Tag - Eln

Small-cap stocks slipped into the red shortly after the open, pulled down concerns over a four-year high in the unemployment rate and by massive losses posted by U.S. manufacturing icon General Motors Corp. (NYSE:GM), which only stirs the pot on economic fretting. At 9:51 a.m. ET, the Russell 2000 (NYSE:IWM) was down 4.91, or 0.69%, at 709.62.

Investors and analysts continue to grapple with the mixed details seen on today’s monthly Labor Department employment report. The “headline” figure for non-farm payrolls came in at minus 51,000, which was better than the consensus forecast for a loss of 75,000 jobs. There was some trepidation that the non-farm figure could swell beyond the forecast after Thursday’s dreadful weekly claims report (which was taken after the monthly jobs figures were gathered). The initial response to the non-farm payrolls figure was a six-handle bounce in S&P 500 futures, a firming of the dollar against the euro and a rise in Treasury yields. However, the devil is in the details, and today’s jobs report was not without some troubling aspects.

The most obvious concern on the report was that the nation’s unemployment rate rose beyond expectations, climbing to 5.7%, which marked the highest level in more than four years. In addition, the number of people working part-time for economic reasons rose by 291,000 and has increased by 1.34 million, up 31.5% over the past year.

“Over the past year, the number of unemployed people has increased by more than 1.6 million and the unemployment rate has increased by a full percentage point. In the post-World War II period, every time the unemployment rate has jumped by a full percentage point in the course of a year, the economy has slipped into . . .

Small-cap stocks are expected to open higher, underpinned by surprisingly stout employment figures on this morning’s ADP Employment Report. The Russell 2000 (NYSE:IWM) was up about 0.3% in after-hours trading, which suggests an open near 716.50.

The ADP headline figure for non-farm payrolls came in at plus 9,000 jobs, which was a big surprise over the projection for a decline of 58,000 jobs. The immediate market response to the ADP report was a rally in the U.S. dollar, a decline in Treasury futures and a four-handle upside pop in S&P 500 futures. Although the ADP report has been less accurate in forecasting the Labor Department’s monthly employment release over the last year, the move into a positive number should provide a little more optimism about the employment picture heading into Friday’s big report.

Also on the data front, the MBA Mortgage Applications Survey came out this morning and was down 14.1 to the lowest level since December 2001. The combination of weak home sales and slumping home equity continue to take a toll on mortgage applications.

Crude oil futures were hovering near $122 dollars a barrel this morning, down just a tad from Tuesday’s close and basically marking time ahead of the weekly inventory report later this morning, which is expected to show a 200,000-barrel . . .

Bette Davis once said “old age is no place for sissies,” and to a degree, she was right. Old age not only brings wrinkles, but serious diseases such as Alzheimer’s and diabetes. Two drug companies that want to make the transition into your golden years a bit more tolerable are Transition Therapeutics Inc. (Nasdaq:TTHI) and Sirtris Pharmaceuticals Inc. (Nasdaq:SIRT).

Both companies have ample cash for funding further development efforts and have made noteworthy progress over the last year advancing lead compounds. While Transition and Sirtris are likely several years away from commercial sales, their drug candidates address huge, growing markets, estimated at hundreds of millions of patients worldwide, and have significant future revenue potential. 

Transition is developing novel drugs for treating Alzheimer’s disease and Type 2 diabetes. Its lead compound, ELND005, for the treatment of Alzheimer’s disease, works by breaking down neurotoxic fibrils in the brain and allowing certain peptides to clear the body before they can form plaque. Alzheimer’s disease is the fourth leading cause of death among U.S. adults and has no cure; it begins with memory loss and eventually progresses to overall loss of cognitive function. Most Alzheimer’s patients die within eight years of diagnosis. More than 30 million people worldwide currently suffer from the disease and their numbers are expected to increase dramatically as the number of seniors grows.

The company is partnering with Elan Corporation (NYSE:ELN) to develop and commercialize ELND005. Phase II clinical trials of the drug involving some 340 patients with mild to moderate Alzheimer’s disease began last December and are expected to last approximately 18 months. To help fund the trials, Transition received milestone payments from Elan totaling $7.5 million last October and $5 million this January.

Transition is also developing TT-223 for the treatment of Type 2 diabetes. TT-223 works by regenerating the body’s insulin-producing cells. Diabetes is the world’s fastest-growing disease; there are more than 200 million diabetics worldwide and it is estimated one in 10 patients will eventually die from complications of the disease. Type 2 diabetes accounts for 90% of all cases and usually develops in adulthood. Transition is partnering with Eli Lilly & Co. (NYSE:LLY) to develop and . . .

Javelin Pharmaceuticals (AMEX: JAV) is all about controlling pain. The company now has three products it is planning to introduce in upcoming quarters, and approvals would not only ease patient suffering but give investors relief as well.
 
Based in Cambridge, Mass., Javelin is an emerging specialty pharmaceutical company that searches out unmet and underserved needs in pain management. Incorporated in 2005, Javelin’s three product candidates are designed to better relieve pain with fewer adverse side effects and faster results than other treatments. The company has successfully retained intellectual property rights on these products, extending the term of commercial exclusivity.

Rylomine, or intranasal morphine, is one product in Javelin’s pipeline. It is in Phase III development in the United States for acute moderate-to-severe pain and in Phase II studies in Europe. Rylomine works faster than oral morphine and does not require professional medical assistance, as injected morphine usually does. A second product is PM-150, or intranasal ketamine. A formulation of ketamine, a non-opiate, the product is in Phase III trials in both the United States and Europe.

It’s the third offering—Dyloject—that’s of the moment. Dyloject is a formula for injectable diclofenac and is in a Phase III trial in the United States and awaiting approval in the U.K. Diclofenac, an NSAID, is widely prescribed for post-operative pain. Dyloject is in development in the United States for post-surgical pain; in the U.K., it additionally targets acute pain.

The wait for regulatory approval of the U.K. plant for Dyloject has put investors on edge. Originally hoped for by the end of summer, it is still expected soon: in late September at the UBS Global Life Sciences Conference, Fred Mermelstein, founder and president, said the company expects approval in the near term and plans for a U.K. commercial launch in the fourth quarter. Javelin has been hiring sales people for the rollout, which is expected to extend into the EU in 2008.

Just this month, Patricia Bank, analyst at Pacific Growth Equities, said in a research note that she fully expects the Dyloject manufacturing plant to be approved. “However, after speaking with industry consultants, we are resigned to the possibility that the agency may request additional minor corrective actions,” she said, adding that this would be routine practice.