Tuesday, May 10, 2011

EPCT: Not Out Of The Woods Yet, But The Long Term Potential Shaping Up

So far Epicept's claim to fame has been receiving an approval for the AML treatment Ceplene in Europe and in Israel.

Although sales for the product were "not material", according to the most recent quarterly announcement, Ceplene is partnered with Meda AB in Europe and with MegaPharm in Israel.  The company does not expect to see significant sales growth from this product until next year, when the reimbursement and approval authorizations are finalized in the individual countries of the EU and the commercial launch in Israel is in full effect.

In the meantime, Epicept has taken a step forward towards approval in the United States. 

The company announced on Monday that it had filed the Phase III protocol with the FDA, and expects to receive initial comments from the regulators within 45 days.  Once the final protocol is established, then the Phase III trial can commence, but it's not likely that we'll see that until at least late this year.

Epicept has already been granted an Orphan Drug designation in the US, giving the company seven years of exclusivity on the market, once (if) approved.

Another milestone to watch for Ceplene will be the release of interim results from the post-approval trial taking place in Europe.  These interim results are due out later this year.

The rest of the pipeline is also shaping up, and may hold even more potential than Ceplene.

After announcing positive Phase IIb results for the topical pain creme NP-1, now known as AmiKet, Epicept is looking to partner the product to bring it through Phase III and to commercialization.  According to this week's earnings announcement, partnership talks are in the works.  I will note, however, that it took some time for Epicept to partner and commercialize Ceplene, so history says that investors could be waiting a while before seeing an AmiKet partner.

The next two product candidates may hold the most future value.

A Phase II trial for Crolibulin was initiated last year by the National Cancer Institute (NCI) as a treatment for anaplastic thyroid cancer (ATC).  Results from this trial could start rolling in as early as late 2011.

Azixa is currently being tested in Phase II trials for glioblastoma multiforme (GBM) in coordination with licensing partner Myrexis, with some data from this trial possibly being released within the next couple of months.  EPCT has moved significantly in the past on positive Azixa news (although the moves were short-lived), and should this product move to Phase III, the case for EPCT as a nice long term pick becomes a little more legitimized. 

Additionally, Epicept will receive a milestone payment from Myrexis upon the first patient dosing in Phase III.

The pipeline looks solid, but the financing - not so much.

As has been the case in the past, dilutive financing events should be expected, pending any significant income from partnership deals.  I wouldn't hold my breath waiting for the big partnerships, however,

Another reverse stock split is also not out of the question.

That said, EPCT is still a decent, but speculative, 'buy the dips' kind of play.

With a few trial milestones due this year, it'll be one to keep an eye on.

Disclosure:  Long EPCT.


1 comment:

  1. Can anyone explain that epct.. What is that purpose.. Thanks for this..


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