Sunday, March 30, 2008

Finally the Titan is Rising (TTP)

Titan Pharmaceuticals (TTP) has been a favorite of mine for at least a couple of years, and while taking the chances to sell on the spikes and buy on the dips, I haven’t done too bad with this one.

However, the initial reason I purchased shares of TTP is the same reason why I bought into Epicept (EPCT): Risk vs Reward. I like getting into the biotech stocks that have more than one drug in the pipeline, providing a fall-back option if one drug doesn’t pan out.

Take Genitope (GTOP), for an example. Genitope is what they call a one-trick pony and their one trick, the cancer vaccine MyVax, did not meet the primary goals of it’s Phase III trial. The vaccine worked on a subset of patients, but that was not good enough to pass FDA muster, so the GTOP stock that traded at $4.03 on December 20th is currently trading at $.27. That’s cents. That’s the risk of biotech and that’s the risk of one-trick ponies.

Biotechs that offer more than one trick, such as Accentia Biopharmaceuticals (ABPI) can survive initial poor results for one drug, in their case Sinuphase, and then rebound because they have more to offer. After dropping from about three dollars to a low of $.65 cents, Accentia now trades at about $1.30, while we await trial results for BiovaxID. Biovax Phase III results will be unblended any time now by Biovest (BVTI.OB), a majority-owned subsidiary of Accentia. If you bought ABPI in the $2-$3 dollar range, the drop and rebound may not be enough to offset your loss, but you’re not in the hurt locker as bad as you would have been if Accentia did not have a second trick to fall back on. AND, if you bought at the low, or near it, you’ve already doubled your money and maybe equaled out what you lost as the stock dropped on the poor results. That’s the benefit of having a more-than-one-trick pony. You get a chance to recoup your losses.

That’s what Titan Pharmaceuticals gives us, a pony with multiple tricks. The first trick is Iloperidone, and right now we’re waiting on the FDA and whether or not they will approve the drug that Titan licensed to Vanda Pharmaceuticals (VNDA). The FDA has July 27th as the decision date for Vanda’s Schizophrenia drug, and if approved, Titan is due 10% royalties for a time.

The Street doesn’t give Iloperidone too good a chance at approval, as Vanda’s heavily-shorted stock has dropped from a high of over 30 bucks to a low of two dollars plus. Vanda is inching back up, now trading in the mid-four range. For Titan, Iloperidone’s approval would be a bonus.

Titan has Phase III results for Probuphine, a treatment for opiate addiction, to be released in 3rd Quarter this year and Phase IIb results for Spheramine, an advanced Parkinson’s drug who they’ve partnered with Bayer-Schering, also due to be released in Q3. These two events each have the potential to double the price of the stock.

With these three events due this year, the risk-reward for TTP is too compelling.

On the backburner, Titan has DITPA and Gallium Maltotate, but neither deserves to be priced into the stock at any point in the near future, but they do offer down-the-road potential.

Titan traded for under a dollar for a while recently, and hopefully the smart ones were loading up at that price. Titan trading for under a dollar is as ridiculous to me and Epicept trading for fifty cents. Sometimes risk vs reward jumps out at you and slaps you in the face, and that’s what TTP is doing right now.

For the first time in years a new analyst has jumped aboard the Titan express and initiated coverage. Canaccord Adams intiated with a BUY rating on the company Wednesday and the stock is up roughly 30% since. This should be the beginning of good things if you’re into TTP.

The upcoming study results and Iloperidone’s possible approval should help get this one inching higher, before a nice spike on any positive news coming from these events.

Again, VFC loves risk vs reward, and today that spells TTP.

Thursday, March 27, 2008

Epicept (EPCT) Risk-Reward Here is Ridiculous

Watching EPCT trade in the mid $.50s is ridiculous. Granted, many investors/traders bailed out when the CHMP, the scientific division of the EMEA released their negative trend vote recently, and a negative opinion regarding marketing Ceplene in Europe. Ceplene is Epicept’s oncology compound that treats the maintenance of remission in patients with Acute Myeloid Leukemia (AML).

The CHMP indicated that they believe more data is needed to support the Phase III clinical trails of the drug.

The price of Epicepts stock, EPCT, dropped to well below a dollar on the EMEA news. As I stated in previous posts, I thought the risk-reward was good then, but now, when we’re sitting at half a dollar per share, the risk-reward is great.

Aside from Ceplene, the company has five drugs in the pipeline, including Azixa, a treatment for brain cancer, with Phase II trials being conducted by Myriad Genetics, Inc. Positive indications of from these trials drove the share price to over four dollars for a short period last year.

One more cancer drug in Epicept’s pipeline is EPC2407, currently in Phase I trials to treat solid tumors.

Besides the the solid oncology pipeline, Epicept is currently testing three drugs treating acute and chronic pain. NP-1 is currently in Phase III trials and the other two, Lidopain SP and Lidopain BP both in Phase II.

The bottom line, as I’ve mentioned before, is that the risk-reward for EPCT is unbelievable, and VFC loves risk-reward. Six drugs in the pipeline and the company is trading mid $.50s.

Granted, the traders are a little more impatient than me and go looking for the quick buck, and granted all biotech is risky, but I’ve got the patience to wait this one out.

At this price, EPCT is reminding me of ENCY. Encycive’s stock got knocked down to about 50 cents last year after a third approvable letter from the FDA for the company’s Thelin application, but just recently got bought out by Pfizer for $2.32 per share.

Hopefully the game is not the same here, as VFC believes this company has way more of an upside that what a buyout would give the shareholder now.

With the ability to take a good risk chance here at this price, you could always sell on any positive news and double, if not triple your money in a short time.

I’m buying some more EPCT on the risk-reward alone, and as always, with the hope that any newly approved compound helps those that need it.

Sunday, March 9, 2008

CSUH.OB, Nice Buying Point, and More International Distribution

CSUH.OB has hit the point where VFC is buying again. I love this low teens range as the risk-reward is just too good.

On another note, the Celsius Holdings latest Press Release detailed an agreement with Jorge Hane, an internationally known weight loss guru, who will market and distribute the product worldwide. Hane has international distribution already in place and he has agreed to become a spokesperson for the company and it’s fantastic product. Hane is the president and CEO of Premier Solutions, a Miami based company, and has product sales in 77 countries world-wide. Hane plans to open up weight loss clinics around the world and, being a spokesman for the company, this will substantially increase Celsius’ product recognition. This should give a nice boost to the bottom line.

Hane reportedly tested the product with up to 40 international distributors to positive reviews.

The fact that such a well known weight-loss personality is willing to pitch a product gives instant credibility to a product that sells itself once it’s discovered. As I’ve mentioned in previous posts, deals like these are the reason why the scientific studies become necessary, and these scientific studies are beginning to pay off in a big way. You don’t see Jorge pumping Enviga, but that could also be because it’s an inferior product.

The way I see it, this is a great price to double down.
Again, I like the product, the management, and deals like this.

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