TorreyPines Therapeutics: Forget Morale, The Beatings Continue (TPTX)

By Douglas A. McIntyre Published Feb 14, 8:38AM EST

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TorreyPines Therapeutics (NASDAQ: TPTX) has announced its strategic plan for 2008. Unfortunately it doesn’t look or sound very promising.

The company will focus on clinical development activities to maximize the value of the company’s versatile lead compounds, which are AMPA/kainate receptor antagonists tezampanel and NGX426 and muscarinic agonist NGX267. It will conduct a clinical guidance meeting with the FDA in the first half of the year to discuss the efficacy results from a recently completed Phase II trial for acute migraine headaches.

It will also initiate a Phase II trial of tezampanel in muscle spasticity and rigidity secondary to spinal cord trauma in the second half of the year; and it will complete the ongoing Phase I maximum tolerated dose trial of NGX426, the oral prodrug of tezampanel. Torry Pines will also initiate a Phase I single-dose trial of NGX426 in a capsaicin model for neuropathic pain in the first half of the year, and will initiate a Phase I multiple dose trial of NGX426 in the second half of this year. Lastly, it will follow-up on the muscarinic agonist by initiating a Phase II trial of NGX267 in xerostomia, or dry mouth, secondary to Sjogren’s syndrome in the first half of 2008.

After the conclusion of its collaboration with Eisai Co., Ltd. on February 28, 2008, the company "will streamline operations by reducing its work force." President & CEO Neil Kurtz, M.D., will assume oversight of all clinical development programs. Its Chief Medical Officer, Michael Murphy, will leave the company at the end of the month to pursue other interests. For whatever it is worth, biotech companies usually don’t fire people because business is about to boom and chief medical officers don’t usually leave on the eve of a breakthrough on the next potential blockbuster drug.

TorryPines has been public since 1999 and briefly in 2000 this used to be more than a $100 stock when it had hopes of offering a potential treatment for Alzheimer’s. It now sits at $2.00+. The 52-week trading range is $1.80 to $8.75. As of yesterday’s close this one had a $33.8 million market cap and it had $39.7 million on the books in cash on September 30, 2007. Unfortunately its cash burn has been roughly $7 million per quarter up until these "new initiatives." As of last look, this one employed some 43 employees, although that number may have changed and is obviously going to be different.

Since this still has "lead compounds" to focus on we cannot yet call this one a biotech zombie. But it is close.

Jon C. Ogg
February 14, 2008

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.