“‘The Retirement Stock’ … on the verge of gaining FDA approval for the only ‘female Viagra'”

This is really disappointing. All this time I’ve been under the impression that your friendly neighborhood Stock Gumshoe and his terrifically handsome likeness were all the “female Viagra” the world needed … but apparently some pharmaceutical companies disagree, and have been trying to develop a drug along those lines.

At least, that’s the pitch from the folks at Money Map Press — they’re pitching their “Passport Club” by enticing us with the story of a little drug company that they think will explode in value over the next few months, based largely on good expected Phase III trial results and eventual FDA approval of their “female Viagra.”

The Passport Club, just FYI, is one of those “lifetime membership” deals — you pay a multi-thousand dollar fee up front, and they give you access for life to a big stable of different newsletters and trading services in perpetuity (with a smaller annual fee, $100 in this case). They add the additional pitch that they’ll send you a check for $2,475 to help you buy a couple thousand shares of the stock they’re teasing … but since the club itself costs $6,750 that’s just an exciting way to get your attention (“On July 5th Mike Ward Will Again Be Writing Out Checks To Money Map Readers for $2,475”). Car dealers have done this forever — it’s not just a discount, it’s “cash back!”

So that’s what they want us to buy — what’s the stock they’re teasing?

They tell us that they’ve been watching some successful drug stock investors, and that they followed these hedge funds and similar folks into a highly lucrative investment last year … and that it’s about to happen again:

“While researching this opportunity, we believe we identified a highly predictive “stock accumulation pattern” that can tell us which little companies these successful funds think are on the verge of breakthrough gains.

“More specifically, we’ve found another tiny little company many of these same players are rallying around… and for very good reason.

“It’s a company that very well could be on the verge of one of the biggest drug breakthroughs since Viagra – and given the demand for this kind of treatment, the FDA would like nothing better than to approve it before the year is out.

“The stock is trading cheap right now – right around $2.

“What’s more, there are two very important “catalyst dates” coming up that should jolt the stock higher on each occasion – the first one in by Summer and the second in October. (I’ll tell you more about it in a moment.)”

The promise, of course, is very drool-worthy:

“That’s because our research suggests this little stock could (and should) be trading at over $5 within the year – a better than 150% gain from where it trades now.

“But that’s just the beginning…

“Should this little company’s treatment keep getting great results through Phase 3 testing and make it to market in the next year or two…

“This company could be the lone player in what’s estimated to be a $2 billion market… and watch its share price rocket to $148 or more in the next five years alone!”

And the Money Map folks also do a little bit of teasing about the big backers who they followed into this stock, along with a few more clues …

“Just like with the company we found earlier this year, some of the wealthiest and most successful drug industry experts have been plowing millions into this tiny little company.

“Of course the big names like Blackrock, State Street and Vanguard are all in.

“But one investor – a medical doctor and co-founder of a investment firm that specializes in medical start-ups – interests us the most.

“With a nearly 5% share stake he’s not only the largest individual shareholder already – he recently upped his stake in the company by over 28%.

“Of course we can’t claim to know his motives for padding his share ownership by millions. But the timing of his buying spree does seem somewhat telling.

“The company had recently reported stellar Phase 2 Clinical trial results – and announced that enrollment in a pair of Phase 3 efficacy trials would both be underway by this summer.

“Typically, this is the last set of tests before a drug can be approved by the FDA. And because Phase 2 trials went so smoothly, many in the industry feel the Phase 3 tests are more of a formality than anything else.

“In addition, the company recently announced it had secured nearly $25 million in additional investor funding to see the Phase 3 efficacy and safety trials through to their completion.

“Clearly, the company – along with its top investor – believe this drug, which is a breakthrough Viagra-like treatment for postmenopausal women suffering from sexual desire disorder – believe the chances for approval are very good.”

Well, that ought to be enough to feed into the Mighty, Mighty Thinkolator — so what have we got?

BioSante Pharmaceuticals (BPAX)

This one actually tickled my memory a little bit — I think it was recommended by the Motley Fool folks, probably the Rule Breakers newsletter, back in 2004, and yes, back then it was still all about this “female Viagra” — which is actually a testosterone gel that’s formulated for women, and which reportedly helps to increase the sex drive in postmenopausal women. Perhaps even more than looking into the steely gaze of yours truly.

The drug, which is called LibiGel, was pretty much assumed to be dead not long after that — the stock got up to $10 or so in late 2004, then collapsed to $4 after the FDA rejected a competing testosterone patch from P&G and at a time when drug risks were in the headlines (remember Vioxx?) and hormone therapy (mostly estrogen) was being hotly debated. The shares have risen and fallen several times since then, I can’t claim that I’ve been following the story very closely but there have been a few significant events in the past few years — they got agreement on a testing protocol for LibiGel back in 2008 and have run a few Phase III trials since then, and also merged with another company along the way, Cell Genesys, which brought them in to the cancer vaccine business and had some folks thinking of them as a “next Dendreon” for a spell. They’ve also sold shares several times in the last few years to raise lots of money for their continuing trials and development (when I first being touted for the potential of LibiGel back in 2004 they had about 17 million shares outstanding, now they have about 73 million).

