Health Science Administrator
Office of Orphan Products Development
Food and Drug Administration 

What is 788? An Open Letter to Harvey and Alex

Oye Vey... enough already.

Seriously, I'm REALLY.   This is too much. Ariad Investors have displayed the patience of Job, but guys,  really, even Job got and answer in end  - not to mention a substantial increase in his holdings,  if I remember correctly.

Harv, Alex, you guys totally promised the new molecule would be out last year - you didn't say we're going to get a bloody number (!).   No target, no indication,  no idea what the hell it does or if it's any good ...  NADA!!!!!! 

So come on boys, throw us lowly retail investors,  us miserable ants, a bone. A crumb, even...would that be too much? 

Tell us what the hell 788 is all about.  The number does nothing, and we put our faith in you guys. For Nada???

Enough already. 

TC

 

Denner's Game

For the sake of argument,  let's consider this is Denner's game.

1. Denner understands that Ariad's products and pipeline are significantly undervalued by the Market.

2. Denner concludes that Big Pharma understands Ariad's  true value and would be willing to pay much more than post crash valuation.

3. Denner buys lots of shares, with the hope of flipping them to BigPharma in 24 months (his term on board)

4. Denner signs on to Ariad board knowing HB will be impediment no 1, but has to help turn around the ship and work with Harvey for a while to make the company credible. Thus he cuts deals and partnerships and probably helped with 113 application for Breakthrough Therapy Designation (BTD) - which is granted.

5. While turning around the ship, Denner courts big pharma partners,  and assures that other institutional investors are aligned with his game plan. Tute's holdings increase to 71%.

6. While all this is going on, Denner has been in discussions with Harv about buy out, but gets no traction.  Harvey refuses both the buy out, and the possibility of stepping down.

And now it gets interesting....

7. Knowing that further discussions with Harv are futile,  he now openly declares war.  This declaration is the CNBC "leak" (as we say in Washington).

8. Having publicly declared war with Harv, there is no going back. We are now officially in the end game. Clock is ticking.

9. Note: he could only move to end game position if agreements with BigPharma and other tutes are in place.

10. Why publicly declare war?? Simple.

A. Telegraph tutes to hold positions (note low volume recently, in spite of drama).

B. Position his conclusion as only logical one for Ariad and investors (can't continue with disgraced CEO).

C. Ramp up the pressure,  because that is precisely what activist investors do to achieve their objectives.

11. When Harv is forced out in, say, 30 to 90 days,  sell the company to Big Pharma, per prior negotiations,  and move the hell on...with a much stronger brand for Sarissa, and another notch in Denner's belt.

Game Over.

GLTA

TC

EARTHQUAKE TODAY???

The tectonic plates have moved, the earth has trembled, and the inevitable is underway...and soon the markets will open!

Denner has publicly declared war on Harvey. On CNBC, no less.  If he doesn't move Harv out through "an agreement with the company,” he’s waging  a proxy war.  Which he will win. 

Harvey is shaken.  Visibly so.  During his last interview, he forgot the name of 113 (the journalist reminded him it was Brigatinib), and he became incoherent when queried about his relationship with Denner.  END GAME.

So what now?

Sale.  Possibly a fire sale. Denner has 27% of Sarissa’s holdings in Ariad, nothing to show, and its been over a year.  $100m plus on the line. Bad. Bad. And Bad again.  After investing so big, tying up so much capital – dead money – for so long, it’s time to move on.   And that means selling Ariad to the highest bidder. Pronto!

Low end, $15pps.   

Disgraceful, below the pre-flash crash price, and the old school Ariad crew will be outraged (and out of pocket).  Denner, however, can declare a 100% plus profit, move on to the next battle, and be done with all this yucky drama with Berger and his aspirations to be President For Life. That’s the worst case, and it happens in 60 days.

High end, $35 pps.  

This happens if the God Molecule woos big pharma,  Brigatinib is on the verge of FDA approval, and there’s good news on Pona dosing trials on the way.  60 days, 90 max, and it's over. OVER!

Either way, shorts are toast and the (new) longs’ patience will soon be rewarded.

Good luck to all.

TC

Who's Your Daddy?

Who to believe?

In one corner, we have....

• Otsuka
• Denner
• Blackrock
• Fidelity
• Other Tutes
• The FDA (giving AP26113 BTD)
• commercial agents throughout Europe, Eastern Europe, Asia (see above) and of course Australia
• Docs and patients who went to bat after the debacle
• Science (just peruse prior abstracts from publications about Pona, 113 etc....multiple indications, impact, efficacy...and, yes, learning how to manage the risk/benefit trade off).
• A logical plan about the strategy for growing the company, and a conservative scenario of $400m revenues in 3 years.

