End of March Update

Always delayed, but...

The prices are as of close of trading on April 7, 2006.

Portfolio:

TELK / Telik Inc. : Position opened with 806 shares purchased at $18.62. With Telik closing at $17.75, the current value is $14306.50, a loss of $701.22, or -4.67%.

OSIP : Position opened with 356 shares at $28.09. With OSIP closing at $30.02, the current value is $10687.12, a gain of $687.08, or +6.87%.

MLNM : Position opened with 983 shares at $10.17. With MLNM closing at $9.60, the current value is $9436.80, a loss of $560.31, or -5.60%.

GTCB : Position opened with 2873 shares at $1.74. With GTCB closing at $1.02, the current value is $2930.46, a loss of $2068.56, or -41.38%.

GNVC : Position opened with 1169 shares at $1.71. With GNVC closing at $2.15, the current value is $2513.35, a gain of $514.36, or +25.73%.

CTIC : Position opened with 966 shares at $2.07. With CTIC closing at $1.79, the current value is $1729.14, a loss of $270.48, or -13.53%.

SPDHF / Speedel : Position opened with 91 shares at $110.08. SPDHF closed at 181 Swiss Francs, and with 1 Swiss Franc = 0.771903 U.S. dollars, the adjusted share price in USD is $138.94. The total value of the position is therefore $12643.77. Minus the opening cost of $10017.28, the position if profitable for $2626.49, or +26.22%.

Total stock positions are valued at $54246.14. Cash level is $45980.22. Total value is $100226.36, or an increase of 2.26% (EDIT: This is clearly crap math on my part... it should read an increase of 0.226%... round that to zero if you wish!).


Adjustments:

Going to take this time to purchase 1250 shares of SGXP ( SGX Pharmaceuticals Inc.) at $8.00, which is the closing price as of April 6, 2006.

Total cost is $10000, and that will reduce the cash position to $35980.22.


Comments:

Telik continues to get battered in the last couple of weeks. Not surprising, as investors are likely (and rightly) nervous before phase III results. Biotechs in general have also been weak. I think ASSIST-3 is a guaranteed success, mostly because the primary endpoint is a gimme. ASSIST-1 and 2 are the toss-ups. Statistical significance in ASSIST-1 will be sufficient for marketing approval and sales. As for ASSIST-2, I'm thinking that the magnitude of the putative survival benefit will be the determining factor. A stat sig outcome in this trial with a modest survival increase may land Telcyta in the shark infested waters of 2nd / 3rd line NSCLC. Tough to make sales of a drug in that arena, especially if the median survival is in the 7-8 month ballpark that the competition is demonstrating (Taxotere, Alimta, Tarceva). With Telik having excluded BAC, the overall survival of the Iressa arm in this trial may appear to underperform what most may expect from a 2nd / 3rd line NSCLC population. Telik would have to do a pretty good job of detailing to stress the difference.

All in all, I'm thinking 2 of the trials will be successful, specifically ASSIST-3, and one of ASSIST-1 or 2. I'm undecided right now as to which has the better chance, but just for fun, I'll go with ASSIST-1. We'll see how wrong I am in a couple of months!

CTIC sickens me. But I'm keeping it in the portfolio, just as an "intellectual" play on pixantrone, and whether it will demonstrate success as I hope. Otherwise, there is absolutely nothing appealing about CTIC as an investment.

I bought into SGXP. I think their 3d structural work is a viable service arena. The recent collaboration with Novartis for a CML drug is a step in the right direction. SGXP's lead candidates are targeting BCR-ABL signaling, and have demonstrated the ability to inhibit a broad variety of BCR-ABL mutants, particularly the T315I mutation which Gleevec and dasatanib are unsuccessful at shutting down. This indication also lends itself to fast and significant clinical responses, so it would not be surprising to see this compound quickly show significant responses in a phase I population selected for the T315I mutation.