Generex Biotechnology Comments On Recent Trading Activity
March 10, 2008Â
Rodman & Renshaw Analyst Reiterates Market Outperform Rating and $6 Price Target
WORCESTER, Mass., March 10, 2008 -- Generex Biotechnology Corporation, the leader in drug delivery for metabolic diseases through the inner lining of the mouth, commented on trading activity in its stock. The Company believes that the decline in its common stock today is related to the decisions of Eli Lilly and Company as well as Pfizer and Novo Nordisk to discontinue the development of their inhaled insulin products. Generex believes that those decisions enhance its competitive position in the marketplace, as it removes potentially competitive products. Unlike safety concerns related to those products, Generex's proprietary platform technology delivers insulin into the human body through the oral cavity, with no deposit in the lungs. In clinical tests, the drug has always demonstrated an excellent safety profile. Generex recently commenced a Phase III study of its flagship product, Generex Oral-lyn(tm), which is available for sale in Ecuador for the treatment of patients with Type-1 and Type-2 diabetes and which was approved for sale in India in October 2007.
In a research report published this afternoon by Navdeep S. Jaikaria, Ph.D., a Senior Biotechnology Analyst at Rodman & Renshaw, he reiterated his Market Outperform Rating on Generex and $6 price target. Some of the highlights of the report, titled, ``NO IMPACT ON ORAL-LYN FROM LILLY TERMINATION OF ALKERMES INHALED INSULIN'' were:
Alternative Insulin Competitors Continue to Fall and Enhance the Oral-ly Opportunity
Last Friday, Alkermes Inc. (ALKS, Not Rated) announced that it received a letter from Eli Lilly (LLY, Not Rated) terminating their license agreement for the development of AIR Inhaled Insulin. This news, as well as the announcement in October 2007 by Pfizer Inc. (PFE, Not Rated) of the termination of its development of Exubera, an in-market inhalable insulin by Nektar Therapeutics Inc. (NKTR, Not Rated), have continued to place unwarranted pressure on the shares of Generex, which is in the final stages of preparation for a Phase III trial with Oral-lyn, the company's proprietary oral insulin product candidate. We believe disappointing sales with Exubera inhaled insulin made uncertain the prospects for further commercialization of Alkermes' AIR and AERx, an inhaled insulin system by Novo Nordisk A-S (NVO, Not Rated) whose Phase III development was discontinued in January 2008. We believe this news is positive for Generex as they enhance Oral-lyn's opportunity as a safe, more tolerable, non-injectable insulin for the treatment of patients with diabetes.
We Reiterate that the High Hurdles with the Inhaled Route of Insulin Delivery are Not Likely to be Observed with Buccal Cavity (Oral) Delivery of Insulin
Concerns continue to grow that inhaled insulins, such as Exubera, may all be plagued by the observation of an early, non-progressive decline in lung function that does not improve over long-term use of Exubera, as well as problems associated with formulation of insulin into inhalable powder form. Further, the advancement of more convenient injectable devices, such as pens filled with pre-mixed insulin analogs, obviated the value of convenient mealtime titratable insulin delivery. We believe the significant hurdles seen with the inhalation route of delivery bode negative for inhaled insulin products, and open the door for Oral-lyn as the insulin potentially with the best non-injectable alternative route of mealtime insulin delivery.
Generex is engaged in the research, development, and commercialization of drug delivery systems and technologies. Generex has developed a proprietary platform technology for the delivery of drugs into the human body through the oral cavity (with no deposit in the lungs). The Company's proprietary liquid formulations allow drugs typically administered by injection to be absorbed into the body by the lining of the inner mouth using the Company's proprietary RapidMist(tm) device. The Company's flagship product, oral insulin (Generex Oral-lyn(tm)), which is available for sale in Ecuador for the treatment of patients with Type-1 and Type-2 diabetes and which was approved for sale in India in October 2007, is in various stages of clinical development around the world. For more information, visit the Generex website at http://www.generex.com.
Safe Harbor Statement: This release and oral statements made from time to time by Generex representatives concerning the same subject matter may contain ``forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by introductory words such as ``expects,'' ``plans,'' ``intends,'' ``believes,'' ``will,'' ``estimates,'' ``forecasts,'' ``projects'' or words of similar meaning, and by the fact that they do not relate strictly to historical or current facts. Forward-looking statements frequently are used in discussing potential product applications, potential collaborations, product development activities, clinical studies, regulatory submissions and approvals, and similar operating matters. Many factors may cause actual results to differ from forward-looking statements, including inaccurate assumptions and a broad variety of risks and uncertainties, some of which are known and others of which are not. Known risks and uncertainties include those identified from time to time in the reports filed by Generex with the Securities and Exchange Commission, which should be considered together with any forward-looking statement. No forward-looking statement is a guarantee of future results or events, and one should avoid placing undue reliance on such statements. Generex undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Generex cannot be sure when or if it will be permitted by regulatory agencies to undertake additional clinical trials or to commence any particular phase of clinical trials. Because of this, statements regarding the expected timing of clinical trials cannot be regarded as actual predictions of when Generex will obtain regulatory approval for any ``phase'' of clinical trials. Generex claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act.