And in the other corner, we have...

• Daily bashers (shorts in long's clothing?)
• daily market fluctuations
• bitter investors that didn't sell when we were at 20+ (not that I can blame that, it's just them emotion clouds one's judgement). 

So, who's your daddy?

GLTA

TC

BOOM!

God molecule going to clinic, partnership on AP26113.  Read all about it!

Press release

A P 26113 Approval In February...or more likely July?

Looks like approval might come earlier than we thought. 

Here is a recent  article which estimated time from BTD to approval at four months.  

BTD approval speed

However, I did the math, using data published on the FDA web site (FDA) as well as press released from individual Pharma companies re BTD announcements.  I found that the average days to market was 235, or roughly 8.8 months.   That would suggest an AP26113 approval date somewhere around July (my estimate in a prior post was August, so not much as changed).   However, as I noted previously, the approval can be as fast as 55 days (Amgen's Blincyto), or as long as 498 days (Merck's Keytruda)  

Hang in there everyone. 

TC

God Molecule Coming Wednesday: update

What would happen? 

First of all, this could happen. The molecule has been nominated, which was an internal corporate event. Investor relations (Kendra) has also been clear that they would share the profile of the molecule at an appropriate public event.  So go figure.

• God Molecule nominated. Check.
• Biggest healthcare conference of the year is happening next week. Check. 

There isn't a better time to unveil The God Molecule.  And when they do, and if it is good,  it will be an extremely interesting day. Big Institutional investors will want in.  Shorts will be trapped at the exit. And the outcome could conceivably be a 100% plus increase in share price.  

UPDATE:  I wrote to Kendra at investor Relations and asked her to confirm if the internal nomination for the new molecule happened.  Her reply was that "She encourages that [we] listen to the webcast at the JP Morgan conference for a full update." 

This is not a good time to sell.

Good luck to all.

TC

AP26113 Approval could come at any time based on existing data

Short Version of the Story: Ceritinib received FDA Approval based Phase One Trail data that was that was inferior to AP26113 Phase I/II data. As such, FDA approval for AP26113 could come at any moment, and the FDA might not wait for results from the Alta Phase II trial (for which recruitment is now underway).


Long Version of Story...

First of all, things can move quickly.  Let's take the Ceritinib, which received FDA Approval based on PHASE ONE trail data.  Here's the language about that data.

In April 2014, the next-generation ALK inhibitor ceritinib received an accelerated approval as a treatment for patients with ALK-positive NSCLC following progression on crizotinib. This approval was based on phase I data from the ASCEND-1 trial showing an overall response rate (ORR) of 58.5%. The early median duration of response was near 7.5 months - See more at: http://www.onclive.com/peer-exchange/nsclc-needs/Next-Generation-ALK-Inhibitors-in-NSCLC#sthash.g9PjxxjH.dpuf   Source 

Now, let's compare that to the AP26113 Phase I/II Trial Data Results (and note it's phase I/II, not just phase I):

The objective response rate (The objective response rate (ORR) in 72 evaluable patients with ALK-positive NSCLC was 72%. The median duration of response was 49 weeks. The median progression-free survival (PFS) was 56 weeks. In the 65 evaluable patients treated with prior crizotinib, the ORR was 69% with a median PFS of 47.3 weeks.  In 7 evaluable patients with treatment-naïve ALK-positive NSCLC, AP26113 demonstrated 2 complete and 5 partial responses, for an ORR of 100%. In patients with untreated or progressing brain metastases (n = 14), 71% of patients had evidence of radiographic disease improvement. - See more at link     

Now, you do the math.   AP26113 has better clinical data than a drug that the FDA recently approved based on Phase I Clinical Data.

The punch line is that AP26113 Approval could come at any time. 

   

2015

Away we go...

Japan deal done.  Check. 

AP26113 gets FDA Breakthrough therapy Designation.  Check

Financing in place for at least next nine months.  Check. 

Billionaires going long on Ariad. Check.

God Molecule coming any day now.  Check

2015 is going to be fun.  I can't wait.

Merry Christmas everyone. 

TC

please send this letter to Kendra Adams at IR

Kendra.Adams@ariad.com

Dear Ms. Adams,

The year is now coming to a close, and  many are wondering if Dr. Berger will be honoring his commitment to announce the new molecule in 2014.  Could you kindly advise if Ariad will be respecting this comittment to shareholders?

Best regards,  and thank you.

