The Big Bet on Protalix

Protalix BioTherapeutics (AMEX: PLX  ) is up more than 40% this year as investors poured into the company ahead of its return trip in front of the Food and Drug Administration. The agency is scheduled to decide about its Gaucher disease treatment taliglucerase alpha on Tuesday, although that's more of a goal than a deadline. The drug is licensed to Pfizer (NYSE: PFE  ) , but Protalix's stock has greater potential to move on the approval because of its smaller size.

Taliglucerase alpha was up for approval two years ago, but the decision was delayed because the FDA wanted more information on the manufacturing process for the drug, which is made in plant cells rather than the more traditional mammalian cells. Eventually, the FDA rejected the drug, requesting clinical data on the switchover trial and other information about how it tests the drug to make sure it's been produced correctly.

I hate these types of binary events. There are too many unknowns with manufacturing issues to feel confident about an approval. Discovery Laboratories (Nasdaq: DSCO  ) , for instance, went through four rejections mainly for manufacturing issues before finally gaining approval of Surfaxin, its preventative for respiratory distress syndrome.

And it's not as if the FDA is likely to be lenient just because Gaucher disease is rare. The FDA turned down ViroPharma's (Nasdaq: VPHM  ) request to make Cinryze at a larger scale because it had additional questions about the technical process of the making the new formulation of the treatment for an orphan disease called hereditary angioedema. And last week, Shire Pharmaceuticals (Nasdaq: SHPGY  ) announced that the FDA had turned down the approval of the new manufacturing site for Vpriv, which also treats Gaucher disease.

Protalix says it's answered all the FDA's questions, and I have no reason to think otherwise. But investors have very little insight into what the FDA is thinking about the manufacturing issues. I hope taliglucerase alpha is approved, but given the unknowns, I don't see how it's worth placing a big bet on the agency's decision.

While you're waiting for a decision on taliglucerase alpha, take a look at what Fool analysts believe is the next rule-breaking multibagger. Get the free report.

Fool contributor Brian Orelli holds no position in any company mentioned. Check out his holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Pfizer. The Motley Fool has a disclosure policy.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


Read/Post Comments (1) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1875327, ~/Articles/ArticleHandler.aspx, 9/23/2014 10:34:10 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement