The publishers of MicrocapResearch.com have taken long positions in Sorrento Therapeutics, (SRNE)NasdaqCM (web site) at $8.60

Share price:[s_static_display codes=”SRNE”]

  • We believe the move over the last week is just the beginning of a much larger move in 2015.
  •  Our report on Sorrento Therapeutics will be published on 12/26/2014. 

 

 

Most of all, we want to thank you for subscribing during our early launch period.

We look forward to sharing great small and microcap stocks with our subscribers in 2015 and beyond.

 

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Rockwell Medical

 


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First Paralyzed Human To Have Received Neuro-Spinal Scaffold Implant Says “I’m Going To Walk Again”

Author: John Harrell


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Summary

  • Rare interview of a patient during a clinical trial.
  • Gradual, but significant progress is occurring.
  • Jordan Fallis’ attitude, courage and determination makes everyone want to root for him.

Back on October 15th, InVivo Therapeutics (OTCQB:NVIV) announced that their long awaited clinical trial involving humans was underway, as the first patient in the world to receive a Neuro-Spinal Scaffold implant for traumatic spinal cord injury had undergone successful implant surgery. The objective of the pilot study is to evaluate the safety and feasibility of the Neuro-Spinal Scaffold as well as to gather preliminary evidence of effectiveness. The ultimate goals for the scaffold implant are outlined here on page 10 of the company’s recent November 19th presentation. Some of these goals for those suffering from paralysis include recovery of muscle control, movement, strength, a decrease in neuropathic pain and most importantly in my opinion, recovery of bowel/bladder control. Assuming that the scaffold implant leads to a reversal of paralysis and even partially accomplishes any of the above named goals, some of those suffering from this horrific condition may literally be jumping for joy.

For the few that follow this company, most are aware that the scaffold implant in animals was an overwhelming success, as seen here in this video from last year. Of the 44 monkeys used in the study, all of them recovered from their spinal cord injuries and were free from paralysis. In 99.9% of all clinical trials, the public has no access whatsoever to those that are being studied for whatever condition they’re being treated for and obviously that’s why investing in biotech is very risky. The access factor for InVivo would have fallen into the above category had it not been for this local TV news report on November 11th, whereby the surgeon and patient were interviewed about the first-ever surgery.

Invivo therapeutics - Jordan Fallis- Patient No. 1It was disclosed that the first-ever human recipient of the Neuro-Spinal Scaffold implant was 25-year-old Jordan Fallis from Scottsdale, AZ. The interview found Fallis to be very hopeful about his chances for a recovery and his positive attitude certainly took the spotlight. A “Pray For Jordan Lee Fallis” Facebook page was created by his ex-girlfriend and a donation page was created by his mother on the “gofundme” site to help with medical costs, needs and care. In seeing a phone number listed on the “Pray For Jordan Lee Fallis” Facebook page, I reached out to the creator of the page and discovered it was Jordan’s ex-girlfriend. In letting her know that I wanted to reach out to Jordan for an interview and knowing I might also be an encouragement to him since we shared at least two things in common (lower back surgery and motocross), she sent a text to Jordan and alerted him that I would be calling. I waited three weeks before calling, as I wanted to give him some breathing room from the recent media attention and I also knew he was about to move from the hospital into a 1st-floor apartment across town.

When I called Jordan, I found him to be very receptive to my call, as we spent an hour and fifteen minutes on the phone. As was the case in his local TV interview three weeks earlier, he was extremely positive, hopeful and thrilled with his progress. I shared with him my passion for motocross racing as a teenager and the fact that I myself had undergone lower back surgery (L-4 and L-5) as a result of breaking two discs after landing on hard snow (I thought it was powder) from a jump while skiing at Whistler/Blackcomb some sixteen years ago. I told Jordan that people he didn’t even know were rallying around him, as they found his local TV appearance to be incredibly inspiring and uplifting, especially in seeing the positive attitude and courage he displayed after having a life changing event take place in just a split second. He couldn’t believe and was overwhelmed that someone even publicly stated that a new dirt bike was waiting for him upon his being able to walk again. He also expressed his gratitude for those that financially contributed to him through the “gofundme” site.

