Alright Pharma Investors, today were gonna run through the Daily Pharma Watch. In this issue I cover: VION, MYRX, JAV, AEZS, and SQNM
Vion Pharma (VION):
Sadly Vion filed for bankruptcy yesterday. I have mixed feelings about this because yes they have a lot of debt, but at the same time they have a drug (Onrigin) that still needs to get through the Phase III process. I still think management had other alternatives to this, and in my opinion this is the absolute worst case scenario for shareholders because management is hinting at having to sell the drug off. One of the options could have been to issue highly dilutive convertible bonds, heck they could have even issued death spiral bonds as a worst case scenario. True, these bonds would have diluted shareholders badly, but not as bad as what has happened now, because these shares are now going to go to pennystock range. In my opinion management blundered here. See here is the thing, most Pharma companies in my experience have nine lives some have 20 lives if they have good access to capital, unfortunately Vion doesn’t have good access. One of the problems I think Vion faces is the fact that there are 3 other AML drugs vying to get approved and all 3 still have to go through Phase III trials (one of them is Genzyme’s Clolar), so eliminating Vion as a competitor opens up more market share. I will write an expanded post on this later.
Myriad Pharmaceuticals and Javelin Pharma (MYRX):
Another buyout, another day. Myriad said this morning that they will be buying out Javelin Pharmaceuticals for its pain drug Dyloject. I’ve followed JAV for quite sometime now and I think the deal is structured pretty fairly for Myriad shareholders, however not for JAV shareholders. You see, shareholders of JAV don’t like the deal because they didn’t get nearly the 30-40% premium that Pharma investors usually get for holding a developmental stock. Not only that, but JAV shareholders get paid out in MYRX stock, which oh by the way is down a WHOPPING 7% this morning. JAV is up some 10% on the news.
AEterna Zentaris (AEZS):
No big surprise this morning when AEterna Zentaris announced that Sanofi Aventis canceled their agreement for cetrorelix for prostatic hyperplasia after the drug failed Phase III clinical trials a week ago. Cont’d on next page
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