“This Tiny, Unknown Biotech is About to Unleash Its ‘Holy Grail’ Drug”

Biotech Supertrader teases that "This May be the Most Radical Advance in Medicine in the Last 100 Years"

By Travis Johnson, Stock Gumshoe, January 8, 2014

Robert Morris is helming a biotech-focused stock newsletter that’s called Biotech Supertrader (modesty has no place in the world of newsletter promotions, of course), and I’ve never covered this letter before so I thought I ought to have a look at the latest teaser we’ve been asked about.

Morris, incidentally, has been featured in our pages before — but that was back when he was editor of China Stock Insider at the same publisher. That letter, like almost all China-focused investment newsletters, seems to have disappeared quietly into that good night … which probably tells you that it’s time to invest in China again, since the newsletter publishers are ignoring the Middle Kingdom and rushing out their pitches about biotech and tech stocks. At the time, Morris was teasing NQ Mobile (NQ), which has turned out to be pretty good if you bought it down there in the $6-8 neighborhood (though it’s been a wild ride).

So now what’s he pitching for his Biotech Supertrader?

Well, the destruction of “Man’s deadliest disease”, of course. Here’s how the teaser gets our attention:

“This Tiny, Unknown Biotech is About to Unleash Its ‘Holy Grail’ Drug on Man’s Deadliest Disease

“Their ‘Guided Missile Approach’ Could Save Thousands of Lives Each Year

“It’s about to become the most talked about advancement in cancer treatment in our lifetimes and you can lock in a life-transforming fortune if you act quickly….

“I’m urging my subscribers to load up on this stock NOW….

“I’ve just uncovered a tiny, unknown biotechnology company with a new cancer drug in phase 3 clinical trials which is showing remarkable success at treating several types of cancer.

“Their scientists have found an innovative approach to cancer care which involves a breakthrough in treatment. It goes deep inside the inner workings of our cells.

“Plus, this medicine looks to be many times more effective and with fewer side effects than the chemo, radiation, and drug therapies currently available.”

If there’s one thing that investors know can make them rich and make them feel good about themselves and the world, it’s a cure for cancer — we’ve seen that effective cancer treatments can and do (occasionally) turn little biotech stocks into gigantic successes, so the dream lives on that you’re going to catch one of these lottery tickets and own the next Genentech. Will we be so lucky? Well, let’s see which one he’s pitching:

“When this drug wins FDA approval – which I believe it will – this small company’s $4.16 stock price will go straight to the moon.

“And the market for this drug is absolutely huge!

“You see, this small biotech is targeting its new drug, let’s call it ‘drug S’, at cancers of the blood and bone marrow. And it is already in very promising phase 3 trials for these two types of cancer.

“But here’s where it gets really interesting. It looks like the drug this company is developing will also work on other types of cancer!

“There are positive signs it works on Non-Small Cell Lung Cancer (NSCLC) too. There are 1.1 million people with this type of malignancy. Just in the United States alone there are over 300,000 patients with this disease according to The American Cancer Society. Each desperate for a cure.

“Plus it looks like ‘drug S’ may turn out to be an effective treatment for ovarian Cancer. There are more than 204,000 new cases of ovarian cancer diagnosed worldwide each year with 22,280 of these in the United States according to the National Cancer Institute estimates.”

So … who is it? Thinkolator sez this is Cyclacel Pharmaceuticals (CYCC)

Cyclacel is indeed a little biotech around $4 (it closed at $4.35 yesterday), with a market capitalization of only about $80 million — so be careful, we’re a big enough group here that if just a small percentage of Stock Gumshoe readers got enthused about this stock it could drive the shares up, less than a million dollars worth of shares trade each day (Biotech Supertrader says they limited their readership to 750 people — I don’t know if that’s still their cap or if they’ve hit it, but we’ll have more folks than that reading this free article).

