In 2007, 13% of all deaths worldwide were caused by cancer (7.9 million). That same year, the overall cost of cancer in the US alone, including treatment and indirect costs such as loss of productivity in the workplace, ws estimated to be $226.8 billion. The incidence of cancer is growing every year, partly because people are generally living longer, and also because 90-95% of cancers are caused by environmental factors, and only 5-10% by heredity.
With the increasing prevalence of cancer, more and more research is being done on diagnosing it, treating it, and even curing it. Depending on whom you trust, significant progress is being made, much of it by young companies blazing research trails with new ideas. Some will fail, of course, but some may give hope to cancer patients soon and in the future. It would be foolish to try to survey these companies on a systematic basis — and anyone thinking of investing in cancer-related companies should undertake serious research before making investment decisions. We do NOT make recommendations — we only write about companies that we find interesting.
Lincolnshire IL-based BioSante Pharmaceuticals (Nasdaq: BPAX; http://www.biosantepharma.com/) might be one place to start. Focused on female sexual health and oncology, BPAX has a portfolio of cancer treatment drugs, several of which have been given orphan drug status. But one of the most interesting is a drug that uses a virus derived from adenovirus type 5, a common cold virus that replicates in and selectively kills tumor cells. Finding a silver lining to the miseries of a common cold would be a rewarding type of irony. BPAX trade at about $0.79, down from the $4 range within the last year. As of their last quarterly report in November, the company had about $70 million in cash, but for the first nine months of 2011, the mostly pre-revenue company lost about $45 million, so there is a balancing act to investigate. The market cap is about $87 million, and daily trading volume is listed as nearly 8 million. Here is a later recommendation from SeekingAlpha: http://seekingalpha.com/article/398721-2-speculative-biotechs-to-consider.
Seattle-based Cell Therapeutics (Nasdaq: CTIC; http://www.celltherapeutics.com/) is developing potential therapeutics for a rainbow of cancers: non-Hodgkins lymphoma, various blood cancers, as well as ovarian, brain, esophageal, breast and non-small cell lung cancer. It is also developing a platinum-based chemotherapy drug to treat a variety of cancers. Some products are in Phase III, which means they may be close to the market if the FDA clears them. CTIC shares closed Friday at $1.35, up 21% on the day after an encouraging announcement regarding European approval for one of its lead drugs, Pixuvri (the non-Hodgkins lymphoma drug), vs a 52-week high of $2.46 on volume of 2.4 million shares a day. Market cap is about $250 million. A complicated financing prospectus was filed in the autumn and supplemented in December. The stock could go up strongly again on Tuesday.
Quebec City-based AEterna Zentaris Inc (Nasdaq: AEZS; http://www.aezsinc.com/) is another fascinating company. Like CTIC, there is a long menu of drugs that address a huge number of cancers. Therapeutics under development target colorectal cancer and multiple myeloma, ovarian, endometrial, castration refractory prostate, and refractory bladder cancer. AEZS is also developing a diagnostic for adult growth hormone deficiency, and a vaccine for some solid tumors. All these are pre-approval. The shares trade at $1.64 vs a range of $1.35 – $2.68 over the last year, on volume of just below 1 million shares a day. Market cap is about $170 million. AEZS had about $48 million in cash as of Sept 30, 2011, and had eked out a small profit for that quarter, though it had lost significant amounts earlier in 2011.
Some biotechs spike up like roman candles and then move down with equal speed if the progress does not match expectations. One such might be Austin TX-based Vermillion Inc (Nasdaq: VRML; http://www.vermillion.com/), which gained FDA approval for OVA1, its ovarian tumor triage test. The stock roared up to $7.60 last year and has since dropped to $1.39, which is where it closed last week, after adoption and patient use failed to come even close to what was predicted. Today VRML is selling for $20.7 million, about the value of its cash. Share volume is a bit over 100,000 shares per day.
And the dark horse in that area of ovarian cancer diagnosis is a little-known Australian company, Healthlinx Ltd (ASX: HTX; www.healthlinx.com.au). We know Healthlinx because they are a client of Allen & Caron, the publisher of this blog. Their OvPlex blood test, approved for use in several countries (but not the USA yet), may be the first effective test for ovarian cancer. One of the most common forms of cancer in women, the gold standard of diagnosis is a test called CA125, which has a dismally low ability to diagnose (but it’s the best thing we have so far). If clinical tests to date are any indicator, OvPlex could give new hope to women all over the world, and at a more-than-reasonable price. HTX shares trade only on the Australian Stock Exchange, and are priced at $0.01 with volume of 1.5 million shares per day, and a market cap of about $2.4 million. There is no ADR at this point, but the largest market for ovarian cancer tests is the US, and it is highly likely that HTX will be have a US presence in the near future.