E Sunshine And Grouses

*Three tasks were performed during Tuesday's presentation of GlaxoSmithKline (GSK) R&D outlook. Firstly, the call for GSK to be split up, coming from a UK drug analyst, was rolled back by predicting that there would be 20 new major drugs coming to market by 2020. Then too, the thesis that former academic Sir Andrew Witty had been outsmarted by Novartis (NVS) when he sold GSK's oncology pipeline to the Swiss firm could be countered by stressing new promising cancer therapies GSK had mostly acquired from outsiders since the deal. And turning down the bid from Pfizer (which would have resulted in enormous paper gains for GSK shareholders) had to be justified by focus on the in-house prospects.

British top analysts are less than convinced by Witty and his team. JP Morgan Cazenove rates GSK neutral with a target price of GBX 1370. Deutsche Bank has a higher TP, GBX1500, but the same rating. I have not yet written up my copious notes.

*Galapagos (GLPG) replaced a departing lady scientist on its board with another, Christine Mummery, who is a British trained professor of biology and embryology at Leiden University in The Netherlands. She was a Radcliffe fellow (sic; my former college is very backward) 8 years ago and worked on induced pluripotent stem cells.

*CEO Anat Cohen-Dayat's remarks over results at Iraeli drug discovery firm Compugen (CGENon Tuesday. The results were extremely badly transcribed by the partly Israeli-owned www.seekingalpha.com website. When she said “Compugen patents” the SA text read “competent patterns”, a sign the transcribers had no idea what they were listening to. I could not attend the cc because I was at the GSK R&D day. Apparently companies pay to have their cc's transcribed. And they are copyrighted so you cannot quote huge slabs of them.

What she was talking about was updates to the August deal with Bayer on immune checkpoints to treat cancer using two Compugen-patented antibodies, 1501T which is the more advanced; and 15022 which is proving “promising” as it has a novel mechanism of action which can boost cancer immune response. CGEN and BAYRY agreed that they are “excited” by the “progress toward potential novel therapeutics for cancer immunotherapy”, she added. “Each present a distinctive differentiation” vs already known checkpoints” having “potentially different mechanisms of action” to induce immune responses to treat cancer.

This is important and matters far more than the weak earnings numbers. But it was so garbled in the transcript I had to guess what she was saying. Dr Cohen-Dayat has an Israel accent but so do many of the founders of seekingalpha.com so there is really no excuse. The transcribers, who may have Indian accents, need a vocabulary list and must know the name of the company paying their bosses.

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