Green Cross receives approval for Peramivir in South Korea

http://www.businesswire.com/news/home/20100816005534/en/BioCryst%E2%80%99s-Partner-Green-Cross-Receives-Marketing-Manufacturing

Peramivir has now received regulatory approval in both Japan and South Korea. In the US, Peramivir is in phase III clinical trials

BioCryst announces upbeat first quarter

http://www.marketwatch.com/story/biocryst-reports-first-quarter-2010-financial-results-and-provides-corporate-update-2010-04-28?reflink=MW_news_stmp

See disclaimers in side bar.

Disclosure: long BCRX shares.

Peramivir sales in Japan

Shionogi announced Peramivir sales targets for their fiscal year ending March 31, 2010.

http://www.shionogi.co.jp/ir_en/news/detail/e_100126.pdf

Based on conservative estimates of 700,000 doses at $34 per dose to $64 per dose, Shionogi expects revenue of between $23.8 million and $44.i million. With an assumed 20% royalty split, BioCryst Pharmaceuticals (BCRX) revenue from Shionogi sales in Japan over the next two months is between $4.76 million to $8.82 million. These revenue figures flow straight to the bottom line, and with 38.2 million outstanding shares, the earnings per share from Japanese revenue over the next two months is significant.

Sales figures do not take into account milestone payments due BCRX, and do not include the manufacturing mark-up from sales of Peramivir Active Pharmaceutical Ingredient (API) to Shionogi.

As noted, Peramivir is gaining traction worldwide, as regulatory approvals and emergency use authorization (EUA) have been secured in North America, Asia, Europe, the Middle East, and Latin America.

See sidebar for disclaimers.

Disclosure: long BCRX shares.

BioCryst revisited

Shares of BioCryst Pharmaceuticals (BCRX) have declined over 40% from its peak as fears of the complicated H1N1 pandemic flu virus have waned, but recent developments may be bullish for the investigational drug company.

According to this article, the CDC is receiving a request for the antiviral Peramivir at a rate of one per minute, under the FDA's Emergency Use Authorization (EUA). It's a convoluted way of ordering Peramivir, but for now, it's the only method for doctors to obtain the life-saving drug for critically ill patients.
http://www.minnpost.com/craigbowron/2009/12/09/14111/the_fury_of_h1n1_meeting_the_virus_in_its_most_virulent_form_face_to_face

Green Cross, a marketing partner for BCRX's Peramivir, recently received an EUA for South Korea.
http://seekingalpha.com/article/177249-biocryst-s-korean-partner-receives-emergency-use-authorization

Former CEO and Chairman of Glaxo and former Vice Chairman of Squibb Charles Sanders was elected to BCRX's Board of Directors. This could signal a buyout from a big pharmaceutical company.
http://www.google.com/hostednews/ap/article/ALeqM5iJXedGlOvEnPut4_IJ9UgVWBgZIwD9CFQKQ80

BCRX partner Shionogi has received fast-track review designation in their quest for regulatory approval in Japan. This gives Peramivir at least a year head start in Japan, as Peramivir is still undergoing Phase III clinical trials in the US. Approval in Japan for Peramivir should occur in the first half of 2010.
http://seekingalpha.com/article/177446-biocryst-h1n1-antiviral-partner-gets-fast-tracked-for-japanese-review

Disclosure: long BCRX shares.

Just in: Peramivir receives competition

http://www.nytimes.com/2009/11/06/business/06drug.html?_r=1

But peramivir will soon have competition. The federal government said late Thursday that it had also ordered 10,000 treatment courses each of intravenous versions of Tamiflu and Relenza, with options to buy 30,000 more courses of each.

Those drugs could not be used, however, until they received emergency use authorizations from the F.D.A.

The government is paying an average of only $450 a course for those other drugs — only one-fifth of what it is paying for peramivir.

Right now, Dr. Lurie said, peramivir is the only drug that can be used intravenously so the government had to pay a high price. “I would say that one of the things that happens in the market when you have competition is that the price drops.”

It looks like the government wants to create competition and reduce the price of intravenous (IV) anti-virals. The problem is that Tamiflu IV and Relenza IV, have not even gone through Phase 1 or Phase 2 clinical trials yet, much less Phase 3. Receiving Emergency Use Approval (EUA) will prove to be a challenge, as BCRX receiving EUA for Peramivir has been challenging enough--even after years of clinical trials.

