AmcOx press release

A recent financial study from Goldman Sachs has initiated the coverage of Nicox with a Sell rating and a price target of 3.2 euros. They forecast that Naproxcinod, the phase 3 leading compound of NicOx, will only reach a peak sales of US$ 530 mn.
The date chosen to publish this study is quite surprising as it has occurred about one month before a crucial publication of study 302 which could confirm the therapeutic potential of Naproxcinod. Furthermore, the Goldman Sachs analyst does not appear to be part of the regular analysts on Nicox.
That could explain that the study contains several and important misleading statements. Therefore, AMCOX, which is the association of individual shareholders of NicOx, is willing to publicly underline these mistakes.

1) The patents covering Naproxcinod lasts until 2019 including SPC extension in Europe. Considering that Nicox will launch the product at the end of 2010, the analyst assumes that this length could not be enough to give Nicox sufficient profits, regarding massive marketing investments. That is the reason why he concludes that only a specialty pharma company could sign a deal with Nicox. That schema might constrain Nicox to raise funds to strengthen its position during the deal.
This affirmation does not appear to be relevant. Indeed, a partnership with smaller pharmaceutical actors may be more productive in terms of rentability and profits rather that a deal with a major pharma.

2) According to the analyst, Naproxcinod has not made relevant differences to blood pressure compared with Naproxen. Some studies could even show that Naproxcinod might lead to an increase of blood pressure.
In fact, these studies have not been done to collect data on blood pressure, but on gastrointestinal (GI) effects (Hawkey et al, Gut, 52, 1537-1542 (2003)),on renal effects (Huledal et al, Clin Pharmacol Ther, 77, 437-450 (2005)) and on pain (Lohmander et al, Ann Rheum Dis, 64, 449-456 (2005)). Blood measurement data has been collected without any strict methodology as it was not one of the principal criteria of these studies. For example, in the Schnitzer study, the time between the administration of the drug and the blood pressure test was not controlled and therefore reproducible. Furthermore, several studies (Hawkey, Lohmander) have been done with endoscopic tests to control GI effects. However, it has been clearly established that endoscopies increase blood pressure and the heartbeat (Yagi & al – 2005, Ristikankare & al – 2006, Mori & al – 2008). As a result, these studies cannot be used to compare the effects of Naproxcinod on blood pressure. The small number of patients do not allow anyone to draw results from these data. Only the Lohmander study had a larger sample but it was done with endoscopies. The approach of the analyst is clearly not scientifically proved given that he is trying to collect physiological data from studies without such goals. This kind of approach could lead to disqualify any pharma company towards regulatory authorities.
Regards with the blood pressure variability, it is inherent of human nature and it has be seen in every clinical studies including those concerning anti-hypertensive drugs. That is why a large number of patients is needed to draw significant conclusions.

3) The analyst considers that a BP decrease of 2 mmHg versus Naproxene is not clinically significant and it might not be interesting for regulatory authorities.
However, it is scientifically established that even a limited decrease of blood pressure could lead to avoid numerous deceases.
- A 2 mmHg BP decrease could lead, in the United States, to a decrease of 6% of global mortality rate for heart attacks, of 9% of coronarian troubles and of 7% of every mortality causes (Chobanian AV. & al, Hypertension 2003).
-A decrease of 2.26% of systolic tension (3.1 mmHg for a 140 tension) in the 11.1 millions hyper-tensive Americans could lead to save 86000 human lives and save US$2.4 bn of direct medical costs (Grover & al, Hypertension 2005).
The affirmation of the analyst, saying that a diminution of 2 mmHg might not have any interest for regulatory authorities, does not appear to be relevant. All available data underline the contrary.

4) According the analyst, naproxen label notice has no warrning in relation with hypertension.
In fact, since 2006, the FDA asked for the notification of the risk of hypertension with Naproxen.
NSAIDs may cause an increased risk of serious cardiovascular thrombotic events, myocardial infarction, and stroke, which can be fatal. This risk may increase with duration of use. Patients with cardiovascular disease or risk factors for cardiovascular disease may be at greater risk (see WARNINGS).
Naproxen as NAPROSYN, EC-NAPROSYN, ANAPROX, ANAPROX DS or NAPROSYN Suspension is contraindicated for the treatment of peri-operative pain in the setting of coronary artery bypass graft (CABG) surgery (see WARNINGS).

5) The analyst underlines the fact that the Naproxcinod may have some unknown secondary effects. This could be affect any new drug. However, the 301-study has shown fewer secondary effects versus Naproxen. As a result, this argument could not be relevant.

Finally, the 12-month price target of 3.2 euros does not seem to be realistic. There is no mention of the methods which have been used for this estimation. The intellectual property and the exclusive global commercialization rights of therapeutic compound at the end of clinical studies is paid 2 or 3 times its peak sales. If Nicox changes drastically his mind and wants to sell completely its product property, the fair value of naproxcinod would be from 14 to 20 euros a Nicox share. Without taking account of any product development except Naproxcinod and with net cash around €100 mn, the fair value of Nicox in 2009 could be between 16 and 22 euros a share.

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