And like many biotech stocks, it’s got some impressive scientists and it’s been losing money for a long time as they’ve been searching for a viable drug (their current lead drug also was a big focus of theirs back when it was in Phase 1 trials five or more years ago, so that’s a good reminder of the time these things take, it’s just starting Phase 3 trials now). It looks like they must have gone public in 2004, when they were about eight years old, and a quick scan of ten years of their financials over at Morningstar indicates that they’ve never generated more than a token amount of revenue (meaning, they’ve probably had some research collaboration payments or partnership funding, but never got a product to market), and have accumulated more than $250 million in losses to date. And had two reverse splits to keep the price from sinking far into penny territory.

So that’s not unusual, but it means that — as with all developmental-stage biotechs — it’s not about the financials or the fundamentals, it’s about what’s going to happen in their clinical trials and whether things are going well enough that they can continue to finance the trials … which get much more expensive as you progress through Phase 2 and Phase 3.

All I know about them so far is that they say they’ve got enough cash to get through enrollment in their key Phase 3 study for “drug S” (which is sapacitabine) as of September when they last updated their investor presentation, but I know nothing about the science or the competing cancer drugs that are out there or how fabulous this particular one might be, so I asked our favorite medical writer, Doc Gumshoe (who, yes, is not a doctor) to check them out quickly and chime in. Here’s what he could share after looking into them for a few minutes (he’s just looking at the medical stuff, not so much the “investor presentations”):

    Cyclacel’s Prospects

    Cyclacel has three drugs in development at this time, and is involved in eight clinical trials with these drugs, not including two clinical trials that have been terminated. Their top contender is sapacitabine which targets the division of cancer cells. If you can prevent cancer cells from dividing and reproducing, you have the cancer whipped, so targeting cancer cell division (or mitosis, which is the technical term) is a highly promising avenue for treating cancer. However, we need to take note of the fact that sapacitabine is one of a large number of drugs that propose to fight cancer by this method.

    At present, all eight of Cyclacel’s clinical trials involve sapacitabine. Of these, at least one has been completed – a Phase 1 study of the safety and pharmacology of the drug. Four others are current, with no information about results. These are likely Phase 1 or small Phase 2 studies, to assess safety, determine what a correct dose might be, and evaluate whether the drug does what it’s supposed to do in human subjects with the target diseases, which in this case include acute myeloid leukemia (AML), cutaneous T-cell lymphoma, and some advanced solid tumors. Prior to the clinical trials, sapacitabine has demonstrated impressive results in delaying the spread of metastatic liver cancers in mice.

    From what I can gather from public sources (i.e., the NIH Clinical Trials Registry), there is one Phase 3 trial, which started recruiting patients in February of 2013 and is expected to be completed in late 2015. The trial is in elderly patients with AML, and compares alternating cycles of sapacitabine and decitabine with decitabine alone. Decitabine (Dacogen) is FDA-approved for treating AML and also targets cancer cells’ replication by attacking their DNA.

    It is possible that the Phase 3 trial by itself could lead to FDA approval for sapacitabine, depending on the strength of the results. However, that trial would not get the drug approved for use as monotherapy, since it is not being investigated as monotherapy. My guess is that Cyclacel is planning more trials of sapacitabine as monotherapy, perhaps in younger patients. And my further guess is that FDA approval is still quite a long way off.

    Sapacitabine is also in a Phase 3 trial with cyclophosphamide and rituximab for the treatment of relapsed chronic lymphocytic leukemia. Cyclophosphamide (marketed under several trade names) is a well-established chemotherapy agent used in a number of cancers, and has led to remission in many cases; however, it is associated with truly harrowing adverse effects. Rituximab (Rituxan, Genentech) is used not only in cancers but in some autoimmune diseases. And sapacitabine is also being studied in patients with previously-treated non-small-cell lung cancers.

    Although the piece from Biotech Supertrader said that the drug – identified as “drug S” –is also a promising treatment for ovarian cancer, I find no clue that it is being studied in such patients. [ed note: that’s because that “promise” is in the lab still, not in people — they had a press release about this in the Fall, “75% of Ovarian Cancer Patient Samples Highly Sensitive to Sapacitabine”, not studied in patients but on patient samples]

    Cyclacel has two other drugs in development: selicilib and a drug designated as CYC116. One selicilib study has been terminated, and in a second Phase 1 study, selicilib is used with sapacitabine in patients with advanced solid tumors. Remember, however, that Phase 1 studies are many rungs of the ladder below what’s needed to gain FDA approval.

    CYC116 is an aurora kinase inhibitor, meaning that it blocks the action of an intracellular enzyme that facilitates cancer cell mitosis. This is a promising avenue of cancer treatment, however, the traffic on this avenue is fairly heavy, and includes several other classes of drugs including tyrosine kinase inhibitors, and taxol based agents such as paclitaxel (Taxol, Bristol Myers Squibb); docetaxel (Taxotere, Sanofi-Aventis), Abraxane (a newer formulation of paclitaxel from Celgene) and others.

    CYC116 supposedly also inhibits vascular endothelial growth factor (VEGF), which induces the growth of blood vessels that nourish cancer cells. Inhibiting VEGF is a well-established means of combating cancer, and CYC116 could hardly be characterized as a radically new departure in cancer treatment.

    The one trial involving this agent has been terminated. That, of course, does not mean that development of CYC116 stops dead in its tracks – there are many reasons why a trial can be terminated, and ours is not to speculate without more information.

    Beyond those three drugs, it’s hard to guess what Cyclacel may have up its corporate sleeve. It is certainly true that a successful cancer drug – even if only moderately successful– can be transformational for the biotech that develops the drug. But the drugs that Cyclacel has under development do not appear to this skeptical observer to be radically new departures in cancer treatment.

    It’s important to remember, when trying to estimate the likelihood of a single drug demonstrating sufficient efficacy and safety to gain FDA approval and market share, that the competitive field is vast. As I mentioned earlier, Cyclacel has a total of 8 clinical trials in process at this time.

    For the sake of perspective, it’s worth knowing that at present there are 41,445 cancer trials being conducted. So those are the odds.

So there you have it — it’s almost impossible to find a development-stage biotech whose financials look great or that makes your heart go pit-a-pat over their valuation, especially in a biotech bull market like we’ve seen over the past year or so, and Cyclacel doesn’t jump out as spectacular on that front either, not unless you’re a big believer in the promise of their specific drug. They’re a small stock and they don’t get much attention, other than from the analysts who probably helped them sell shares in secondary offerings in recent years, and there aren’t any major “skin in the game” insiders as far as I can tell (the CEO owns $1 million worth of shares, but he gets paid more than that every year), and there’s only one really focused owner on the institutional side that seems to have any kind of biotech focus (Eastern Capital owns about 7% of the shares, roughly $5 million worth … don’t know much about them).

So I don’t see a lot to make them stand out other than Robert Morris’ apparent enthusiasm for the shares (which certainly goes over the top, he calls his special report “The End of Cancer Worries Forever“), and I don’t know enough about the science to be a believer (though, to be fair, I almost never speculate on developmental biotechs because they’re so hit-driven and I’m not smart enough to be a hit-picker in the sector). It is at least encouraging that they are enrolling patients for Phase 3, and that they probably won’t have to raise more money before they have some indication of how the trial is going, but sometime in the next year or two they’re probably going to have to either get good results from this trial that let them raise cash at a good price, or have promising enough results that some big pharma company wants to jump in and help fund development of “drug S” (or just buy up the whole company, as happens with some regularity when a little biotech gets promising results).

Oh, and they are presenting at an investor conference next week, so maybe they’ll have something interesting to share then. As you can tell, this one doesn’t jump into my cup of tea … but these kinds of stocks almost never do. Sound interesting to you? Interested in the science or the lottery-ticket possibilities of $80-million developmental biotechs? Have any experience with Robert Morris or know whether or not we should consider him a biotech savant? Let us know with a comment below.