This is a case of two big foreign pharmaceutical companies fighting back to regain market share they've lost to an upstart US biopharmaceutical company. Tamiflu and Relenza are still effective in many cases against the novel H1N1 virus in their present form, oral and inhalant, respectively. But the seasonal flu is almost 100% resistant to Tamiflu, and starting to show resistance against Relenza.

IV Peramivir has shown to have 90% efficacy in saving lives of complicated cases of the H1N1 virus--when all other measures have failed. If and when Tamiflu IV and Relenza IV receive EUA, it remains to be seen whether they can show similar capability in saving lives.

BCRX announces initial HHS order

BioCryst Pharmaceuticals (symbol "BCRX") announced shipment of an initial order from the Department of Health and Human Services (HHS). The order for 10,000 courses was for the amount of $22.5 million, setting a price of $2,250 per course for Peramivir, the intravenous anti-viral treatment for the novel H1N1 pandemic influenza virus. The order was shipped under the Emergency Use Authorization (EUA) issued by the Food and Drug Administration (FDA) on October 23, 2009. The HHS may order up to 30,000 more courses at the same unit price.

BCRX is manufacturing up to 130,000 courses total to be shipped by the end of the year, as they expect additional orders from other countries.

http://investor.shareholder.com/biocryst/releasedetail.cfm?ReleaseID=422102

In a related press release, "BioCryst Pharmaceuticals, Inc. (Nasdaq: BCRX) today announced that its partner, Shionogi & Co., Ltd. has filed a New Drug Application (NDA) in Japan to seek regulatory approval for intravenous (i.v.) peramivir to treat patients with influenza. As a consequence of this filing, BioCryst will receive a regulatory milestone payment of $7 million under its agreement with Shionogi."
http://investor.shareholder.com/biocryst/releasedetail.cfm?ReleaseID=421714

Disclosure: long BCRX shares.

Finally...

Biocryst Pharmaceuticals finally receives Emergency Use Authorization from the FDA for Peramivir, the intravenously-applied anti-viral for the novel H1N1 flu virus.

http://investor.shareholder.com/biocryst/releasedetail.cfm?ReleaseID=417887

Now doctors can get down to the business of saving lives for patients with severe cases of the swine flu.

Expect orders domestically and abroad.

Disclosure: long BCRX shares.

BioCryst sponsors a symposium at ICAAC

BioCryst Pharmaceuticals (BCRX) sponsored a symposium at the ICAAC conference last night on emerging therapies for novel strains of the flu:

http://www.icaac.org/index.php?option=com_content&view=article&id=57&Itemid=54

Intravenous Peramivir, BCRX's anti-viral against the flu, made news headlines as well:

http://abcnews.go.com/Health/wireStory?id=8562221

Now that President Obama and Congress have made appropriations for funding of vaccines and anti-virals to combat the pandemic flu, it is now in HHS Secretary Kathleen Sebellius' court to sign off on an order for the strategic national stockpile. The FDA will also have to issue an Emergency Use Authorization since Peramivir is not an approved treatment.

Currently, medical practitioners can order Peramivir for individual hospitalized patients through an emergency use investigational new drug (EIND) process. But an EUA needs to be issued so millions with complicated and severe cases can gain access to Peramivir. Peramivir saves lives--especially with novel strains becoming resistant to Tamiflu (Oseltamivir).

Swine flu portfolio rally

Shares of BCRX, NVAX, SVA, HEB, and APT all increased double-digit percentages today. I keep expecting the overall market to roll over and have protective puts in place--hence, the hedges keep eroding in value. But I am not complaining, given triple digit gains on the aforementioned stocks.

Exit strategies for longs need to be in place. But after polling several experts in the field, the swine flu will be worse than general public expectations. Also, very few understand the five vaccines and the anti-virals available, either approved or under Emergency Use Authorization review. Unless, of course, they've been reading these blogs for a few months (pardon the temporary lapse in modesty).

The most recent update is that egg-based vaccines won't be available until October, due to lower than expected yields. With a 21-day duration between doses, and one more week thereafter before immunogenicity kicks in, most students and young adults won't be immunized until November at the earliest. As noted before, with schools already in session, the swine flu will peak in October, rendering many vaccines useless among the targeted population.

