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A biopharmaceutical company focused on the research, development and commercialization of pharmaceutical products that address unmet medical needs in the acute care environment.
This company make a drung called Daptomyocin. The drug is affective against MRSA and is used internationally for skin infections and bactermia. In many ways ths drug is a heavy hitting antiboitic used has last line of defense in the hospital setting. The drug is last line because it is theorized that gram positive bacterium like MRSA should be able to evolve quickly to be 100% drug resistant. Further this company continues to be late with deliveries to hosptials nationwide. That combined with several recent questionable buys of small biotech firms makes this stock a underpreform for the short term and potentially the long term.
It was my belief that this drug was used in last line because the first line (vancomycin) is so darn cheap but usually ineffective. This is the first I've heard about late hospital deliveries, but I'm confused how that will effect total sales of the drug rather than just timing
late deliveries won't affect sales... people will still need the drug. Vancomycin has been used too much and for so long (which is why its so cheap now -- a very mature manufacturing process) that there is a decent amount of resistance built up. As this resistance to Vanco builds Cubicin will become the frequent alternative. Cubicin is expected to peak to ~1 billion US annual sales. That's a lot of room for rev growth, and this product is PROVEN many times over. Also, margins may improve as the manufacturing process matures.
While MRSA is capable of becoming resistant to virtually all antimicrobials, daptomycin resistance in S. aureus is extremely rare (0.01-0.1%) and does not show any sign of increasing in prevalence. New data show that daptomycin is more cost-effective (even though the drug cost is higher than vancomycin) and may actually have a mortality benefit over vancomycin for serious infections. in other words, daptomycin failure should not even cross your mind as a reason to not invest in Cubist.
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