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SmallCaps Online LLC (Formerly SmallCaps Online LLC) Comments on New Data Presented by ARIAD Scientists at Gene Therapy Conference
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New York, NY, June 16, 1999 — SmallCaps Online LLC (formerly SmallCaps Online LLC) commented today on the recent presentation of data by ARIAD (Nasdaq: ARIA) scientists at the American Society of Gene Therapy Conference held last week in Washington DC. The full text of this report can be accessed at SmallCaps Online’s web site, at www.SmallCapsOnline.com.
Excerpts from the report follow:
Last Friday, ARIA presented exciting new data in an animal model for diabetes. Using a novel gene therapy technology developed in conjunction with Memorial Sloan-Kettering Cancer Center and the University of Geneva, ARIA demonstrated the ability to control the production of insulin, and several other secreted proteins, in mice using a novel small-molecule drug. While still early in development, we believe this represents a large potential opportunity for ARIA both short-term, in its ability to partner the technology, and longer-term, through the multiple therapeutic applications this technology opens up. We continue to believe that ARIA stock is undervalued at current prices and are reiterating our BUY recommendation for those investors tolerant of the risks associated with micro-cap equity investments.
The Background: Unlike ARIA’s ARGENT technology, which uses an oral dimerizer drug to control the production of proteins at the gene transcription stage, this newly presented technology demonstrated the ability to control the release of secreted proteins already produced and stored within the cell. In the case of insulin, ARIA scientists engineered cells to produce insulin bound to a specific inert protein that prevented the insulin from being secreted from a storage compartment within the cell. These engineered cells were injected into diabetic mice that lack the ability to break down blood sugar. These hyperglycemic mice were then given ARIA’s small-molecule drug that cleaves the insulin from the binding protein and allows secretion of insulin into the bloodstream. Within thirty minutes, in response to the newly released insulin, the animals’ blood glucose levels began to fall, and within two hours, the mice were able to achieve normal glucose levels.
The Advantages: While it is still early stage, this technology appears to enable control of protein release much more quickly than with the ARGENT system. This is particularly important for those proteins that require frequent dosing by injection. If successful in humans, this technology could require infrequent gene therapy injections, and then dosing with an oral or sublingual drug perhaps several times per day. ARIA is now optimizing the delivery system used to deliver the genes and hopes to test the technology in larger animals by the end of the year.
The Implications: Although this new technology should be applicable to multiple types of secreted proteins, insulin control, we believe, would offer ARIA the largest commercial opportunity. With an estimated population in the U.S. of over 15 million diabetics, a technology such as this could easily open up licensing and partnering doors for ARIA and provide an additional source of funding to the company.
Conclusion: We continue to be impressed with the depth of ARIA’s technology. In addition, due to its multi-million deal with Hoechst-Marion Roussel in drug development, its involvement in the Hoechst-ARIAD Genomic Center, its ARGENT technology that we believe ARIA is close to partnering, and this additional gene therapy technology, we feel ARIA presents a unique investment opportunity at this time.
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SmallCaps Online LLC is a registered investment advisor focused on identifying emerging growth companies in the healthcare and information technology sectors that offer compelling investment opportunities over the long term. By providing comprehensive financial services, including corporate finance, M&A advisory, strategic partnering and communications consulting, the company positions itself to provide a fully integrated package of value-added services to emerging growth companies.
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The information in this press release has been obtained from sources that SmallCaps Online LLC believes to be reliable, but the Company does not guarantee its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation by SmallCaps Online LLC for the purchase or sale of any securities. SmallCaps Online LLC and/or any of its affiliates has performed investment banking, consulting or other services for ARIA and may solicit investment banking, consulting or other business from, any company mentioned in this release. SmallCaps Online LLC or any of its affiliates or persons associated with SmallCaps Online LLC may at anytime be long or short any of the securities referred to herein and may make purchases or sales thereof while the Company’s reports are in circulation or posted on the SmallCaps Online LLC web site at www.SmallCapsOnline.com. This material, or any portion thereof, may not be reproduced without prior permission from SmallCaps Online LLC. SmallCaps Online LLC is not responsible for the contents of this document that is intended for electronic transmission and could be thus subjected to tampering or alteration. Copyright © 1999 by SmallCaps Online LLC. All rights reserved.