Questions came up on Tricida (TCDA), so I thought that I would post my answers for everyone. TCDA makes a non-toxic polymer that absorbs stomach acid without increasing the salt in the chronic kidney disease patient’s bodies, a super important benefit. For you chemistry people, it is a polymer that converts an amine to a quaternary ammonium chloride moeity in the presence of acid. This would be a critical therapy for CKD patients, and there is no alternative.
FDA NDA Goal Date: 8/22/2020
Key Patent: US 9,205,107 Expires June 23, 2034
Peak Sales Estimate from S-1: $1.5B
Current Market Cap: $1.4B
Approximate Purchase Value: $11.2B Typically companies sell for 8X peak sales estimates.
Key Results: With 93 person legs, 4 placebo patients died from CKD, all treated patients lived. 10.8% of placebo patents lost kidney function > 50%, while only 4% of VEVERIMER patients lost kidney function > 50%. For all of the thousands of people that have CKD, this seems like a small test to me.
TCDA has passed a small Phase 3 test. They believe that they will initially have around 550,000 patients. Importantly, TCDA is a one trick pony. Their drug VEVERIMER (aka TRC101) is their only product.
Key Question: Why hasn’t their stock price moved??? This stock has done nothing, even with the positive Phase 3 results. I have no idea why this is the case.
This seems like a tremendous value. Typically, one trick ponies get purchased by larger pharmaceutical companies.
Things that could go wrong.
The polymer adversely affects the gut microbiome.
I would think that the Phase 2 and Phase 3 testing would have to establish safety with respect the microbiome, but I have not found anything related to this.
There is a manufacturing concern.
This is not a biologic, so manufacturing is probably a lower risk proposition than those technologies
The benefits seen in the smaller phase 3 results do not materialize with a larger population. Becuase this drug is based on such a primitive and well known chemistry, I would be shocked if this doesn’t work. The idea of taking a nontoxic antacid pill, that completely absorbs the acid, and leaves in the patient’s poop, seems straightforward to me.
The price recently dropped due to a convertible notes offering. From the press releases, the company is staffing up in preparation for selling this drug. I would not be surprised if TCDA is purchased at any time.
PS I picked up on this off of the Biotech board, although this is not a biologic treatment. I think Fuma is the one who first highlighted this company.
PPS Long TCDA 3.4%