In talking about the accident, Jordan told me that he was a fairly well known BMX rider in the Phoenix area and that he loved doing tricks on his bike. He stated that he had executed many perfect backflips and that motocross riders in the area encouraged him to take up that sport. Jordan took their advice, got a dirt bike and immediately fell in love with the sport, transferring his skills from the BMX bicycle over to the dirt bike. He and his friends had built ramps and other formations for performing various tricks. When Jordan felt he was ready to execute his first-ever backflip on a dirt bike, he stated that he under-rotated after jumping off the ramp and landed on his head, with excruciating pain to follow.

Jordan stated that he was paralyzed from his belly button down and immediately agreed to the experimental scaffold implant that took place within 24 hours of the accident, the surgery lasting somewhere between 4 to 6 hours. Nearly a month later, he stated in the local TV interview (link above)I’ve already started getting feeling back lower and it’s coming through.

My interview of Jordan took place on December 2nd, three weeks after he spoke with the local TV station in Phoenix. With regard to his recovery, I found what he shared with me to be nothing short of remarkable.


His Progress

Jordan told me that he is thrilled with what the implanted scaffold into his spine is apparently accomplishing concerning his acute spinal cord injury. He says that he is experiencing gradual, but significant progress. The initial paralysis from the belly button down seems to have shifted lower to the area of his upper thighs down. Jordan said the worst thing at first was the inability to control bowel/bladder movements and having to deal with a catheter. He now says that the catheter has been removed, as sensation has returned to the point whereby he’s beginning to feel pressure and thus can sit on a commode and either urinate or defecate on his own. As of the date I interviewed him, he said that he hadn’t had to insert a rectal suppository for bowel stimulation in a week and that “some” feeling had returned to his penis. He also stated that two days before I called, he felt a cold sensation below the knee on his calf when it touched the porcelain surface of the bathtub while he was struggling to get in.

I purposely didn’t mention it earlier in our conversation for the sake of not wanting to elevate his hopes, but after hearing what he told me and feeling very comfortable with our conversation, I asked him how aware he was of the prior scaffold study executed on animals. I specifically pointed out the video (link above) involving the monkey(s). Jordan told me he knew nothing about the scaffold being implanted into the spine of paralyzed monkeys and that he was asked not to explore the internet in search of more information, most likely a gesture by either InVivo, the doctors or both, to prevent him from getting his hopes too high. I asked him if he wanted to see the video and he said yes, thus I asked him to shoot me a text message with his e-mail address after our conversation and I subsequently received his text immediately thereafter.

In concluding our conversation, I wished him well and told him that many people he didn’t even know were praying for him and that I believed prayer is not only answered, but extremely powerful. Obviously being a Christian, that’s what I firmly believe and thus felt comfortable in sharing that with Jordan. I told him that I would check in on him on down the road and he was very receptive to that.

After I wrote the main contents of the article, I called Jordan on Friday, December 12th, as I wanted to read the article to him prior to submitting it for publication. He didn’t answer the phone, so I left a message. In not hearing back from him, I sent him a text message on Monday, December 15th, basically repeating the same message I left on his voicemail and to also let him know that two colleagues of mine had just donated $600.00 to his site on “gofundme.” After still not hearing back from Jordan, I sent his mother a message through the “gofundme” site, once again reiterating the same thing I sent Jordan via voicemail and text. I didn’t hear back from her and then didn’t realize until this week that his grandfather had passed away the day before I called. During our conversation, he did mention that his grandfather was gravely ill back in Iowa and while at first I thought I may have not received a return call or text due to the passing of his grandfather, I now speculate a week later that either the doctors or InVivo may have requested that he and his family not make contact with any potential media source during the remainder of the trial, especially since the company just announced on Tuesday that the FDA just approved expedited enrollment for the ongoing pilot trial, possibly reducing the duration of the pilot trial by up to one year and signaling that there seem to be no safety issues with Jordan’s implant up to this point, the two month mark. I would also tend to believe that they still want to keep Jordan’s high hopes in check, regardless of the amazing progress he’s made to date.

Jordan shared with me how much he misses his work as a gear machinist and how badly he wants to return to the shop. He said that he recently watched his surgery and then told the doctors that he would be happy to be a spokesman for the procedure when the time is right. He told me with confidence, “I’m going to walk again” and that “My goal in six months is to be able to swing my leg back over the seat of my motorcycle.” It was brought up and we even discussed the possibility of him eventually completing that backflip, which just shows you the courage and determination this guy has.

