Antares Pharma Inc (ATRS): A Critical Look

Page 1 of 2

Recently, I enjoyed an article contributed by Adam Feuerstein (“AF article”) regarding Antares Pharma Inc (NASDAQ:ATRS) and its transformational product Otrexup. Here, I would like to present my views on the following items debated in the AF article: (1) sufficiency of data submitted to FDA, (2) marketability and sales of Otrexup, and (3) Antares Pharma Inc (NASDAQ:ATRS)’s market capitalization and its buyout potential.

Otrexup is a drug-device combination currently seeking FDA approval to become the first and only self-injectable methotrexate (MTX) device that can be used by rheumatoid arthritis (RA) patients at home. I refer interested readers to my previous article on Otrexup for a very detailed analysis.

Sufficiency of data submitted to FDA

AF article states that very little data have been presented and published by Antares Pharma Inc (NASDAQ:ATRS) on Otrexup. Since Otrexup is a drug-device combination product, its regulatory pathway for approval is managed by the Office of Combination Products, or OCP, division of the FDA.

OCP issued a guidance to clarify the data requirements for injector drug-device combinations seeking approval. According to the OCP guidance the applicant needs to submit data showing that the intended user group can safely and effectively use the injector. Antares Pharma Inc (NASDAQ:ATRS) submitted data from its “Human Factors Usability” and “Actual Human Use” studies.

Furthermore, if the injector is prefilled with a certain drug, OCP requires a pharmacokinetics study comparing the new injector to an approved route of delivery. Note that Otrexup changes the route of injection from intra-muscular (IM) to subcutaneous (SC). Antares conducted two pharmacokinetic studies to satisfy this additional requirement by comparing Otrexup against oral administration and IM injection.

OCP also encourages meetings to clarify case-specific data requirements. Antares Pharma Inc (NASDAQ:ATRS) had numerous meetings with OCP: 2011 meeting to confirm regulatory pathway, pre-submission meeting in 2012, and mid-cycle review meeting in 2013, all of which went smoothly.

Additionally, Antares submitted the results of numerous European clinical studies showing the benefits of subcutaneously injected MTX over oral administration, as supporting evidence. Note that, SC injection of MTX has been already approved and widely used in Europe and Canada.

Marketability and sales of Otrexup

AF article states that Antares is likely to face skepticism from all sides: “Doctors won’t have any efficacy data on Otrexup so may not rush to prescribe. Insurance companies could be slow to accept Otrexup”.

I completely disagree. Antares as well as many European clinical studies (see slide 10) established that SC injection has better efficacy than oral forms, as the systemic bioavailability of MTX is higher especially at higher doses. Antares Pharma Inc (NASDAQ:ATRS) already referenced such studies in their FDA application.

Better efficacy is not the only reason for superiority of Otrexup over oral tablets. European studies also established that since oral tablets have to go through gastro-intestinal tract, they cause many more side effects and the amount of oral medication that is absorbed into the blood varies greatly among patients, i.e., notorious “variable absorption” problem.

Secondly, Otrexup will grab massive market share from IM injections for many reasons as detailed in my article. Insurance companies will happily switch patients from IM injection to Otrexup to eliminate the cost of weekly office visits.

Thirdly, insurance companies would be interested in keeping patients longer on MTX before switching to expensive biologics, which can be achieved by the higher systemic bioavailability of MTX, thanks to Otrexup.

Antares’s market capitalization

After raising questions about data quality and marketability of Otrexup, AF article states that Antares’s market cap already exceeds $500 million. Market cap of Antares has been the biggest bear argument, i.e., 23 million in sales with half a billion in market cap sounds like over-valuation.

Bears fail to realize that a savvy investor doesn’t buy Antares for its current sales, but rather its future billion dollar revenue potential driven by Otrexup, testosterone injector, three marketed products, and eight other pipeline products. Their Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) partnership alone is developing drug-device combination products worth $3 billion in US sales. Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) is familiar with the superiority of Antares injectors, especially when selling highly generic drugs in competitive markets, e.g., Teva increased its sales of human growth hormone from $20 million to $100 million after switching to Antares’s injector.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Best Travel Destinations in Australia

World’s Most Expensive Musical Instruments

World’s Most Famous Animals

Most Expensive Cakes in the World

Most Expensive Kosher Champagne in the World

Most Expensive Kosher Wine in the World

The Most Surprisingly Dark Fairy Tales

Most Popular Travel Destinations in Asia

The 10 Most Expensive Dresses Ever Worn to the Oscars

World’s Most Visited Art Museums

Best Countries for Photographers to Work in

Best Paid Jobs in the Film Industry

The Most Renowned Recovered Paintings Ever

Child Stars That Turned out Just Fine

Books That Were Banned in the Past Century

World’s Richest Dancers

Best Remedies against Bad Breath

Foods That Improve Your Skin Texture

Best-Selling Children’s Books of all Time

Foods That Boost Your Libido

Best-Selling Books of all Time

The Most Expensive Academy Awards Jewelry in History

Most Expensive Japanese Restaurant In New York City

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!