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Sirtex: An education

Sirtex: An education

 

I recently came across this excellent animated educational video produced by Sirtex Medical US, showing how their core medical device, SIR-Spheres, are delivered to inoperable tumours in the liver.

After watching this demonstration and gaining a better understanding of the treatment and its delivery, what should become clear is that there are other organs in the body that can be treated through a similar method.

In time, the possibility exists (if Sirtex can gain approval from the necessary regulators) for SIR-Spheres to also be used in treating cancerous tumours in the brain, lungs and even kidneys. