The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Friday Science Review: May 17, 2013

Parkinson’s disease, a neurodegenerative disease characterized by motor and cognitive deficits, may be caused by mutations in the Parkin gene. The Parkin gene transcribes the Parkin protein, an enzyme which has been implicated in cellular processes including autophagy, or “cell housekeeping,” and cell survival. Recent work from the Montreal Neurological Institute and McGill University’s Department of Biochemistry published in Science magazine demonstrates the crystal structure of the Parkin protein. The crystal structure of a protein offers an excellent idea of the natural conformation a protein adopts; determining the structure of Parkin protein, surely an immense amount of work, will allow for advanced studies of how the protein normally functions, and will increase understanding of how mutations in the Parkin protein lead to the deficits seen in Parkinson’s disease.

Parkin protein normally has low basal activity. Following determination of the structure of Parkin, the authors found that it can maintain this low baseline by inhibiting itself. Additionally, by testing a number of mutations in the Parkin protein, they found that most mutations greatly reduce or abolish its already low basal activity. However, mutations directed at eliminating auto-inhibition of Parkin were able to increase activity of the protein, indicating that it is possible to bidirectionally change its activity. These experiments demonstrate the utility of knowing the crystal structure of the Parkin protein, as future studies will be able to better evaluate how the activity of the protein can be managed, which may prove very important in the treatment of Parkinson’s disease.

Monday Deal Review: May 13, 2013

Welcome to your Monday Biotech Deal Review for May 13, 2013! This week saw MethylGene make waves with its announcement that it will move its business to the State of Delaware, and will be held by specially made Mirati Therepeutics.  Mirati will then seek listing on the NASDAQ. It is unclear how long the company will be trading on both the TSX and the NASDAQ together. In other news, iCo has priced an overnight marketing of units for proceeds of about $3.2 million, while Sirona has rasied another $1 milllion, beinging their 2013 total to a healthy $2.4 million.  Click on through to get the rest of the past week’s major biotech news!     Read more of this post

Friday Science Review: May 10, 2013

Stroke is the leading cause of disability in North America, but no good treatment exists for stroke beyond a few hours of its occurrence. The damaging effects of stroke occur because nerve cells in the brain require oxygen to survive; once blood-flow to the brain is disrupted and oxygen delivery to nerve cells stops, the cells enter a state called excitotoxicity and begin to die. The best way to improve stroke outcome is to limit the amount of nerve cell death that occurs. Much pharmacological treatment has been directed at inhibiting a specific neurotransmitter receptor central to excitotoxicity, but this approach can have broad effects within the brain. New research from Dr. Yu Tian Wang’s lab at the University of British Columbia published in the Journal of Neuroscience offers a potential new target to limit nerve cell death following stroke. The researchers found that PTEN, a protein that promotes cell death once it enters the nucleus of a cell, becomes targeted to nerve cell nuclei after excitotoxicity starts; additionally, they found that a specific portion of PTEN is critical for its entry in to the nucleus. In nerve cells that were pharmacologically treated to become excitotoxic, ones that had this portion of PTEN mutated were less likely to die. Furthermore, mice injected with a peptide that inhibits the entry of PTEN in to the cell nucleus experienced less extensive physical brain damage, increased nerve cell protection, and more rapid and complete motor skill recovery following an induced stroke; these effects were seen if the peptide was delivered to mice up to 6 hours after the stroke was induced. These results indicate that limiting nerve cell death through inhibition of a downstream protein involved in excitotoxicity may be a viable new approach for stroke treatment, one which may also extend the treatment window following the occurrence of a stroke.

Valuation and other biotech mysteries – Part 26: Some Final Thoughts

[Ed. This is the twenty-fourth part in Wayne's series. You can access the whole thing by clicking here
As with all commentary on this blog, these comments do not consider the investment objectives, financial situation or particular needs of any particular person, and investors should obtain professional advice based on their own individual circumstances before making any investment decision.]

Wayne Schnarr - seriousIt has now been 35 years since I earned my Ph.D. in chemistry and started wondering how I would make a living and what my career path would be. I sent out over 50 letters to the pharma companies in Canada in 1977 – I got one reply, from Eli Lilly I think – to fill out a form. After 30 years in the pharma/biotech and financial industries, I have had the opportunity over the last few years to sit back and observe those industries, as well as having drinks and chats with many friends who are still working in those industries. Here are a few final thoughts for your consideration.

  • The only constant is change – whether it is disease treatments, the pharmaceutical industry, capital markets or your career paths.
  • The pharma industry is alive and well. Annual global sales of prescription and non-prescription drugs are over $1 trillion and still growing at a higher rate than GDP growth. The U.S. will remain the single largest market at over 30% and Canada will remain at about 2% of the global market.
  • In 2005, the industry spent almost as much on share buybacks plus dividends as it did on R&D.
  • The pharmaceutical industry has historically and will continue to adapt to dramatic scientific, medical, economic and political changes. Just consider a few things which have shaped the industry we see today.
    • Antibiotics from fungal sources
    • Vaccines for polio and smallpox in the 1950s
    • Thalidomide, increased government regulation and the focus on safety in the 1960s
    • Rational drug design
    • The blockbuster era starting about 1980 with the first billion dollar drug Tagamet
    • The U.S. Drug Price Competition and Patent Term Restoration Act of 1984, usually referred to as the Hatch-Waxman Act, and the emergence of generics
    • Biotech equivalents of natural human proteins, including HGH, insulin, G-CSF and EPO
    • The emergence of monoclonal antibodies
    • The biotech boom of 1999-2001
    • Annual drug costs approaching $500,000 annually for certain orphan diseases
    • Restrictive formularies and comparative efficacy analysis by governments and other payers
    • The blockbuster patent cliff
    • ?????
  • M&A is not a new growth strategy for pharma – just look at the list of companies bought by Pfizer over the last 30 years.
  • In the 1980s, the big pharma companies sold off everything that did not look like a blockbuster. Now they are buying back those assets for steady revenue and growth.
  • We could not predict the timing of past biotech booms and we probably cannot predict when the next biotech boom will occur. In my opinion, the biggest boom was just luck – proteomics and genomics came along just as a huge capital pool was exiting the tech boom and looking for an alternative high return investment. Other smaller booms have risen and fallen along with the broader capital markets.
  • The biotech industry had dreams of being different and perhaps better than pharma in terms of development success rates and clinical impact of the products. Its tools were initially different and some independent biotech companies thrived. However, there is really only a single industry with some company differentiation based on therapeutic focus and types of products.
  • The fate of most biotech companies is to fail. Most junior mining companies doing exploration over the last few years have failed to make discoveries which justify building a new mine. It is just a fact of life in these industries.
  • Successful biotech companies will most likely face the ‘acquire or be acquired’ situation. The fate of most successful biotech companies is to be acquired. Investors usually prefer the premium share price that goes with being an acquisition target. Management would naturally prefer to be the acquirer and keep their jobs.
  • Is there an alternative to acquire or be acquired? Is it possible to give 10% of the revenue stream from a licensed drug to the management and let them try to repeat their success, while 90% of the revenue stream is distributed to shareholders?
  • Nobody in pharma or biotech or among their investors can consistently pick winners. Some are more selective in their initial investments and others may exit their losers more quickly.
  • One of the hardest lessons to learn in biotech investing was ‘good companies are not always buys’.

I hope this blog series has been at least interesting and perhaps even useful to its readers by pointing out the many questions which you need to ask.

Friday Science Review: May 3, 2013

The use of oncolytic viruses is becoming an increasingly attractive avenue for the treatment of cancer, because these viruses are able to destroy tumor cells and also generate immune-responses directed at those same tumor cells. Using human viruses for this type of treatment may be inefficacious, because immunity may exist or quickly develop toward the virus that is being used. The use of animal viruses similar to human viruses may prove to be an effective way to avoid these potential immunity problems.

A proportion of cells within a tumor are cancer stem cells, which are often enriched in what is called a “side population” of tumor cells. These cells can self-renew, produce new cells derived from multiple cell lineages, and may increase the growth rate of tumors. Previous research from Dr. Karen Mossman’s lab at the McMaster University Immunology Research Centre demonstrated that bovine herpesvirus type 1 targets transformed human cells but not normal human cells, and new research from her lab published in Cancer Gene Therapy now demonstrates that this virus can infect and kill cancer stem cells within the tumor side population.

The researchers found that exposing a number of different breast cancer cell lines to the bovine herpesvirus 1 led to a decrease in tumor cell viability and an increase in tumor cell death. The virus also killed human breast cancer stem cells, and limited the self-renewal and cellular differentiation capabilities of these cells. Additionally, mice injected with breast cancer stem cells that had been exposed to bovine herpesvirus 1 formed much smaller tumors than mice that were injected with breast cancer stem cells that were untreated. These results offer hope that bovine herpesvirus 1 or similar viruses may be particularly useful in treating cancers, because, in addition to not targeting normal cells, they are effective in killing the particularly harmful cancer stem cell population, and their use could also limit immunity issues that may reduce treatment efficacy.

