GTCB Drowns

Ok, so the decision went against GTCB. At least one of the given reasons (extra purification step) sounds like a red herring to me. Such filtration techniques are usually polishing steps rather than steps with strong resolving power to greatly enrich the protein of interest. That this is one of the dealbreakers suggests to me that there is a level of uneasiness which the CHMP did not want to articulate in writing.

So what to do?

Well, the "this-is-a-first-of-a-kind" situation risk was why the portfolio had a relatively small exposure to GTCB (5%). That's the good news. The bad news is that marketing has been seriously pushed back, with the U.S. application possibly being the lead application now... and that's a sad reflection because the trial to spearhead the U.S. application is not complete. Therefore, dilution will come, and any future revenues (*if*) will be diluted even further.

But for the purposes of this portfolio, given the limited exposure, I'm treating this position as a proof-of-concept (and no, the concept is not to prove that I can lose fictional money). I do think alternative production strategies are required for the continued economic feasibility of biologics. So the goats stay because they have ultimate value, if not to GTCB, then to another suitor. The economic windfall from a cheaper biologics production strategy is too lucrative to ignore.

Had this position been 10% of the portfolio or greater, I would have sold today. The small hit that it took (down 40 cents from the purchase price) would have been a gift opportunity to get out relatively unscathed.

So GTCB was the first big decision since the portfolio was formed. It went negative. Next (predictable) big day will be Telik's announcement of phase III results. All I ask is for all three Telik trials to be successful... yes, I'm that easy.