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2685 Comments on "“This Tiny, Unknown Biotech is About to Unleash Its ‘Holy Grail’ Drug”"

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terje
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Lou L
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Jo McIntyre
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Well, I guess that’s it then. Goodby all – I’ll try to find you on the other threads. This has been a great ride in so many ways. Thanks to all of you who contributed so much to our medical and investment knowledge, including, of course, Dr. KSS!

Dr KSS MD PhD (former columnist)
Member
47632
to HarleyDLS; Thanks for writing. The ill effects from interferon and ribavirin can be quite bad. But it is impossible to be healthy and have HCV and I feel the NIH’s stance is very much in error. Even without cirrhosis, HCV patients have 12 times the death rate of the uninfected. HCV clearly directly causes non-Hodgkin B-cell lymphoma. A third of patients with it develop essential mixed cryoglobulinemia. Nearly all patients with it have depression because serotonin metabolites are found to be low in CSF. A host of other complications arise from it as well, such as PCT and Mooren… Read more »
LongOnLife
Irregular
667
Hi Dr. KSS, Many thanks for your response. You are correct in your assumptions that I have genotype 1a. I have not had a biopsy in about 8 – 9 years, but the last one showed no fibrosis and only mild steatosis. I am not cirrhotic and most of the symptoms I suffer are depression, itchyness, insomnia, and fatigue. I am unsure why they started the ultrasounds but that routine started after I failed to complete the Int-Rib-Incivek combination therapy in Oct. 2012. So far, all the ultrasounds have shown is a couple of cysts that the PA described to… Read more »
backoffice
Irregular
195

Dr.KSS,
I was HepC positive 1A for over 10 years and non-responsive to ribavarin and interferon and suffered many side effects such as peripheral neuropathy, PCT, and vascular problems to both legs and feet along with other problems. I took Olysio and Solvaldi and was undetectable after 14 days and have remained that way since last April. If I can provide any info please e-mail me at Extet@aol.com

Dr KSS MD PhD (former columnist)
Member
47632

Wow, sounds like you had cryoglobulinemia Gary, which could have killed your kidneys, but should now be gone. I am happy you are cured. PCT is truly hellish, as you know, and is also a way that infected people also spread virus. I hope all your suffering is over, Gary, and that you are all-around well. I know you got body-slammed by the failed PEG-IFN-alpha/RBV course. Thanks for writing in.

dcohn
Irregular
172

Hey Doc

I also am IA HCV positive since late 70s detected in the 90s.
I finally took the recent test for the new drugs and United health denied me because of no Cirrhosis of the liver and that I am not showing signs of illness.
That is so wrong.

Subramania Kaushik
Irregular
673

For those in this thread, check out this new presentation of Benitec!

http://www.asx.com.au/asxpdf/20140314/pdf/42ncrnjb8ys5p0.pdf

jennawade
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Beni guys?

omcdac1
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Dr Kss, We never talk about Microlin Bio http://www.microlinbio.com/ they are using microRNA. Any thought on this. Is this good tech/company to buy ? Soon it will be public i think.
Thanks alot 🙂

jer_vic
Irregular
338
coffee
Irregular
2

Navigation is becoming a problem for me, could someone put up some links to the threads/blogs/articles that are replacing this one please.

Regards.

coffee
Irregular
2

Bizarre coincidence, a strange date order of posts here, but found my request now follows a post with the answer to my question. A good coincidence!

Thanks.

Brandon
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Some posts ago, I mentioned having done some DD into ISR, IsoRay, and found their technology quite sound. Unfortunately, there was not much follow up enthusiasm. Well, I was able to get in at 1.1 and sold at 3.5 yesterday…just to show there are still some undiscovered gems around…now my next target is ELTP. It has a proprietary technology on abuse deterrent pain medicine. Stay tuned…

jennawade
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wow, how did you know when to get out?

