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The Sirflox trial – A perspective on the Study Abstract. Part 1.

By Kenneth Robson on May 17, 2015 • ( 1 )

Disclaimer

With a medical background I have taken an interest in some stocks in the Biotech, and Health Care sectors. I do not now have a shareholding in Sirtex, but might in the future. I am mostly a long-only, medium-term investor. My interest in Sirtex is an academic one after a fellow “Ten Bags Full” contributor had sought opinions on the stock.

Although biotech stocks offer the promise of large and sometimes quick profits, the venture capital required by start-up companies is high-risk for retail investors, who should seek professional advice before allocating their capital. As a rule, this sector should be the province of institutional, large private investors, and short-term traders.

This post does not provide investment advice, but in this instance, it seeks to aid readers to better understand the medical aims of this clinical trial, and what it may mean for the future of the company. It seeks to highlight objective information to help retail investors with their own research.

The opinions expressed are my own, based on my reading. I have no personal experience with the management of secondary cancer of the colon and rectum with SIRT (Selective Internal Radiation Therapy). I seek to explain in an understandable way, the findings thus far of the Sirflox Trial and would welcome feed-back drawing my attention to any incorrect statements I may make.

CEO Mr Gilman Wong This post comments on the announcement by Sirtex 14th May 2015 on the release by the American Society for Clinical Oncology of the Study Extract of the Sirflox trial, to be presented by Associate Professor Peter Gibbs at the ASCO Annual Meeting May 30 in Chicago. The Moderator will be Professor Ricky A Sharma from the Gray Institute for Radiation Oncology, University of Oxford. References:

B Miracle man for Sirtex Gilman Wong

Back in February Gilman Wong expressed a wish to see Sirtex capitalise on its position with $50 million cash, and a debt-free balance sheet, to pursue a policy of acquisitions of biotech stocks that had completed trials, and were ready for commercialisation. This would allow Sirtex to continue to grow through acquisition as well as by expansion of its present business.

Since its start Sirtex has been a one-product company, using radio-active Yttrium 90, embedded in microscopic ceramic spheres to treat primary and secondary liver cancerous tumours. The dose has to be carefully assessed according to the body surface area, the size of the tumours in the liver, and the likely extent of spread to the lung. The procedure is technically demanding requiring an interventional radiologist to pass an arterial catheter into the appropriate hepatic artery branches supplying the tumours. The liver has great capacity for regeneration but if the tumours are diffuse, the associated liver damage from the treatment may make the therapy too risky.

Over the past 15 years Sirtex has seen steady growth in the use of SIR-Spheres. It is estimated that there have been 50,000 doses carried out in 800 centres in that time. The price for the therapy I believe is about $15,000 per dose. Mr Wong advises that current business is continuing to grow with global dose sales increasing 22% in 10 months of this financial year. In 2014 there were 8561 dose sales with total revenue of $129,363,000 and a NPAT of $28.868 million.

The other avenue of growth is internal expansion by finding new applications for the SIRT technology. At present liver tumours are often surgically resected if feasible, in preference to SIRT technology, whilst non-resectable metastases are managed with a basket of chemotherapy agents. The SIRFLOX trial, conducted over the past seven years seeks to promote the use of SIR-Spheres as the first option over surgical resection, in association with chemotherapy for the management of metastatic colorectal cancer. Other clinical trials in which the company is participating to test the applicability of SIRT, are the following malignancies:

Ocular melanoma
Neuro-endocrine tumours
Hepatocellular carcinoma (primary liver cancer)
Cholangio-carcinoma (bile-ducts)
Secondary tumours in the liver from sites other than from the gastro-intestinal tract.

This list would suggest that there is plenty of scope for further growth in dose sales.

In Part II I will review the study results thus far.