The cancer vaccine has been offloaded to a partner, so if anything comes in from that it will be many years off and it will be only in the form of royalties — they clearly didn’t have the money to develop it, so they basically gave it away for the future potential royalty stream. They do have a few other drugs as well, mostly for women’s sexual health — including one (Elestrin) that is approved and is being sold by their licensing partner, Azur Pharma, but there is no appreciable revenue from that drug in comparison to their massive R&D costs, so they have now accumulated about $166 million in losses over the past decade or so. Which, to look at the bright side, means they won’t be paying much in the way of taxes right away if LibiGel ends up getting approved and generating income.

I can’t claim to be an expert on BioSante or LibiGel, but there is certainly a large market — the Money Map folks compare it to the $2 billion ED market on the men’s side, and other folks agree that there’s a substantial unmet need. On the flip side, generic testosterone is certainly already available and can be formulated by lots of different companies, so what BioSante appears to really be counting on is the appeal of their gel delivery system and the marketing push they might be able to put behind an FDA-approved drug that’s specifically approved for female sexual dysfunction. There are, as any internet search will tell you, plenty of drugs that call themselves a “female Viagra” of some sort, including several others that have been tripped up in the FDA approval process — the most recent one I noticed was flibanserin, which was a pill that was withdrawn last Fall after a negative advisory panel review, and of course there are also dozens of over the counter herbal products and off-label hormonal therapies that aim for a similar effect.

BioSante announced enrollment of their latest Phase III trial just yesterday, with this one targeted specifically at testing safety with regards to breast cancer and cardiovascular health. It’s a five-year study, but they say they’ll have results in about a year and plan to apply (assuming, I guess, that the trial has positive results) for FDA approval in 2012. BioSante investors might be forgiven from shaking their heads and muttering that they’ve seen this story play out before, but the potential of that large unmet market need keeps them coming back — as they have been over the last six months or so, causing the stock to roughly double in that time to where it stands now, just over $3. There was also a little spate of insider buying (very little) early in the year in the $1.75-$2 range.

The stock has climbed by about a buck over the last month, so it was right around $2 when they were probably writing this teaser, and optimism has returned in the face of a couple investor conference presentations, some positive chatter in the investing media, this newsletter tout and probably others, and some hopeful talk from management around the time of the last earnings release, leading up to the enrollment of this latest Phase III study.

And yes, there are some medicine-focused institutional investor/hedge fundies who have large positions in BioSante. I don’t know exactly which one they’re teasing in the ad, but it seems likely to be Jeffrey Jay of Great Point Partners — they are large shareholders in BPAX, with over 8% of the shares, but haven’t actually increased that holding as of the last quarter (they may well have done so previously). Other funds have added more to their BPAX holdings lately, including Broadfin Capital, which also has a pretty concentrated position in the shares, but I don’t know that Broadfin was co-founded by an MD like Great Point was. There are very few mutual funds in these shares other than a few index funds who can’t avoid the stock, it’s almost all hedge funds.

So there you have it — interesting to see this company in the news again, I hadn’t been paying attention and, if pressed and blindfolded, would probably have guessed that they were out of business by now … but the size of the market and the continuing shreds of hope from the FDA apparently kept them going, to the point that they seem to (again) maybe have some real hope for approval now. I have no idea whether it’s really likely that approval would be a “formality” as they hint at in the ad, since the FDA approval process seems to bring too many surprises to make many assumptions like that, but hope springs eternal. If you’ve been following the BPAX story or have info to share on their hopes for this “female Viagra,” please feel free to let us know with a comment below.


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10 Comments on "“‘The Retirement Stock’ … on the verge of gaining FDA approval for the only ‘female Viagra'”"

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OliverR
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OliverR
June 1, 2011 1:07 pm

I bought some BPAX after a secondary late last year at $1.64 and just sold a portion at 3.05 last week. I'm holding the rest to see if it can push on further.. Not that this really provides any extra information that wasn't already in Travis' explanation of LibiGel. With the merger of Cell Genesis they did obtain a prostate cancer vaccine called GVAX (which was supposed to be better than Dendron's provenge) plus cash. So there are things other than LibiGel that could be drivers of the stock price as well.

craig
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craig
June 1, 2011 3:32 pm

If you want to check out a company and a product that has very high potential ,check out palatin technologies ( AMEX : PTN ) the product to watch is PL-6983 if they receive FDA approvial this could be a mind blowing stock ! once in a life time

kbam
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kbam
June 1, 2011 10:48 pm

god help us all if old women load up on this and then go out hunting men

we are doomed

sundaygirl
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sundaygirl
June 1, 2011 11:33 pm

In which case, kbam, the first one I'll be lookin' for is you! 😉

Marc
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Marc
June 4, 2011 11:30 am

So in few years american female need a razor!
Seems like a big deviation on what a medic must done!

lee
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lee
June 4, 2011 9:56 pm

That's a lot of research and a lot of doctors to interview… perhaps it would be beneficial to dedicate a fraction of the research time to investigate the meaning of "there" and "their"

@CleverTrade
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June 8, 2011 6:48 pm

BWSOF Security Details

JoJo
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JoJo
June 2, 2011 9:03 pm

Travis?

OliverR
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OliverR
June 8, 2011 5:46 pm

Travis Johnson aka the Gumshoe

@CleverTrade
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June 8, 2011 6:49 pm

please remove my post here, something went wrong Travis.

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