Valuation and other biotech mysteries – Part 25: Undervalued compared to its peers?

[Ed. This is the twenty-fourth part in Wayne's series. You can access the whole thing by clicking here
As with all commentary on this blog, these comments do not consider the investment objectives, financial situation or particular needs of any particular person, and investors should obtain professional advice based on their own individual circumstances before making any investment decision.]

Wayne Schnarr - seriousAnalyst reports will usually verbally describe a stock as fairly valued, under-valued or over-valued. For profitable companies, this verbal description is usually based on a comparative numerical analysis where the company valuation based on share price is compared to an analysis such as NPV. Analysts do make assumptions in this analysis but they usually start from a solid financial history and also have management’s guidance.

The situation is substantially different for a company at the clinical development stage for a new drug product. The only financial history is the cash burn and any NPV analyses have so many assumptions that the analyses are of questionable absolute value. If there is no useful NPV-based comparator, analysts and CEOs sometimes turn to the valuations of their peers for comparisons.

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Monday Deal Review: April 29, 2013

Welcome to your Monday Biotech Deal Review for April 29, 2013! This week saw Ergoresearch and Amorfix close their previously announced private offerings. Trimel, meanwhile, has raised $40 million from their public offering of 50,000,000 common shares. On the acquisition front, Valeant received approval from Uklraine’s anti-monopoly authority, after extending the deadline for their tender offer for Obagi, which has now closed.  Get the details on these key transactions, as well as the rest of the week’s major news, by clicking through!

 .   Read more of this post

Friday Science Review: April 26, 2013

Inflammatory bowel diseases (IBD), such as Crohn’s disease and ulcerative colitis, are autoimmune disorders in which persistent bowel inflammation leads to physical damage of the intestinal tract. Research out of the Inflammation Research Network at the University of Calgary, and published in the Proceedings of the National Academy of Sciences, offers a cool novel target for the treatment of IBD. Just like we have receptors that signal heat, evident when we get a hot or burning sensation when eating a chili pepper, we also have receptors that signal cold, which can be activated by compounds such as menthol. The researchers found that a receptor that signals cold (TRPM8) is expressed more highly in colon samples from humans with Crohn’s disease than in samples from those that do not have IBD. This finding suggests that the TRPM8 receptor is up-regulated in inflamed tissue in an attempt to cool it, similar to how controlled cooling is used to treat sites of traumatic injury.

To investigate the potential of the TRPM8 receptor as a target for inflammation reduction, the researchers performed experiments in mice in which colitis had been induced. Mice with induced colitis expressed the TRPM8 receptor more highly in their colon than mice that did not have induced colitis. The mice with induced colitis also had high levels of cytokines, signalling molecules that can promote inflammation, in their colon; activating the TRPM8 receptor with a molecule called icilin reduced these cytokine levels to normal. Activation of the TRPM8 receptor in mice with induced colitis also decreased the release of a pro-inflammatory neuropeptide in the gut, and, most importantly, limited the amount of physical damage that occurred to the colon. These findings characterize the TRPM8 receptor as an anti-inflammatory receptor, and highlight its potential as a target for therapeutics directed at reducing inflammation in IBD and other chronic inflammatory diseases.

Valuation and other biotech mysteries – Part 24: Event-Based Trading

[Ed. This is the twenty-fourth part in Wayne's series. You can access the whole thing by clicking here. Please leave comments or questions on the blog and Wayne will address them in future posts in this series. 

As with all commentary on this blog, the opinions expressed herein are the author’s own and are not to be construed as investment advice. The author and his immediate family members may have long or short positions in the shares of some companies mentioned in or assessed during the preparation of this blog and may buy, sell or hold such securities at any time. Past share price performance may not be an indicator of future share price performance. This blog and its contents do not consider the investment objectives, financial situation or particular needs of any particular person. Investors should obtain professional advice based on their own individual circumstances before making an investment decision.]

Wayne Schnarr - seriousEvent-based trading is actually a very common investment strategy. For public companies in many industrial sectors, the key events are the quarterly and annual financial results. The timing of these announcements is regulated (no later than x days after period end) and, if the release date is not announced by the company, investors can approximate the short period within which the financial results will be released. Trading strategies are based on actual and anticipated shorter term share price movement and not necessarily on the longer term prospects for a product or company.

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Monday Deal Review: April 22, 2013

Welcome to your Monday Biotech Deal Review for April 22, 2013! Aeterna Zentaris has had a busy two weeks on the commercial front, signing agreements with Merck and Ergomed.  However, there was a lot more action as well.  Hit the break to catch up on the week’s major biotech news.   Read more of this post

Friday Science Review: April 19, 2013

Author’s note: I will be taking over writing duties from John Holyoake for the Friday Science Review. If you wish to know more about me, you can find my short bio on our contributors page – http://crossborderbiotech.ca/about/
 

Anxiety disorders are becoming increasingly prevalent in our society, and are highly detrimental to an individual’s well being, both physically and mentally. Children with autism spectrum disorder (ASD) are particularly susceptible to anxiety disorders, but their deficits in communication often make it difficult for them to express feelings of anxiousness. Being unable to express these feelings may lead to an exacerbated anxiety response in children with ASD, because they are often exceedingly aware of their surroundings and may become more socially withdrawn. A study published in PLoS One led by Dr. Azadeh Kushki at the Holland Bloorview Kids Rehabilitation Centre in Toronto sought to address this problem by determining a physiological marker that signals anxiety in children with ASD, which would allow for improvement in their care.

Children with ASD and typically developing children performed an anxiety-inducing task while activity of the autonomic nervous system, the part of our nervous system that unconsciously controls visceral functions, was evaluated using three different measures. The researchers found that two of these measures, heart rate and perspiration, were elevated even at rest in children with ASD, whereas the third measure, skin temperature, was comparable at rest between children with ASD and typically developing children. However, during the anxiety-inducing task the skin temperature of children with ASD increased, whereas the skin temperature of typically developing children decreased, the normal response during stress.

The results of this study offer three important findings. First, the observation that heart rate and perspiration are elevated at rest in children with ASD supports previous reports that these children have elevated generalized anxiety. Second, the difference in changes in skin temperature between children with ASD and typically developing children observed during the stressful task offer a potential non-invasive measure of anxiety in children with ASD. Finally, the generalized difference in visceral functions observed between children with ASD and typically developing children indicates that children with ASD experience inappropriate regulation of their autonomic nervous system, specifically over-activity in the division of the autonomic nervous system that controls stress responses. This final finding warrants further investigation in order to understand whether inappropriate regulation of the autonomic nervous system contributes to increased generalized anxiety in children with ASD, or if it simply accompanies general anxiety caused by other characteristics of the disorder.

Positive Share Price Performance in Q1 2013 for the Canadian Healthcare Sector (Part 2)

Wayne Schnarr - seriousIn this blog, I will focus on the Canadian public healthcare companies with share prices on December 31, 2012 between $0.10 and $0.99 (53 companies).

  • Advancers outnumbered decliners by 28 to 25
  • Average and median share price changes were 11% and 0%, respectively
  • No company had a share price decline of more than 40%
  • Eight companies had share price increases of 40% or more
    • Northstar Healthcare (258%) – the share price had been slowly increasing from a bottom reached in November 2012, but no single event could account for the Q1 increase. It was probably a combination of an equity financing, new executive appointments, new surgeons utilizing the surgery center and good Q4 financial results.
    • Stellar Biotechnologies (129%) – the Stellar share price steadily climbed from a November 2012 low. Stellar made preclinical and manufacturing progress with its immune-stimulating protein, KLH, and completed two private placements.
    • SQI Diagnostics (73%) – at the risk of repeating myself, this share price climbed steadily from a December 2012 low. The major product announcement in Q1 was the rapid development of a Multiplex Heparin Immunogenicity Assay with partner Alorithme Pharma. SQI also announced that it had established a special committee to review strategic alternatives.
    • Adherex Technologies (60%) – following its extraordinary Q4 share price performance, based on expectation and then release of preliminary Phase 2 eniluracil data, Adherex announced in Q1 that enrolment was complete and top line data would be released in either Q2 or Q3 2013.
    • CRH Medical (59%) – another company whose share price climbed steadily from a December 2012 low, based probably on expectation and then announcement of increased revenues and profitability.
    • ProMetic Life Sciences (47%) – the ProMetic share price climb started in early October 2012 with the announcement of agreements with Shenzhen Hepalink Pharmaceutical (China), including a substantial equity investment. This investment was completed early in Q1, followed by U.S. FDA approval of Octapharma’s Octaplas (a ProMetic resin is used in its manufacture).
    • Theralase Technologies (46%) – the Theralase share price bottomed in December 2012 and the Q1 increase has been volatile on low trading volume.
    • BioSyent (45%) – this share price has been climbing for almost two years now, probably on increasing sales and profitability.