Brandon
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(re-post) Some posts ago, I mentioned having done some DD into ISR, IsoRay, and found their technology quite sound. Unfortunately, there was not much follow up enthusiasm. Well, I was able to get in at 1.1 and sold at 3.5 yesterday…just to show there are still some undiscovered gems around…now my next target is ELTP. It has a proprietary technology on abuse deterrent pain medicine. Stay tuned…

Brandon
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Why does my post of March 21 jumped to #312, which is before March 7 post? Strange…

--MJ
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Travis moved some posts to another thread and now new posts are filling in the gap(s).

tanglewood
Irregular
211

Brandon, MJ, John Pillinger please see jer-vic reply at #308 (#1308). This thread is virtually inactive now and has been split into two, one requires a $49. membership (irregulars) and the other is free.

Dr KSS MD PhD (former columnist)
Member
47632

One born every minute Scott Postma. Good luck! (You’ll need it.) I know things about this company you clearly don’t, and if you want to join us on the irregulars, and also not be ad hominem, I will be happy to speak with you. But here I have nothing more to say to you. Life is too short to remediate the foolish and tutor the willfully naive.

srpostma11
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Let me explain the reason for my comment. I am new to the different biotech message boards. I have browsed Yahoo message boards, investors hub message boards and now stock gumshoe message boards. Yahoo message boards clearly has the least credible posts on it. When I saw your comment about doctors not want to use multikine with even with FDA approval, my mind went to the Yahoo-type message board post. I can see that you are well educated and of course the doctor. Could you please explain to me the rationale as to why doctors would not use multikine even… Read more »
Alan Harris
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If anyone is missing us, pay your $49pa (cummon 5 cups of coffee at starbucks costs that and only lasts a lunchtime) and visit http://www.stockgumshoe.com/2014/03/microblog-nash-an-all-too-common-liver-disease-and-a-company-aiming-to-treat-it/#comments
or
http://www.stockgumshoe.com/2014/02/microblog-the-eyes-and-ears-team-for-bio-trials/#comments
Dont forget to click Notify me.
C’ya

Dr KSS MD PhD (former columnist)
Member
47632
Scott Postma: your lack of information and unwillingness merely to join the irregulars where I have posted about this stock DEFINITELY is not an emergency on my part, and if you think I am going to devote my precious time to respond personally to you here after you have barged in shoving elbows and stirring up trouble and lashing out at me, well dream on. If you want to (1) APOLOGIZE, (2) come to the Irregulars, and (3) show yourself not to be a bombastic self-centered lout, then I will communicate with you. You’ll catch way more flies with honey… Read more »
srpostma11
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Okay. I am new to this site. I have updated some of my info. I did not mean to make a comment that was taken offensively. For that, I am sorry.
I am here to learn all I can about cel-sci and their drug.
I would appreciate it if you could explain why doctors would not use multikine even with FDA approval? Thanks.

Alan Harris
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Scott: try ctrF CVM. Theres mention here and on Eyes and Ears and Nash threads. One comment says….I would hold it at arms length between thumb and forefinger….It stinks.

srpostma11
Member
2

Thanks. I did that. It is the first thing I do when I don’t see Cel-Sci in the head lines.
Unfortunately I don’t have access to the Nash threads.
I read what KSS said earlier but got completely distracted when he said “Even if the product is approved, physcians will never ever use it.” I am not a doctor but this seemed to be a bizarre statement. Therefore I asked KSS how this could possibly be? I am still waiting for an answer.