Anti-virals will have to step in, even though Tamiflu has tolerability as well as efficacy issues due to resistance. Inhaled Relenza has limitations, so intravenously administered Peramivir has BCRX longs excited about an imminent EUA stockpiling order.

Good luck to all longs, and good luck to those who will become infected with the novel H1N1 virus.

Disclosure: Long shares in BCRX, NVAX, SVA, HEB, and APT.

BCRX and NVAX receive positive news

Leerink Swann, an investment bank specializing in biotech and life science companies, upgraded their price target on BCRX from $5 to $10, on an estimated Emergency Use Authorization order of $394 million for US stockpiling of the anti-viral Peramivir. The report was curious in the exact amount of $394, as the specificity could be a telegraph that an order is imminent. In any case, longs have been anticipating EUA for weeks, so the waiting game continues, as longs and shorts battle for positioning.

NVAX received good news this morning, according to an article in Indian Times. Cadila, a NVAX partner for their vaccine-like particle (VLP) flu vaccine, announced they are the first pharma company to produce a vaccine for the novel H1N1 virus in India. NVAX, in addition to receiving milestone payments, will receive 20% royalties on sales of the vaccine in India, meaning revenue from the Cadila partnership will go directly to NVAX's bottom line, as Cadila picks up all clinical development costs. Approval is expected by the end of this year. See previous blogs for NVAX value proposition and our investment thesis, mainly higher vaccine yields, faster vaccine production, and lower in-border manufacturing costs. All of these benefits are due to not needing eggs to produce the VLP vaccine. Under- and un-developed countries will greatly benefit due to faster ramp and lower cost structure, as well as the ability to control domestic manufacturing capacity. They won't be held hostage to foreign healthcare resources.

In fact, in a bit of irony, with India fast-tracking NVAX's VLP vaccine, the US may be on the outside looking in if vaccine production falls short. That would be a travesty considering NVAX is a US supplier of vaccines. This is another shameful example of the FDA dragging their feet, partly due to insidious pressure from incumbent big pharmaceutical companies to impede progress of promising competitive solutions from innovative upstarts like NVAX.

Tamiflu-resistant swine flu

The US has a huge stockpile of Tamiflu and Relenza as anti-virals. Anti-virals are treatments for patients who have contracted the various flus already--they are not vaccines and hence, are not used as prophylaxis in prevention of said influenza viruses.

http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5816a6.htm

Read the editorial note, not just the article. Down at the bottom, you will see this:

Compared with M2 blockers, NAIs previously exhibited lower frequency of antiviral resistance during therapeutic use (16,19). However, during the 2007--08 influenza season, emergence and transmission of oseltamivir-resistant A (H1N1) viruses, with a H274Y mutation in the neuraminidase protein, was simultaneously detected in several countries in the Northern Hemisphere (4,20--22) and spread globally (7,9,23). As of April 2009, similar trends have been observed in the 2008--09 influenza season, with many countries reporting up to 100% oseltamivir resistance in A (H1N1) viruses

.

In case you were wondering, oseltamivir = Roche's Tamiflu, currently the anti-viral of choice for the nation's stock pile. It no longer works for avian or swine flus! So if you're sick from the swine flu enough to get admitted into a hospital, they will probably administer Tamiflu orally, as it is a pill. I have seen government data that up to half of admitted swine flu patients in ICU end up dead. One other possible reason for resistance (besides prevalence of Tamiflu in our sewage and water system) is oral consumption decreases and delays absorption of the compound. One of the members in this email thread used to work at Roche, perhaps he can add some color to this assessment.

The 2nd drug of choice is GlaxoSmithKline's Relenza, or zanamivir. It has maintained efficacy for treating various strains of flu, and is in the form of powder. If a patient is seriously ill enough to be intubated, that option is ruled out because Relenza can only be inhaled.

Which only leaves us with BCRX's Peramivir intravenous application as the only option. The share price has gapped up recently, despite only completion of Phase II clinical trials in the US. It is already approved for E-IND use, which basically allows individual doctors to administer it for individual patients as an emergency. But due to its efficacy, investors are waiting for Emergency Use Authorization, which allows national stockpiling, despite lack of FDA approval. This will translate to millions of doses, not just a few thousand.

Many investors feel this action is not just pending, but imminent. Vaccine manufacturers are scrambling to meet exploding demand--and they will still fall short, as best-case scenarios call for delivery in October. Unfortunately, school starts in August/Septemer, so we will unquestionably see a soaring number of cases this fall--rendering vaccines useless. Fortunately, most cases will be mild, and won't require hospitalization. But due to the high infectious rates, and sheer numbers of cases, hospitalization and death rates will be higher than seasonal flu cases by orders or magnitude.

http://news.yahoo.com/s/ap/20090724/ap_on_he_me/us_med_swine_flu

http://www.cbsnews.com/stories/2009/07/21/earlyshow/health/main5177452.shtml

Government health officials aren't in business to create unnecessary hype--quite the contrary--they aim to act quickly and decisively while attempting to not cause undue panic. They usually fail in both. However, they are on the hook to prepare for a worst-case scenario, and they will look awfully foolish if they don't take emergency measures as part of their contingency plans. In Japan and the rest of Asia, where sensitivity and awareness to infectious disease is high due to close living quarters, their FDA equivalent health agency has already completed Phase III trials, and results for Peramivir were positive. Approval in Japan will precede US FDA approval, and they will surely order millions of doses of Peramivir.

While FDA approval for Peramivir is further down the road, they will have to act soon in order to secure enough Peramivir inventory to prepare for a worst-case scenario. Because the public will not appreciate it if they find out their own US government is forced to stand in line--behind other countries because they didn't act quickly enough to protect their citizens.

I bought BCRX in the 2's and 3's in May and June, and it's currently bumping up against $10. I'm praying for a pullback to accumulate more shares, but I'm afraid the world is waking up to the severity and depth of the swine flu. It may keep increasing, as the big boys on Wall St. become more cozy with the investment thesis. However, with market makers, you never know, and they can force one more bear raid to help the shorts cover, and to help their friends at Goldman Sachs buy in at lower prices. Wall St. analysts usually don't get it right, so when they guess wrong, they have friends who come to their rescue to drive share prices down. Instead of complaining about it, we can use it to our advantage, buying at lower prices when the opportunity presents itself. But it can easily gap up into the teens upon arrival of the EUA. Let's hope all the fear-mongering ends up being a false alarm. On the other hand, I'm not betting on it. Good luck to all longs,

Disclaimer: This is not a recommendation. Do your own due diligence.

Disclosure: Long BCRX shares.

Why Tamiflu may not help

The season, avian and swine flu strains are developing a resistance to Roche's anti-viral Tamiflu. Here are the possible reasons why:

http://www.sciencedaily.com/releases/2007/10/071002213442.htm

GSK's Relenza has to be inhaled, so cannot be administered to intubated, critically severe cases.

Hence, BCRX's Peramivir may play a leading role, as late-stage clinical trials in Japan and the US show positive results when administered intravenously.

HEB

HEB shares dramatically dropped $0.92 to $2.40, giving up all the gains from the past several days. The conference call update on swine flu initiatives worldwide didn't impress investors, as they focused on the delays in FDA approval for Ampligen as a treatment for Chronic Fatigue Syndrome. Days like today are exactly why one should take partial profits on recent large gains, which we did yesterday. As this is all "house" money, I can afford to wait for further developments on either the CFS or swine flu adjuvant front.

BCRX and NVAX share prices were up modestly today after large gains in previous trading sessions, waiting in anticipation of tomorrow's FDA vaccine advisory committee meeting. Both are waiting for pending positive news on Emergency Use Authorization, which will allow them to manufacture doses for the national stockpile. NVAX's VLP technology cuts down the time to manufacture vaccines, which is becoming increasingly urgent as the pending swine flu season is expected in September when schools re-open.

BCRX's Peramivir is not a vaccine, but an anti-viral treatment that reduces the symptoms of the flu and shortens recovery time. EUA is expected for intravenous use in severe cases requiring hospitalization.

Both NVAX and BCRX are working with health officials worldwide, with especially intense clinical activity being performed in Japan and the US.

Swine flu plays resurface ahead of next FDA vaccine meeting

BioCryst Pharmaceuticals (BCRX) gapped up again 22% from yesterday's close of $6.21 to $7.58 today, up 22%, while Hemispherx Biopharmaceuticals surged almost 33% from $2.49 to $3.31. Both are up triple digits since we bought them in May (see June 4, 2009 "Swine flu revisited" blog).