John Harrell


See also:

InVivo Therapeutics (NVIV): Disruptive Technology for Spinal Cord Injuries

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As many as 20,000 people suffer spinal cord injuries annually in the U.S. (CDC estimate) and some 250,000-500,000 people globally (WHO estimate). Many of these people are left with a devastating lack of sensory and motor function below the level of injury- making even simple tasks challenging, if not impossible.

Now, a truly game-changing treatment may be on the horizon from InVivo Therapeutics (web site). InVivo Therapeutics has not only received FDA approval to proceed with clinical trials of their Neuro-Spinal Scaffold, they were granted an expedited enrollment track by FDA to accelerate those trials on December 16, 2014 (press release).

I believe InVivo Therapeutics offers tremendous upside based on reasons presented in this article.


 

 Overview/Share Structure

InVivo Therapeutics logo- croppedFounded in 2005 and based in Cambridge, MA, InVivo Therapeutics is a development stage biotechnology company focused on utilizing polymers as a platform technology to develop treatments to improve function in individuals paralyzed as a result of traumatic spinal cord injury (SCI). InVivo Therapeutics is developing a biocompatible Neuro-Spinal Scaffold to treat acute SCI and biocompatible Neuro-Spinal Scaffold Plus Stem Cells to treat chronic SCI. The company has proprietary technologies and intellectual property licensed under exclusive, worldwide license from Children’s Medical Center Corporation and the Massachusetts Institute of Technology, as well as intellectual property that has been developed internally in collaboration with advisors and partners.

 

Shares Outstanding: 101.6 million
Market Capitalization: Approximately $135 million
Insider Ownership: Approximately 27%
Employee Count: 48
Institutional Ownership: 10.2%
Insider Ownership: 26%
Revenue: (TTM) $0.00
Enterprise Value: $101.8 M (12/18/2014)
EPS: (Adjusted TTM) $-0.01
Analyst Coverage: InVivo Therapeutics currently has only one analyst following it with a $3/share price target
(Source: Thompson/Reuters and Fidelity Investments)

November 2014 Investor Presentation


InVivoTherapeutics-spinal-cord-scaffoldThe biodegradable Neuro-Spinal Scaffold developed by InVivo Therapeutics is surgically implanted at the epicenter of the wound after an acute spinal cord injury.  The scaffold has been shown to facilitate healing to spare spinal cord tissue, decrease post-traumatic cyst formation, and decrease spinal cord tissue pressure in preclinical studies. The Neuro-Spinal Scaffold has received a Humanitarian Use Device designation and is now in clinical trials for the treatment of complete traumatic acute spinal cord injury.

Recent Developments

A very positive development for InVivo Therapeutics was announced last week as the FDA gave the go-ahead for the company to accelerate enrollment in clinical trials of the Neuro-Spinal Scaffold. This is extremely significant, as it speeds up the entire trial period, cutting the enrollment period from 15 months to potentially as low as 6 months according to Senior Pharmaceutical & Biotechnology analyst Jason Napodano from Zacks Small Cap Research (article).

Regarding the expedited enrollment granted by the FDA, Mark Perrin, InVivo’s CEO, stated:

“Over the last calendar year, we have cultivated a collaborative and fruitful relationship with the FDA, and we couldn’t be happier with today’s announcement. Under our new plan, it’s possible to reduce the duration of our pilot trial by up to one year. This, of course, is dependent on patient presentation, but with today’s approval, along with our previously-announced approval of increasing the number of clinical sites up to 20, we are much better positioned to execute and complete this trial in an expedited fashion. Although we cannot predict when subjects will present, we now anticipate full enrollment in the pilot trial in 2015.”

Because the pace toward possible FDA approval for their Neuro-Spinal Scaffold is now faster, InVivo Therapeutics took a leap forward in the time frame for potential commercialization as well.

Chief Science Officer for InVivo, Dr. Thomas Ulich, gave the following presentation on the Neuro-Spinal Scaffold and its use in spinal cord injuries at the 2014 Stem Cell Meeting on the Mesa. 

The presentation is both educational and fascinating.

