MEI Pharma Inc. buy DomRuinart

Sell off übertrieben?

Klar, die Studienergebnisse waren ein Desaster. Aber 70% Wertverlust halte ich für stark überzogen. Die haben jetzt eine Marktkapitalisierung von 65 Mio $ bei einem Cash-Bestand von 78 Mio $. Wie unten beschrieben, ist Pracinostat noch längst nicht tot. Dazu haben sie mit ME-344 (Phase Ib,) und PWT 143 (Start klinische Test für erstes Halbjahr 2015 angekündigt) noch weitere vielversprechende Produkte in der Pipeline und die entsprechenden „intellectual property“ mit Patenten bis ins Jahr 2028. Selbst wenn ich die Pipeline und die Patente mit nur sehr konservativen 20 Mio $ Bewerte, komme ich auf einen fairen Wert von 3,-$ pro Aktie. Mit dem zu erwartenden News-Flow zu ME-344, PWT 143 und auch Pracinostat halte ich einen ordentlichen Rebound für wahrscheinlich. Ich glaube hier kann man einen kleinen Zock wagen.

MEI Pharma: Upcoming Catalysts Will Drive Stock Rebound

Mar. 24, 2015 10:51 AM ET | About: MEI Pharma, Inc. (MEIP)by: Stock Doctor

Disclosure: The author is long MEIP. (More...)The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it. The author has no business relationship with any company whose stock is mentioned in this article.

Summary

• Secondary endpoints such as overall response rate, progression free survival, leukemic transformation, duration of response need to be analyzed before writing off Pracinostat in front-line MDS.
• Pracinostat efficacy in AML has higher chance of success than MDS due to more advanced disease state and ability to cause complete remission as single agent.
• Several shots on goal with several other Pracinostat indications and 2 other drugs in pipeline.
• Sell off overdone and now selling for less than cash.

Those that follow my biotech investing strategies know I like buying undervalued stocks with good preliminary data heading into specific catalysts. These stocks many times will increase at least 50% as data release approaches. It is always good to ring the cash register when significant gains accrue for small cap biotech stocks as disappointing results will send the stock tumbling. This is especially true, if the upcoming catalyst is not the main reason one is holding the stock. I was able to lock in gains before Cytokinetics (NASDAQ:CYTK) released their ALS data that sent the stock tumbling. As anticipated, in the weeks leading up to the Pracinostat myelodysplastic syndrome (MDS) Phase II results investors drove the stock price up as analysts urged everyone to buy the stock. The ~80% gain in MEI Pharma (NASDAQ:MEIP) in less than 2 months since my article was too much for me to pass up completely as I hedged my bet. Yesterday, MEI Pharma released top-line data from a randomized Phase II study comparing Pracinostat in combination with Azacitidine in treatment naïve intermediate-2 or high-risk MDS patients. The data did not meet the primary endpoint of the number of complete responses. Due to the results, the stock plummeted ~70%, bringing the stock's market cap down almost $15M below their cash on hand to $65M. I've been getting a ton of emails asking my opinion on the stock after the data release. With Pracinostat being tested in numerous indications and other drugs in the pipeline I can assure you the drop is way overdone and I fully anticipate a big upcoming rebound. I am back in following the decline and will await the run-up to the Acute Myeloid Leukemia (AML) Phase II results expected in June.

Don't Give Up On Pracinostat in Front-line MDS Quite Yet

Investors, including myself, were obviously excited about the pilot data showing the effectiveness of the HDAC inhibitor Pracinostat in MDS. The FDA approved hypomethylation agent Azacitidine had achieved a clinical response rate of only 16% by itself in Phase III trials. However, the pilot study conducted at MD Anderson treating MDS patients with a combination of Pracinostat and Azacitidine achieved a complete response rate of 90% (9/10 patients). Therefore, for good reason, I was surprised by the top-line data released yesterday stating that Pracinostat was no more effective in inducing complete responses when combined with Azacitidine than Azacitidine alone. Management picked complete response as the primary endpoint considering the huge response rate observed in the pilot study. However, since Pracinostat is being tested in combination with Azacitidine anyways, I believe the most valuable data will be found in the secondary end-points and may provide a lifeline for Pracinostat in front-line MDS.

It has been noted numerous times by Dr. Garcia-Manero of MD Anderson that the responses seen with the combo treatment were deep responses. It is possible that the overall response rate, the duration of response, progression free survival or rate of AML transformation is affected positively. Investors always want examples in which this is true. How can a drug improve these secondary endpoints but not have a significant impact on response rate? Novartis (NYSE:NVS) recently received FDA approval for its HDAC inhibitor Farydak in multiple myeloma patients who had received two prior treatment regimens. The overall response rate in the study was not statistically significant although there was a progression free survival advantage of 3.9 months resulting in approval…

Quelle: Seeking Alpha