This Week in Biotech: Diabetes Patients Chalk Up 2 Impressive Victories

Legal settlements and victories, an FDA approval, and two positive clinical results take center stage in this holiday-shortened week in the biotech sector.

Apr 19, 2014 at 3:15PM

With the SPDR S&P Biotech Index up 23% over the trailing-12-month period, it's evident that investment dollars are willingly flowing into the biotech sector. Keeping that in mind, let's have a look at some of the rulings, studies, and companies that made waves in the sector last week.

Laying down the law
It may have been a holiday-shortened week, but there was no shortage of legal actions to keep investors busy this week.

Shareholders in DepoMed (NASDAQ:DEPO) were treated to great news earlier this week when the company announced that it had reached a patent litigation settlement with two privately held companies that had been planning to file an abbreviated new drug application for Gralise, a medication given to patients following a bout of the shingles. The settlement, which pushes these companies from bringing generic Gralise to market before Jan. 1, 2024, helps ensure the continued exclusivity of Gralise which was DepoMed's biggest seller last year with $36.2 million in revenue. Of course, DepoMed also pointed out that it's still pursuing patent litigation against Actavis to prevent its ANDA filing.

Zogenix (NASDAQ:ZGNX) shareholders also had reason to celebrate after issuing a press release Tuesday night that announced the U.S. District Court in Massachusetts had entered an order to prevent the implementation of a sales ban on severe pain medication Zohydro ER. Massachusetts' Gov. Deval Patrick had intended to prevent the sale of Zohydro ER within the state as he felt there was a high risk for abuse of the drug.  The District Court blocked this order presumably to demonstrate that states couldn't pick and choose what drugs to allow and what not to allow, as well as reinforce the idea that the Food and Drug Administration is the official determiner of a drugs' labeling, not the individual states. While good news for Zohydro ERs potential in Massachusetts, the sheer number of questions surrounding the abuse potential of this drug make its peak sales potential very difficult to map. As such, I'm perfectly happy sticking to the sidelines.

A big week for diabetics and GlaxoSmithKline
On top of being a big week for settlements and legal victories, it was also an important week for the nearly 26 million diabetics in this country.

GlaxoSmithKline (NYSE:GSK) on Tuesday announced the FDA had approved its once-weekly subcutaneous injection Tanzeum as an adjunct treatment of type 2 diabetes in addition to proper diet and exercise. Specifically, Tanzeum is a glucagon-like peptide-1-receptor agonist which helps reduce blood glucose levels in type 2 diabetes patients. Following the approval, GlaxoSmithKline announced it would launch the drug in the third quarter.

On a side note, this wasn't Glaxo's only win this week, with it and Genmab announcing the FDA approval of Arzerra as a first-line treatment in combination with chlorambucil for chronic lymphocytic leukemia patients. Its late-stage study demonstrated statistically significant improvements in progression-free survival which made its approval rather unsurprising, but nonetheless welcome. 

The other potential win was for type 1 diabetics from the release of mid-stage data from Lexicon Pharmaceuticals (NASDAQ:LXRX) and its lead diabetes therapy LX4211. In its study LX4211 met its proof-of-concept endpoints by reducing total daily mealtime bolus insulin dose by 32% compared to just 6% for the placebo. It also significantly reduced mean HbA1c levels by 0.55% compared to just 0.06% for the placebo. Lexicon's therapy is particularly intriguing to me because it's a dual inhibitor of SGLT1 and SGLT2. There are currently two SLGT2-inhibiting therapies approved by the FDA for type 2 diabetes patients that work via the kidneys. Adding the SGLT1 inhibitor, which works in the gastrointestinal tract, could give LX4211 a comparative advantage over existing therapies, at least in the fact that it works for both type 1 and type 2 diabetes patients. I'd certainly encourage you to keep an eye on this company.

Baxter's big win
Last, but certainly not least, Baxter International (NYSE:BAX) announced that BAX 111, its recombinant therapy under investigation to treat von Willebrand disease, the most commonly inherited bleeding disorder, had met its primary efficacy endpoint in a phase 3 study as a stand-alone treatment. As Baxter's press release notes, not only did it meet its pre-specified efficacy level, but all 22 patients achieved success in treating on-demand bleeding events. Best of all, there were no out of the norm serious adverse events. Full data from its study is expected to be presented later this year with Baxter intending to file for approval of BAX 111 before the end of the year.

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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

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KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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