Alan Harris
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I have a sneaking suspicion you will get no further answer. He is a doctor so we must assume he knows what doctors like and dislike generally. As we are not doctors, we must either accept he knows best or ask someone else coz he will not suddenly have a change of heart ! Im sorry you dont have access to the other thread coz your missing some great stuff. $49 sees a small price to pay. Good luck with your investment and I hope you succeed in saying ‘I told you so…..’ Let me know. Heres a couple of… Read more »
srpostma11
Member
2
Alan – thanks for the reply. They are improving. I really do appreciate it. You are right, reverse splits hurt. No doubt about that. ———– You say “but they will never some up with any real data”. I don’t know if you saw my other post so I will repeat it here. Phase 2 had very good data and the company also followed up with the patients after 3.5 years to get a survival rate of 66%. Yes, the sample size was small. Here is a link to the jounal. http://jco.ascopubs.org/content/23/15/3421.full I find its bizarre that you say some companies… Read more »
Alan Harris
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No Scott, ‘I’ dont say!!……..I simply cut and pasted comment to save you the $49 irregs subscription fee as you seem soooo reluctant to cough up. In short…. I was trying to do you a favour. But you must remember: while youre interest maybe CVM, KSS has diss’ed it….thats end of story on GS. If you cant accept that….tough! Life moves on here even if it doesnt there. GL

Dr KSS MD PhD (former columnist)
Member
47632

To Denis Smalley: you might want to join us on the irregular thread under the NASH discussion: http://www.stockgumshoe.com/2014/03/microblog-nash-an-all-too-common-liver-disease-and-a-company-aiming-to-treat-it/#comment-1367134

I have some thoughts about your case and who you might see. I have been meaning to post some comments about interferon regimens because GK Doussis asked about them,

LongOnLife
Irregular
667

Thanks Dr. KSS. Since I upgraded my Gumshoe account, I’ve been reading the NASH post and trying to get caught up. The amount of information coming through these channels is mind blowing. Definitely look forward to hearing your thoughts. There are may folks here that are grateful for your time and insight. Count me as one of them!

Opposeablethumb
Irregular
1266

Disappearing rows on spreadsheet have been due to someone filtering the data. If we hover over the filter icon and it says turn off filter then click on it and the rows missing will reappear . Those that want to filter should pull a copy down to their own machine to do so.
Those that are superior to the rest of us may continue to filter the original at will.

ggswift
Irregular
35

DRTX is set for an FDA Decision on 5/26/14, but of course that date is a holiday……DRTX has not shown much positive movement ………any interpretations? Thank You!

Lawrence
Guest
0
My name is Lawrence, I am from U.K. I want to share my testimonies to the general public on how this great man called Dr Osas cure my sister from Genetic Herpes with the herbal medication gotten from dr. osas, he cures other diseases too herbal is a great medication. To hell with the government and their insane policy, he have a medication that is hundred percent assured to cure genital herpes and you don’t need to spend so much money on anymore . I want you to contact dr Osas on: doctorosasherbalhome@gmail.com My family is now a brand new… Read more »
Dr KSS MD PhD (former columnist)
Member
47632

Lawrence, sorry, but you have been grossly deceived. These are fraudulent claims, and if you sister actually had genital herpes, I can assure you she still does and is quite contagious. Re your number 30, you might want to ask him to remove the spell he has put on you. At first I thought your post was a joke, but in fact it is very disquieting. Good of you to name this criminal and provide his email address so that regulators can be notified. You have been badly scammed and cheated. Osas, who is not a doctor, belongs behind bars.

Alan Harris
Guest
0

Wow! Coughs, colds, sneezes, chills and pimples on the dickie.
To the tune of ‘He put a spell on you…….’

David A
Guest
0

This stock is down to .70 cents a share. In or around December 15th, it plunged from $3
to .70 cents! Anybody know why?

fallenfruit
Member
0

T-Bird Pharma is not the symbol above (that is a Chinese co.) The symbol is TBQBF. It is a grey market stock.

bfromme
Member
2

According to my online broker CYCC is being delisted. I wouldn’t touch this.

Gr8Full!
Irregular
9689

CCYC-From 12/16/14 comment on Irregular files: down nearly 70 percent today alone. Gummies were warned here that this would happen in February 2014…doesn’t surprise me. Membership has many privileges 😉 Best2ALL!-Benjamin

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