This is a pitch from Jason Stutman’s The Cutting Edge newsletter, his higher-end service from Angel Publishing (about $1,500/year), and what caught my eye was the headline promise that Harvard University is “calling for a 29,000% surge for one tiny company you’ve never heard of.”
So what is it? Well, it’s appropriate that we’re looking at this during the same week that Doc Gumshoe looked into the opioid epidemic for us… because this is a pitch all about nasal Naloxone, marketed as Narcan, the anti-overdose drug (an opioid antagonist, if you want to get technical) that’s carried by most first responders (and increasingly other folks, like friends and neighbors of addicts) and is used to reverse the effects of heroin or other opioids in folks who have overdosed.
The “Lazarus” bit is, of course, a dramatic reference to Jesus’ final miracle (at least before his own resurrection, I guess, if that counts as one of his miracles), the resurrection of Lazarus of Bethany four days after he died and was buried. And yes, Naloxone can bring patients “back to life” who are on the verge of death and have stopped breathing because of an overdose of heroin or oxycontin or other opiates.
Naloxone is a generic drug, off patent for almost 40 years, so it is relatively inexpensive and should be widely available, but, like with the Epipen and epinephrine, the delivery mechanisms and distribution platforms are anything but generic — there are currently a couple companies making autoinjectors and nasal formulations of naloxone, in addition to the basic drug (for injection), with pretty wide variants in pricing and marketing strategy. And though outrage has perhaps been slower to build when it comes to saving the lives of addicts (naloxone) instead of saving the lives of little kids with peanut allergies (Epipen), there have been several waves of outrage in the past about pricing for Naloxone and how that might deter distribution of the overdose-reverser.
So what is it that Stutman is pitching here? Here’s a taste of the ad:
“But one tiny California company has come up with a solution… a treatment you’ve seen in action before your very eyes today.
“It involves a simple burst of lifesaving medication, inhaled through the nose, which immediately reverses the effects of this deadly disease.
“‘It literally snatches them back from the brink of death,’ says one eyewitness.”
He’s clearly specifically pitching Narcan nasal spray, which is sold by Adapt Pharma — he even shows some videos and photos of Adapt’s specific branded nasal spray delivery system for Narcan, which differs from some of the other atomizer-type nasal applicator kits for the drug that aren’t specifically FDA approved, but which seem to be in pretty wide use regardless.
If you’re confused about the names “Narcan” and “naloxone”, naloxone is the name of the chemical compound, and the generic name… Narcan was the original brand name for naloxone in the 1970s, and a few years ago Adapt bought that brand name, which had not been officially in use in a product for several years, to give its nasal naloxone better brand recognition.
But Adapt Pharma is not a publicly traded company… so from whence will our riches flow, dear readers? let’s see what else is noted in the ad… first, a bit of tantalization for your wallet:
“This company isn’t one of several that are pioneering this treatment.
“There’s just one. And it’s the company I’m telling you about today.
“And it’s so far ahead of the competition that Harvard predicted this company’s sales will explode by 29,000%.
“I’m sure you can imagine what that kind of profit ride would mean for you as an investor…”
OK, so that’s at least an exaggeration — this is, as we noted, a generic drug, and there’s an opioid epidemic now in its second decade (depending on who you ask). There are other companies trying to sell into this market, regulatory questions about pricing, and different delivery systems being sold for generic naloxone. Perhaps this one has some unique “special sauce,” we’ll see, but emergency applications for opioid overdoses are, unfortunately, seeing growing demand… and growing demand for previously “niche” pharmaceuticals brings both crazy pricing and, eventually, more supply, particularly when no one has a patent on the underlying chemical compound.
But what else do we get as the hints are dropped and the newsletter is pitched? Here’s some more:
“Currently, this company is trading at a minuscule market cap of less than $100 million…
“But that’s right now, as I write this — and considering the contagious momentum this company’s valuation has recently seen…
“I wouldn’t be surprised if this number has already grown by the time this urgent message reaches you.”
Feel that itch? Deep in your hip pocket, near the wallet? That’s the same itch that comes up because the car salesman says he has to “go talk to his manager” and “we’ve only gone one more car we can sell at that bargain price this month.” Try not to scratch it, you’ll get an infection.
What other clues do we get? Well, there are several other hints dropped about Narcan, including references to the endorsements this lifesaving medicine has received from Dr. Oz, Sanjay Gupta and the U.S. Surgeon General (the past one, not Dr. Adams… though Adams also pushed for more Naloxone access when he was health commissioner in Indiana under then-governor Pence, and reportedly talked Pence into needle exchange programs to combat Indiana’s pockets of HIV infection). And all of those references benefit Adapt and its Narcan-brand nasal applicator, since they have the brand recognition (and since that’s the easiest way to give naloxone, with no needles or mixing).
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Here’s a bit more from Stutman’s spiel…
“I know of at least one leading financial research firm that’s already starting to wise up to this profit situation.
“This firm, One Equity Research, is looking at the disruptive company behind the “Lazarus Project” with a string of dollar signs in its eyes…
“It’s calling this tiny company’s lifesaving invention a ‘billion dollar opportunity.’
“But not for just anyone.
“It’s only the ‘early movers’ in this space who will reap the lion’s share of the riches.”
And the ad also gives the implication that “it’s so easy, a child could use it” by referring to one well-publicized case of a nine-year-old who learned how to give Naloxone treatment because she was worried about her older brother relapsing and overdosing on heroin…
“In fact, nine-year-old Audrey Stepp is one such kid. She recently put her treatment skills on exhibition…
“I wasn’t kidding when I said this tiny California company designed this “miracle” medicine to be as easy to use as possible.
“Even a grade-schooler can use this lifesaving solution…”
That is a real case and a real example, though that reference is to a different formulation than the nasal delivery device sold by Adapt Pharma — according to the video story from last year, Audrey learns how to fill a syringe atomizer and also how to use a cartridge-based autoinjector, neither of which is the “easier” Narcan nasal spray that Adapt sells. Which is a good reminder that there’s more than one way to save a life, I suppose, but also that there’s often more than one provider for a desperate market.
What else do we get from Stutman?
“It’s now available over the counter.
“As I write this, CVS is already selling the ‘Lazarus Project’ rescue drug in 15 states… and it’s in the process of adding it to 20 more.
“That’s right — you can walk right into the CVS pharmacy and purchase it for home use without a prescription.
“It isn’t just CVS, either. Walgreens has it available over the counter, too…
“Already in 35 states and the District of Columb