 


 

Strong Cash Balance Mitigates Risk of Near Term Share Dilution

In May, InVivo completed a round of financing at $1.15/share for $14.6 million in net proceeds and had a cash balance of $17.6 million at the end of Q3. (SEC filing). With $18.3 million in current assets and $4.8 million in current liabilities, the company enjoys a healthy current ratio of 3.8. Management has stated InVivo Theraputics has the cash required for all operations through March, 2016 without additional financing.

In addition to the accelerated clinical trials announced this week, this is another big positive for investors in the company. Uncertainty as to the extent of share dilution and at what price are routine concerns for investors in small and microcap biotech stocks. With InVivo Therapeutics, that risk is greatly diminished for the next 12+ months.

Cash burn has decreased following InVivo’s corporate re-alignment announced in June with expected annualized savings of $3 million and a reduction in cash expenditures of approximately 23% as compared to 2013.  This realignment allows the company to focus exclusively on the development of the Neuro-Spinal Scaffold.


“Miracle” Potential in a Massive Market

For patients suffering traumatic spinal cord injuries, there is no real treatment, no “cure” currently available. Depending on the location and extent of injury, debilitating and life-threatening symptoms are merely managed. Severe thoracic nerve injuries usually result in paraplegia and very little, (if any), control of bowel or bladder…a horrific reality for these individuals. Because trauma is the overwhelming cause of these injuries, the patients are often young adults involved in a motor vehicle crash or a sports-related injury.

As CEO Mark Perrin explained:

“There is nothing out there to help these patients. It’s such an extraordinary unmet medical need that, if successful, the commercialization plans will involve getting the word out to the medical and patient community that this option is now available, and doing everything we can to get the product into hospitals to help treat these patients” (The Wall Street Transcript).

InVivo estimates the worldwide market for treating acute complete SCI to be over $500 million annually and the chronic SCI market to be over $10 billion.

 

Clinical Study Outline

Pilot Study of Clinical Safety of the PLGA Poly-L-Lysine Scaffold for the Treatment of Complete (AIS A) Traumatic Acute Spinal Cord Injury



Disruptive Technology

This is truly disruptive technology for the management of SCI, and if approved by the FDA, the Neuro-Spinal Scaffold would revolutionize the treatment of spinal cord injuries. Should clinical trials in humans come anywhere close to the incredible results in this Must See Video with former CEO Frank Reynolds, “New Technology has Paralyzed Monkeys Walking“, then the current market cap of $135 million will be a fraction of where this company will ultimately trade.


The NVIV chart shows the volatility typical in a disruptive microcap company.  The breakout on 11/12 followed media reports on the first human being entered into the FDA study for the Neuro-Spinal Scaffold, and shows early reaction to yesterday’s news on the expedited enrollment granted by the FDA.
Invivo therapeutics 2 month stock chart


 

Conclusion

NVIV may be a perfect fit for aggressive investors with a high risk tolerance as the company continues down the (often bumpy) road of clinical trials and hopefully, eventual FDA approval of the Neuro-Spinal Scaffold.

Disclosure: I am long NVIV. I have not been paid by any company or third party for this article.

Disclaimer: Opinions expressed are my own and should not be considered investment advice nor an invitation to buy or sell shares of any company mentioned on this site. Investors should perform their own due diligence and consult with a Registered Investment Advisor prior to making any investment decision. See sidebar for full disclaimer.

Rockwell Medical

 

 

Supplemental: On 12/31 I received permission to post this InVivo Therapeutics Research Report from the author, Dr. Jerry Isaacson of LiceSci Capital.


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Rockwell Medical (RMTI) Speculative Buy as January PDUFA Date Nears

 

  • January 24 PDUFA date set for patented, drug with large market potential = near term catalyst
  • Shares may be coming off double bottom formation
  • Completed capital raise in November by BofA Merrill Lynch at 9:00/share for net proceeds of $54.7 million
  • $53 million in ttm revenue from existing operations

 

 

Overview/Share Structure

Rockwell Medical logoRockwell Medical, Inc. (RMTI) is a biopharmaceutical company targeting end-stage renal disease (ESRD) and chronic kidney disease (CKD) with products and services for the treatment of iron deficiency anemia, secondary hyperparathyroidism and hemodialysis.

Founded in 1995 and headquartered in Wixom, MI, Rockwell Medical has 286 full time employees.