BCRX's Peramivir is an effective intravenous anti-viral against seasonal flu, avian flu, and the latest swine flu (H1N1), shown to reduce flu symptoms in Phase III trials conducted by Japanese partner Shionogi. BCRX is also waiting for Emergency Use Authorization (EUA) by the FDA for severe cases requiring hospitalization. The EUA is required since Peramivir is not approved by the FDA. Peramivir has shown at least equal efficacy against the flu when compared to Roche's Tamiflu anti-viral in clinical trials.

HEB is having a conference call tomorrow to update the investment and medical communities on their clinical developments for Ampligen, a flu adjuvant. Studies have been performed worldwide for use of Ampligen as a booster alongside existing vaccines. Ampligen is also under FDA review for approval as a treatment for Chronic Fatigue Syndrome.

Novavax (NVAX) ended today's session at $3.19, up from $3.02. They also named John Trizzino Senior VP of International and Government alliances, in a sign that they are intensifying efforts with government agencies worldwide on getting approved for their vaccine-line particle (VLP) platform. With VLP, the time to manufacture a vaccine is cut in half--approximately 10-12 weeks, and yields are higher because they don't require egg-based cultures. Fixed costs are also lower due to disposable manufacturing systems.

This Thursday, July 23, the FDA Vaccine and Related Biological Products Advisory Committee will meet with vendors to discuss vaccines against the H1N1 virus: http://www.fda.gov/AdvisoryCommittees/Calendar/ucm170908.htm

This meeting is a sequel to the National Biodefense Science Board (NBSB) meeting held last month (see July 20, 2009 "BCRX potential" blog). The questions held at the NBSB will hopefully be answered this Thursday during the FDA Vaccine AC meeting. Shares of all 3 aforementioned companies jumped in anticipation of positive results.

As mentioned in previous blogs, the World Health Organization (WHO) raised the pandemic alert in June to Phase 6--the highest level possible, which last occurred 41 years ago. The foregone conclusion is that the H1N1 is spreading faster than previous pandemic flus. By the time it hits the US hard in the fall, it is estimated that 1 out of 3 Americans will contract the virus. So far, the mortality rate is lower than the avian flu, but should it mutate, the result strains could increase the severity as well as the virulence.

BCRX potential

According to Health and Human Services (HHS) Dr. Robin Robinson:

http://www.reuters.com/article/healthNews/idUSTRE56669020090709

The federal government has 52 million treatment courses of Tamiflu and Relenza in its strategic national stockpile. Tamiflu, or oseltamivir, is made by Roche under license from Gilead Sciences while Relenza, or zanamivir, is made by Glaxo under license from Australia's Biota Inc.

Dr. Robin Robinson of HHS said the department is also considering buying another tranche of drugs, including zanamivir and pediatric doses of Tamiflu.

A third drug, Biocryst Inc's peramivir, is nearing final trials before approval, Robinson said. "That would be used for severely ill individuals in hospitals," he said.

Having three different drugs would help address the issue of resistance. Some cases of the new H1N1 swine flu have been resistant to Tamiflu and that drug is now generally ineffective against the seasonal version of H1N1, a distant cousin of the pandemic strain.

Also, start reading on page 74 of the following National Biodefense Science Board report during a recent emergency meeting at the HHS regarding H1N1 countermeasures. The fact that BioCryst was at the meeting is a portent:

http://www.hhs.gov/aspr/conferences/nbsb/nbsb-h1n1forum-sum-090617.pdf

Two ships arrive overnight...

BDSI's cancer drug pain-killer finally gained approval yesterday, after an almost year-long delay regarding labeling issues against misuse and abuse. With a novel drug delivery system, along with a strong pipeline, and a low float of shares, this investment in BioDelivery Sciences is a winner.

http://www.reuters.com/article/marketsNews/idINN1643063420090716?rpc=44

BCRX shares shot up overnight, after partner Shionogi announced positive results in Peramivir Phase III trials in Japan and Korea. Peramivir is an anti-viral which competes against existing stockpiles of Roche's Tamiflu and GSK's Relenza. Due to mutation, viral strains are starting to show resistance to Tamiflu and possibly Relenza. Hence, the race to develop a new anti-viral.

We've known of this partnership for a while and the stock has more than tripled since we bought in May, but the shares should soar higher if and when the US assigns Emergency Use Authorization for stockpiling against a pandemic flu.

http://finance.yahoo.com/news/BioCryst-Pharmaceuticals-prnews-4103594572.html?x=0&.v=1