Tuesday, December 16, 2008

Anesiva's Good Adlea Results

I trashed Anesiva management for not keeping investors informed of its problems with manufacturing Zingo [See Anesiva (ANSV) Drops Zingo].

Yet I felt the market reaction to the discontinuance of Zingo was overdone. Why? Because the majority of the future value of the company was always in the potential of Adlea.

Adlea a simple, long-term painkiller that is dripped into surgical wounds. It appears to have no side affects and keeps pain down for weeks. It allows patients to cut back on their use of morphine. The FDA is reputed to be eager to have a non-addictive, surgical wound specific analgesic on the market.

Adlea has had a lot of clinical trials now, including Phase III trials. Overall it has done well, always showing pain reduction, but in some specific uses or test runs not quite hitting its endpoints. The latest test results [See Anesiva Adlea press release] met the endpoints for total knee replacement surgery.

Adlea's problem now is that they ran through their cash after they got FDA approval for Zingo. So they don't appear to have the cash required to get Adlea to market. They need a partner, because in this market you can't issue new stocks or bonds even if you have a blockbuster winner like Adlea sitting in your lap. Another possibility would be a buyout from a larger pharma company.

Sometimes other companies are willing to let a winner die on the vine, either to prevent competition or to pick it up even cheaper later. There's no telling how this would play out. Normally I'd say Anesiva (ANSV) is worth large multiples of its current market capitalization, but that depends on money coming from somewhere to get Adlea approved and marketed.


My Anesiva page

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