Shares outstanding: 46.6 million (following November capital raise)

Insider ownership: 18.6% with 420,000 shares purchased in last 4 months and zero insider sells

Institutional ownership: 22-28% (depending on source)

 

January 24 PDUFA Date for New Drug, “Triferic”

For those new to pharma/biotech stocks, a critically important day is the PDUFA date (pronounced puh-doo-fuh). It stands for “Prescription Drug User Fee Act” and the trading leading up to the PDUFA date is typically volatile.

What’s at stake is huge, as the PDUFA date is the day the FDA votes to approve or reject a new drug. Sometimes, the FDA will rule before the announced PDUFA date, but it’s the day by which a decision is expected.

Triferic is Rockwell’s late-stage investigational iron maintenance therapy for the treatment of iron deficiency in chronic kidney disease patients receiving hemodialysis, and the PDUFA date set for approval or rejection by the FDA is January 24.

While this may not be as exciting as a cure for cancer, the market/revenue implications for Rockwell are big. End Stage Renal Disease (ESRD) is the condition where a patient’s kidneys have completely failed. As a result, patients with ESRD require dialysis treatments several times/week (or a kidney transplant) to survive. There is no cure. Unfortunately, ESRD affects 2.52 million patients globally and is growing 6-8% annually, exceeding population growth rates in much of the world.

The key to understanding Triferic’s potential is that these 2.5 million dialysis patients also suffer from chronic anemia (low hemoglobin levels) and serious (sometimes life-threatening) liver failure. Liver failure in this patient population is most often caused by iron toxicity resulting from the iron replacement therapies currently used to treat the underlying anemia. It’s a real (and expensive) problem for hospitals and renal physicians to manage hemoglobin and iron levels in these patients, and Triferic addresses the problem.

Triferic is administered during the patient’s dialysis treatment and in positive clinical trials has shown to be efficacious in preventing anemia and high iron levels that can lead to liver failure. There were no adverse effects from the drug reported in the studies. Should the FDA approve Trifecta for use in ESRD patients, then I can see widespread use of by physicians to more easily manage their patients.

Moreover, hospitals nationwide have an increasing role in patient treatment modalities. Hospitals nationwide must be accredited by and follow “best practice standards” set by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO). The JCAHO has enormous power in healthcare administration nationwide. If a hospital loses accreditation from JCAHO, they lose their Medicare funding…a devastating blow. While JCAHO may not literally “prescribe” a drug, they can strongly influence its use by making hospitals prove they are using “disease-specific best practices” to lower cost and reduce the average patient length of stay. So a drug like Triferic can become a best practice protocol used by hospitals to demonstrate to JCAHO what they are proactive in reducing patient length of stay limiting expensive complications of anemia and liver toxicity in ESRD patients. These protocols become part of a standard set of orders that physicians who are authorized to practice at a particular hospital must follow.

 

Existing Operations

Risk in RMTI is somewhat mitigated in the fact the company has a 20 year operating history and ttm revenues of $53 million from sales of various solutions and products for dialysis. In October 2014, the company entered into an exclusive licensing agreement with Baxter Healthcare, a $40 billion industry giant, to market their dialysis solutions (listen to conference call). So, unlike a pharma microcap with one product that’s make or break leading up to the PDUFA date, RMIT has several irons in the fire for future revenue expansion.

 

Possible Double Bottom

RMTI shares are volatile and might be making a double bottom formation. With end of year tax-loss sales, support could be broken with new lows made between now and eoy, so caution is advised. In fact it’s possible that RMTI may have broken to new lows by the time this is published.

Rockwell Medical chart

Analyst Estimates

For those who follow analyst estimates, there are 5 currently covering Rockwell Medical. Their average estimate for 2014 is for a loss of .46/share, improving (dramatically) to positive earnings of .24/share for 2015.

 

Suggested Trade

I believe shares have a reasonably strong chance of coming off the bottom here and are likely to move up rapidly by January as the 1/24/2015 PDUFA date nears.

Buy RMTI shares above recent $8.10 low and below $9 with a tight stop loss. Should shares be under $8.10 by the time you read this- you might consider holding off for even lower prices as the year winds down and tax loss sellers complete their exit.

Disclosure: I am long RMTI @ $8.14

Rockwell Medical

 

 

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