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TOPIC: No update DOV ?

No update DOV ? 15 Aug 2015 10:55 #4975

  • myownhedgefund
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I was hoping we would get a spreadsheet update from you.

While I am still positive on the development of scleroderma and OA I severely lowered my estimates for 2020.

I had a "best case" of 153 million falling to the bottom line but now see just 43 million and removed the "best case" fluff along with a few other changes.
Namely:
While I believe the scleroderma market remains the same I have lowered avg. sale est. to 8k per dose. and also lowered the # treated in 2020 for EU and USA.
OA I believe can be massive but still conservative on time to market...Especially elsewhere in the world...also still assume we will be sharing revenues with a partner.
Severely lowered Lorem's contribution in 2020. Same with SUI and burns. Kerastem ? Also not expecting much.
**** NO factor for JK's government CTX2 purchases either which I believe he factors BEFORE 2020 anyway and I give a 10% chance***
Still using either 225 and 240 million as 2020 share counts which translates to $0.18 to $0.19 a share in earnings.
One can apply any PE they want but a PPS range of $4 to $10 seems realistic. Markets can be unrealistic of course so if we (cell therapy) gets in vogue who knows.
BTW...early 2015 when our "analyst" were pumping $6 and $7 PPS projections I said 2015 would remain sub $3 . I think I am safe in lowering that to sub $2 for the remainder of 2015.

Others welcome to add their opinions !!!!!

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No update DOV ? 16 Aug 2015 09:06 #4981

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Hedge,

I have been playing around with the spreadsheet and making similar adjustments downward based on timelines projected by Hedrick. I don't know whether to just go with what he says or try to second guess his timelines. For instance, the SCLERADEC I trial in France treated 2 patients per month per site. Hedrick's comments contained a small amount of optimism that they might be able to do better than treating one patient per quarter per site. This optimism comes as a result of an information blitz through the Scleroderma Foundation starting in September. So there is roughly six months of potential swing in the U.S. timeline. I suppose it will take a year for the FDA to decide whether or not to approve the cell therapy for Scleroderma, but there is upside there as well especially if the Foundation gets vocal.

Hedrick's timeline for the EU pivotal Scleroderma trial was for it to be completed in April/May of 2016. However, he estimated it would take 18 months for the EU to decide whether or not to approve the therapy. To me that seems very slow considering the drug has already been granted orphan status which provides support largely to speed the approval process across the EU member countries.

Hedrick's SUI trial timeline was actually more bullish than what we have been tossing around on this board. Reimbursement perhaps as early as 2018??

The two most bullish comments by Hedrick had to do with the timing of a potential purchase of CTX2 devices by BARDA. I have never included this potential in my numbers, but Jason Kolbert has and he has been projecting this purchase years too early. He now must be clear that 2017 would be the earliest potential and may be why he has lowered his 12 month target to $5 (along with everyone else). The second most bullish discussion was around the early preparation of a draft proposal for a Phase III pivotal trial for OA that could start as early as mid 2016. For that to happen, Jeremy Hayden must be successful in negotiating a partnership that gets signed sometime before the start of the 2nd quarter 2016.

I expect the results to be equal or better than the results from the Czech Republic trial that Fas posted sometime ago. (See below) I have been playing around with various potential partnership structures for OA. In my mind, a good deal for Cytori would include: 1) upfront cash to obtain an exclusive license for all of North America 2) pay 100% of the phase III trial and 3) contain a CTX2 purchase agreement upon hitting the FDA approval milestone.

I am still doing some research on the actual insurance reimbursement for various procedures that could be replaced by our cell therapy (a chondroprotective injection costs $1,700 from the doctor alone), but I can say an extremely conservative estimate would be $2,000 net of COGS for the partner and for Cytori. In 2011, there were 711,000 total knee replacement surgeries in this country. Cell therapy would be done long before the OA progressed to the point of a total joint replacement. It is easy to see how Hedrick has stated this could be a multi-billion dollar opportunity. So what is the appropriate number for upfront cash? What is the appropriate number for CTX2 devices to be sold or given to orthopedic surgeons? That all depends on the results of the ACT trial. This potential partnership could be the validation we have been seeking.

One thing is for sure - With the last patient being treated on June 12th, everyone now knows who got the cells and who got the placebo. That should have been evident within three weeks of the procedure. The first patient is just now hitting their 24 week checkup. It is not surprising Cytori would begin the planning of the Phase III trial this fall.



STROMAL VASCULAR FRACTION CELLS FOR THERAPY OF 275 PATIENTS WITH OSTEOARTHRITIS
Presenter: Jaroslav Michalek, MD, PhD
Authors: Michalek J, Kristkova Z, Skopalik J,
Cibulka M, Holek M, Moster R
Cellthera Ltd
Therapy of osteoarthritis relies on non-steroid analgesics, chondroprotectives and in late stages total joint replacement is considered a standard of care. We performed a pilot study using novel stem cell therapy approach that was performed during one surgical procedure. It relies on abdominal lipoaspiration and processing of connective tissue to stromal vascular fraction (SVF) cells that typically contain relatively large amounts of mesenchymal stromal and stem cells. SVF cells are injected immediately to the target joint or to the connective tissue of the target joint. Since 2011, total of 275 patients have been recruited and followed for up to 24 months to demonstrate the therapeutical potential of freshly isolated SVF cells. At the same time, one to four joints (knees and hips) were injected with SVF cells per patient. A total number of 433 joints were treated. Semiquantitative clinical scale evaluation and non-steroid analgesics dependence was used as measurement of the clinical effect, all patients were diagnosed with stage II-IV osteoarthritis using X-ray and ultrasound, in some cases MRI was also performed to monitor the changes before and after stem cell therapy.

After 3 months from SVF therapy, at least 50% clinical improvement was recognized in 95%, at least 75% clinical improvement in 68%, and complete remission in 54% of patients, respectively. Within 1-2 weeks from SVF therapy 85% of patients were off the non-steroid analgesics and remain such for at least 6 months. No serious side effects, infection or cancer was associated with SVF cell therapy. In conclusion, here we report a novel and promising therapeutical approach that is safe, cost effective, and relying only on autologous cells.

This work was supported in part by the International Consortium for Cell Therapy and Immunotherapy ( www.iccti.eu ) and Czech Ministry of Education Grant No.
The following user(s) said Thank You: d9dozrman, mikeadd@twitter

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No update DOV ? 16 Aug 2015 10:46 #4983

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I look forward to what you have to offer DOV when you are finished your research. :woohoo:

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