Friday, March 18, 2011

InterMune's Esbriet: Hype or Miracle Drug?

InterMune’s (ITMN -$44.00) internal forecasts for its new pulmonary fibrosis drug appear even more bullish than Wall Street, with management pegging the market opportunity for Esbriet in the top 10 EU countries as high as $3 billion.

Both internal and Wall Street sales projections could prove too optimistic, however, considering the global idiopathic pulmonary fibrosis market was valued at $88 million in 2009 (nominal sales don’t recognize off-label RX use, but do underscore a market underserved due to a lack of approved products). Nonetheless, even with new growth drivers, such as Esbriet and other novel treatments in development, from LPA1 receptor antagonists to protein inhibitors, the combined U.S. and EU market for IPF is expected to climb no higher than about $462 million by 2017, according to industry analyst BioPortfolio.

As in Greek mythology, where Icarus ignored the warning of his father Daedalus, this unbridled optimism surrounding Esbriet runs significant risk of flying too close to the sun. Is hype outdistancing hope?

Continue Reading at CBS Interactive....

Editor David J Phillips does not hold a financial interest in any stocks mentioned in this article. The 10Q Detective has a Full Disclosure Policy.


intrinsic said...

love the Greek mythology analogy!

Elliot Walsey said...

The income projections for Intermune are actually on the low side.
The lower estimates are based on flawed information relating to the number of victims and deaths caused by Pulmonary Fibrosis.
For example,the number [40,000] recorded deaths a year is based on old info which only used death certificates that stated Pulmonary Fibrosis as the cause of death.
the reality is that most victims of PF die of heart failure. When the lungs cannot supply enough oxygen the heart tries to make up the deficit and overworks and ultimately fails.
The true amt. of deaths could easily be 2 3 times the used number.
Next, the figure of total US victims of about 128,000 is incredibly off the mark.
Again, it's based on old out of date info. From current real facts we know that we're getting 48,000 new case EVERY YEAR. Just do the math.
The unfortunate reality is that this often mis-diagnosed disease is probably undercounted by a few hundred thousand unfortunate people.
Other than some random lung transplants [which have a 35% 5 yr survival rate] the true survival rate is ZERO.
If you use these figures for Europe the market is enormously profitable.
After all the stated cost of maintaining victims is $50,000 per yr. just multiply that figure X every 1,000 victims and you get some idea of the real numbers. Elliot Walsey