The first 7 of these companies have moved up from share prices which were not only 2012 lows, but were all-time lows in 5 cases and 30-month lows in the other 2 cases. These companies come from all four of my product / service groupings: therapeutics, diagnostics & devices, services, and other healthcare products & services. The probable triggers for the share price movements include financial results, product data, partnerships and equity financings.

[The opinions expressed herein are the author’s own and are not to be construed as investment advice. The author and his immediate family members may have long or short positions in the shares of some companies mentioned in or assessed during the preparation of this blog and may buy, sell or hold such securities at any time. Past share price performance may not be an indicator of future share price performance. This blog and its contents do not consider the investment objectives, financial situation or particular needs of any particular person. Investors should obtain professional advice based on their own individual circumstances before making an investment decision.]

Positive Share Price Performance in Q1 2013 for the Canadian Healthcare Sector (Part 1)

Wayne Schnarr - seriousIn order to assess share price performance among the Canadian public healthcare companies, I have selected a portfolio of 118 companies for the 2013 assessment. The portfolio has been split into three parts according to the closing share price on December 31, 2012: $1.00 or more (38 companies); $0.10 to $0.99 (53 companies); and less than $0.10 (27 companies).

In this blog, I am going to comment on the Q1 performance of the first group of companies with share prices of $1.00 or more to start 2013 (a subsequent blog will comment on the other two groups of companies in the sector).

• Advancers outnumbered decliners by 24 to 14

• Average and median share price increases were 12% and 3%, respectively

• Six companies had share price increases of 40% or more (3 companies in each of the Therapeutics and Devices & Diagnostics groups)

• Response Biomedical (227%): the share price increase was probably triggered by two new distribution agreements, the first on January 3 with Laboratory Supply Company, Inc. and the second on January 24 with Fisher HealthCare, part of Thermo Fisher Scientific

• Resverlogix (71%): the expectation of data from the Phase 2b ASSURE clinical trial was probably the key trigger for this share price

• TearLab (71%): although listed on the TSX, this company is virtually unknown in Canada and almost all trading occurs on NASDAQ; share price movement in Q1 2013 appears to be a continuation of a product sales-based bounce from a bottom in Q4 2011

• NeoVasc (63%): continued share price momentum also appears to be a key for this stock, which bounced off a September 2011 bottom and, starting September 2011, increasing sales appear to be moving it off a share price plateau

• Cangene (57%): the base for the Q1 movement may have been good financial results reported in December 2012, followed by approval of two products, VARIZIG and BAT, by the U.S. FDA in Q1 2013

• Cipher Pharmaceuticals (41%): Cipher had the largest share price increase in this group in 2012 at 291%; the key event in Q1 2013 was probably the release of 2012 financial results, which showed net income of $2.5 million ($0.10 per share) and a cash balance of $15.8 million at December 31, 2012

• One company had a share price decline of more than 40%

• Trimel Pharmaceuticals (-59%): the decline mostly occurred after the announcement on March 20 of a proposed equity financing

[The opinions expressed herein are the author’s own and are not to be construed as investment advice. The author and his immediate family members may have long or short positions in the shares of some companies mentioned in or assessed during the preparation of this blog and may buy, sell or hold such securities at any time. Past share price performance may not be an indicator of future share price performance. This blog and its contents do not consider the investment objectives, financial situation or particular needs of any particular person. Investors should obtain professional advice based on their own individual circumstances before making an investment decision.]

Monday Deal Review: April 8, 2013

Welcome to your Monday Biotech Deal Review for April 8, 2013! After a hiatus last week due to the holiday, this week we have a lot of activity to cover. Valeant, in particular has been quite busy, being forced to up their bid for Obagi to $24.00 in response to interest from Germany’s Merz Pharma Group. In addition, Valeant’s latest bid is already 70 percent more than Obagi’s average 20-day stock price before the takeover fight began, the highest premium for a U.S. drug-industry deal in four years, according to data compiled by Bloomberg. Further, the Royal Bank fo Canada has said Valeant could be willing to pay as much as $28 a share to top any new offer from Merz, pushing the premium to as high as 99 percent. Valeant has also begun an unrelated note exchange, and has separately engaged a generic manufacturer with a license agreement after Mylan’s regulatory approval of their own anti-viral acyclovir-containing Zovirax® ointment equivalent.

In other news, Stem Cell Therepuetics has signed their merger agreement with Trillium, based on negotiations with Trillium’s debentureholders. There is much more to cover, so follow the break to get up to date on the latest and biggest biotech stories.

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Monday Deal Review: March 25, 2013

Welcome to your Monday Biotech Deal Review for March 25, 2013! This week’s big news was Valeant’s ongoing strategy of using acquisitions to bolster their product portfolio rather than R&D.  Valeant is paying US$19.75 per share of Obagi, which is a skin-care company that is thought to be a leader in the physician dispensed market. Following last year’s acquisition of skin-care maker Medicis, this acquisition is hoped to save $40 million a year for Valeant in cost synergies with tspectralhe new company. Analysts have said that Valeant is paying a little higher than the 2-2.5 times multiple of sales that Valeant has shown a preference to pay, although the cost synergies may be a likely explanation of that.

In other news, IMRIS and Cynapsus have closed private placements, while Trimel has continued their plan of a private placement in conjunction with their major shareholder Eugene Melnyk. Hit the break to catch up on all of the week’s major biotech news!

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Monday Deal Review: March 18, 2013

Welcome to your Monday Biotech Deal Review for March 18, 2013! Another busy week on the investment front saw a number of financings close as well as details provided for ongoing private placements. On the M&A front, Ergoresearch and Victhom have entered into an arrangement whereby Ergoresearch will acquire Victhom. See the details on these transactions and the rest of the week’s major stories by clicking through!

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Monday Deal Review: March 11, 2013

Welcome to your Monday Biotech Deal Review for March 11, 2013! The past week saw significant activity in the investment space, so click through to review a busy week’s worth of biotech news!

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Monday Deal Review: March 4, 2013

Welcome to your Monday Biotech Deal Review for March 4, 2013! The highlights from the past week include Oncolytics’ closing of their$32 million public offering, an update on Paladin’s ongoing share purchase program, and Atrium’s joint venture agreement with Fosum.  Get the details on these and the rest of the week’s major biotech news by clicking through.

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Monday Deal Review: February 25, 2013

Welcome to your Monday Biotech Deal Review for February 25, 2013!

This week saw significant activity on the investment front. Stem Cell Therepeutics and Sirona have each indicated an intention to raise funds through private placements, while Oncolytics Biotech is aggressively hoping to raise $32 million through a public offering. Sernova, Helix BioPharma and Amforfix have each closed their own private placements this week as well. On the M&A front, Cangene has closed their acquisition of the hemophilia compound IB1001, acquiring it through Inspiration Biopharmaceutical’s bankruptcy.

There’s more great stories this week, so click onward to see the whole week’s Deal Review.

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2012 Canadian Healthcare Financings – strong but very selective

Wayne Schnarr - seriousLarge profitable public companies had no problem completing financings, especially those in the seniors housing and long-term care field (the gross proceeds for this category are listed below).

  • Catamaran – $541.8 M (equity)
  • Chartwell Seniors Housing REIT – $339.3 M (equity and convertible debt)
  • Extendicare – $126.5 M (convertible debt)
  • HealthLease Properties REIT – $110.0 M (IPO)
  • Leisureworld Senior Care – $56.4 M (equity)
  • Medical Facilities – $41.8 M (convertible debt)
  • Patheon – $30.0 M (equity)

Some development stage and not yet profitable public companies were able to complete financings over $10 million, a level which allows most of these companies to execute growth strategies and not strictly be in survival mode. The total for these 13 financings was $334.3 million.

  • YM Biosciences – $80.5 M (equity)
  • Novadaq Technologies – $40.3 M (equity)
  • Neptune Bioresources – $34.1 M (equity)
  • Centric Health – $27.50 (convertible debt)
  • Methylgene – $26.1 M (equity)
  • Resverlogix – $25.0 M (debt)
  • Oncolytics Biotech – $21.3 M (equity)
  • Bioniche Life Sciences – $20.0 M (debt)
  • BELLUS Health – $17.3 M (includes plan of arrangement proceeds)
  • Aeterna Zentaris – $16.5 M (equity)
  • Trimel Pharmaceuticals – $13.3 M (equity)
  • TearLab – $12.4 M (equity)
  • Merus Labs – $10.0 M (equity)

A total of $165.2 million was raised through financings less than $10 million each. Some of these financings would have provided only survival funds while some companies with low cash needs may have been able to grow.

The total equity and convertible debt funding raised by development stage companies in 2012 was just slightly lower than in the previous three years, but was almost 60% lower than the 2005-2007 average.

[The data in this post was compiled for the upcoming 2012 Canadian Healthcare Annual Review, co-authored by myself and Ross Marshall, Senior Vice President, The Equicom Group Inc., a wholly-owned subsidiary of TMX Group Inc.]

2012 Canadian Healthcare Share Price Performance – volatile with opportunities

Wayne Schnarr - seriousA group of 96 Canadian healthcare companies, which was assessed for 2012 share price performance is extremely diverse, with market caps ranging from about $1 million to $10 billion, but most less than $100 million.

The 2012 share price performance of the group showed:

  • Median and average share price changes of -11% and +7%, respectively; and
  • Decliners outnumbered gainers by 54 to 42.

In addition, the sector continued to show high volatility, with 46% (44 of 96) of the companies having share price changes of 40% or more. The 19 companies with share price increases of 40% or more are listed below by sector.

Therapeutics:

  • Cipher Pharmaceuticals (291%)
  • Tekmira Pharmaceuticals (223%)
  • iCo Therapeutics (222%)
  • BioSyent (122%)
  • Acasti (87%)
  • YM BioSciences (70%)
  • Lorus Therapeutics (59%)
  • Transition Therapeutics (54%)
  • Microbix Biosystems (46%)

Devices & Diagnostics:

  • TearLab (280%)
  • biOasis Technologies (161%)
  • Novadaq Technologies (76%)
  • Medifocus (50%)
  • Amorfix Life Sciences (41%)

Services Sub-group:

  • Lifebank (191%; acquired)
  • Patheon (161%)
  • Audiotech Healthcare (79%; taken private)
  • Catamaran (63%)

Other Companies Sub-group:

  • Prometic Life Sciences (104%)

 [The data in this post was compiled for the upcoming 2012 Canadian Healthcare Annual Review, co-authored by myself and Ross Marshall, Senior Vice President, The Equicom Group Inc., a wholly-owned subsidiary of TMX Group Inc.]

Monday Deal Review: February 18, 2013

Welcome to your Monday Biotech Deal Review for February 18, 2013! This week saw Gilead finally close its acquisition of YM Biosciences, with YM’s shares now de-listed from trading on the NYSE Amex and the TSX. Shareholders were given $2.65 for each of their common shares during the plan of arrangement.  On the investment front, Innovotech, RepliCel, Lignol, Biosenta and Biosign each had announcements relating to the close or amendment of existing private placements.  Click on to see the full details.

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Friday Science Review: February 15, 2013

John HolyoakeThe Dick lab at the Campbell Family Cancer Research Institute has a prestigious history of unraveling the complexities of cancer and their recent publication in Science adds yet more detail.

Analysis of tumours has revealed that there is immense heterogeneity between patients and also between cancer cells within the same tumour. This heterogeneity is evident at the genetic level, but also in the morphology and behaviours of individual clonal cell lines.

In the research reported in Science, the Dick lab tracked the in vivo propagation of xenotransplanted patient-derived colorectal cancer cells at the resolution of individual clones and demonstrated that cancer cells with the same genetic lineage demonstrate significantly different functional states and notably included clonal cells that were dormant compared to their peers. These populations of dormant cells may be the source of disease recurrence after treatment and therefore determining the mechanism through which the cells enter and sustain their dormant state may open up a new therapeutic strategy to fully eradicate the disease and prevent recurrence.

Monday Deal Review: February 11, 2013

Welcome to your Monday Biotech Deal Review for February 11, 2013! This week saw YM Biosciences obtain the required court approval necessary before their plan of arrangement acquisition by Gilead could proceed. The transaction is essentially free to proceed by the effective date of the agreement. Cangene has acquired a hemophilia compound from the remaining assets of Inspiration Biopharmaceuticals, which is undergoing bankruptcy proceedings. Cangene paid $5.9 million for the compound. Also in the news, Stem Cell Therepuetics will undergo a plan of arrangement with Trillium Therepeutics, where the two companies will effectively be merged and continue to operate under Stem Cell’s name.

Of course, there was considerably more activity this week, so click through to get the full story!

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Monday Deal Review: February 4, 2013

Welcome to your Monday Biotech Deal Review for February 4, 2013! This week saw significant activity in the sector generally  On the M&A side, Valeant continued their ongoing acquisition strategy, buying the Russian Natur Product International, a primarily OTC private pharma company. Gilead’s acquisition of YM Biosciences took one step closer to completion as YM shareholders approved the statorily mandated vote to approve the plan of arrangement that will facilitate the arrangement. Court approval is now required as one of the final steps. Microbix was also involved in the week’s M&A activity, having sold its water for injections business to Irvine Scientific. The there was also significant investment activity this week, including Biosenta announcing a new private placement.

See detail on these and the the rest of the week’s major biotech stories by clicking through!

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Monday Deal Review: January 28, 2013

Welcome to your Monday Biotech Deal Review for January 28, 2013!  The past week was relatively quiet, but highlights include Sernova’s $2 million private placement and Helix’s closing of their $8.5 million sale of the Rivex division.  Click below to get the whole week’s stories!

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Monday Deal Review: January 21, 2013

Welcome to your Monday Biotech Deal Review for January 21, 2013!  Medicago made news last week with a $15 million loan agreement with an unnamed pharmaceutical company. The funds are being used for Medicago’s plant-based VLP vaccine pipeline. As the agreement provides for potential licensing options with that partner, we will be watching closely to see any further announcements.

YM Biosciences, as it continues with its plan of arrangement transaction with Gilead, has received the endorsement of two proxy firms who have recommended to shareholders that they vote in favour of the transaction. This will likely allow YM Biosciences to obtain the shareholder approval required by statute to be able to continue with the arrangement.

Paladin labs, meanwhile, has closed their acquisition of a controlling stake in Ativa Pharma of Mexicom, and has also in-licensed a new biologic from Apeiron Biologics. Also, last week we saw Theratechnologies conclude their recent issues with the NASDAQ exchange by voluntarily delisting. They remain on the TSX, however.

As always, click through to see more on these deals as well as the rest of last week’s major biotech activity.

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Monday Deal Review: January 14, 2013

Welcome to your Monday Biotech Deal Review for January 14, 2013! This week’s big news is that Cytochroma, a privately held company, will be acquired by OPKO Health.  Also on the M&A side, Asia-Biochem completed their acquisition of China’s Tieling Wanshunda Starch Company Ltd for over CDN$44 million. There was not much activity in the investment space, however ProMetric has been able to close $10 million in financing from Shenzhen Hepalink Pharmaceutical Co.,  as we’ve covered previously.  Find out more about these transactions, as well as the rest of this week’s major Canadian Biotech news, by clicking through! Read more of this post

Friday Science Review: January 8, 2013

John HolyoakeUbiquitin-specific proteases (USPs) are implicated in many diseases and yet only a few weak inhibitors of their function have been available. A report in Science from a collaboration led by the Siddhu lab at the Terrence Donnelly Center for Cellular and Biomolecular Research, University of Toronto describes the development of a molecular strategy to inhibit these important enzymes.

The conjugation of ubiquitin to proteins is one of the most common post-translational modifications of proteins. Labeling of these proteins by ubiquitin often functions to target the protein for destruction by the proteasome or to alter the proteins’ sub-cellular localization and activities. The labeling process is itself complex involving the sequential action of enzymes (E1, E2 and E3) and can result in the addition of a single ubiquitin or multiple ubiquitins either as a chain (polyubiquitination) or at multiple sites on the target protein (multiubiquitination). Removal of ubiquitin can rescue a protein from destruction or restore its activity and is carried out by deubiquitination enzymes, of which the ubiquitin-specific proteases (USPs) are the largest class. Members of this class are implicated in multiple disease processes, including cancer and neurodegeneration, making them an attractive area of study, but one that has been hampered by the lack of high affinity inhibitors.

USPs share a conserved ubiquitin binding site structure, albeit with low affinity for ubiquitin, therefore the research led by the Siddhu lab used the strategy of phage-display-based screening of ubiquitin mutants that had increased binding affinity for specific USPs. Using this approach several specific USP inhibiting mutants were created and the researchers were able to build upon this success by expanding the concept to inhibit other deubiquitinating enzyme classes and components of the ubiquitin labelling system – the E2 and E3 enzymes. In vivo activity of this system means the door is open to carry out detailed dissections of the ubiquitin system, along with using the system to validate drug targets, to create screening assays and ultimately to guide the generation of ubiquitin-system target specific inhibitors.

Monday Deal Review: January 7, 2013

Happy New Year and welcome to your Monday Biotech Deal Review for January 7, 2013! While biotech gets back to business for 2013 after the holidays, the last 2 weeks have not seen a flurry of activity.  Nonetheless, on the M&A side, IBEX Technologies acquired Bio-Research Products, while Biosign and Patheon completed private financings of their own.  Further, Warnex has begun trading under the NEX and Stellar Pharmaceuiticals has completed their planned name change to Tribute Pharmaceuitcals.  Get more details on these stories as well as last week’s other major biotech news by clicking through.   Read more of this post

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