[Your Name]

ASH Flash 3: Strong Evidence of Superior Efficacy and Durability of Response with Ponatinib vs. Bosutinib

From American Society for Hematology conference:

Paper No: 3154
Benefit-Risk of Ponatinib Vs. Bosutinib in Chronic Phase Chronic Myeloid Leukemia (CP-CML) Patients Who Failed Two Prior Tyrosine Kinase Inhibitors (TKIs): An Indirect Comparison
Moshe Yair Levy, MD, Baylor University Med Center

CONCLUSIONS:  Our indirect comparison using a variety of surrogate measures provides strong evidence of superior efficacy and durability of response with ponatinib vs. bosutinib in 3L CP-CML patients; the higher proportion of ponatinib patients continuing on therapy and the longer duration of therapy also suggest patients experience better overall response and tolerability outcomes with ponatinib vs. bosutinib.  Based on the surrogate measures of patient benefit- risk examined in this analysis, ponatinib appears to provide a net overall benefit vs. bosutinib in 3L CP-CML patients.:  

ASH Flash 2: Initial Data Show Responses are Maintained After Dose Reduction

From the American Society of Hematology:

3135 Long-Term Follow-up of Ponatinib Efficacy and Safety in the Phase 2 PACE Trial

Program: Oral and Poster Abstracts
Session: 632. Chronic Myeloid Leukemia: Therapy: 

Conclusions: Ponatinib continues to exhibit deep and durable responses in heavily pretreated pts with longer follow-up, particularly CP-CML. A dose reduction strategy was implemented in response to the observation of ATEs.  Initial data show responses are maintained after dose reduction; longer follow-up is needed to understand impact on safety.  A dose-ranging trial of ponatinib in refractory CML to evaluate benefit/risk is being planned.

ASH Flash 1: Ponatinib Doses as low as 10 mg were still associated with disease control overall.

From the American Society of Hematology:

3153 High-Resolution Analysis of the Relationship Between Dose and Molecular Response in CP-CML Patients Treated with Ponatinib or Imatinib

Program: Oral and Poster Abstracts
Session: 632. Chronic Myeloid Leukemia: Therapy: Poster II

Conclusions:

BARD enables a detailed exploration of dose-response relationships in CP-CML.  In newly diagnosed patients, ponatinibdoses as low as 15 mg induced more rapid decreases in BCR-ABL levels than 400 mg imatinib.  Consistent with the possibility that sequential treatment with TKIs increases the degree of BCR-ABL independence, the magnitude of BCR-ABL decreases induced by ponatinib in heavily pretreated patients was reduced compared with newly diagnosed patients. Nonetheless, ponatinib doses as low as 10 mg were still associated with disease control overall.  These analyses will help inform the design of future studies aimed at optimizing the benefit/risk of ponatinib treatment for patients with CML.

The God Molecule Countdown: T-31

Is the God Molecule (i.e. next Ariad molecule) a "Third Generation" TKI?

A strong medical need still exists for better tolerated therapy to treat NSCLC patients harboring EGFR mutations. Here we report the discovery and development of a potent third generation, irreversible mutant-selective EGFR TKI that is expected to improve/maintain efficacy on oncogenic EGFR mutant patients while demonstrating reduced side effects. EGF816 potently inhibits both activating (L858R and Ex19Del) and T790M resistant mutations in various cellular assays; it is selective against a large panel of kinases in both Ambit and BaF3 profiling, and more importantly is selective against WT EGFR. EGF816 is efficacious in mutant EGFR-driven xenograft models, is well tolerated in IND-enabling toxicology studies, and is entering phase 1 trials.

The God Molecule Countdown: T-32

Will it be KRAS related?

If so, that would be profound and we would quickly be to 30.

KRAS

More to follow. Watch this space

TC

God Molecule Countdown: Day T-34

Here we go.  Reason 1 to love the God Molecule - This one from Jesspro on iHub.

Ariad's probable advantage with the New molecule is that, during clinical trials, its performance will likely be compared to placebos as there - this because there are no current treatments for "unmet medical needs,"  which is how Ariad has described the purpose of this new molecule.   As a result, even a modest advantage in the trials over placebos maybe considered successful.  Furthermore, once P1 and P2 have been completed, and if they are successful, accelerated approval could follow. Unlike 113 and pona(CML), which had to  compete with existing therapies,  the Nmole development may not be as expensive and could advance more quickly. 


 Note: The following is from Kendra at Ariad IR regarding the God Molecule

Kendra Adams <Kendra.Adams@ariad.com>	Sep 30
to me

We have communicated that we expect to nominate our next development candidate by year-end.

Regards,

Kendra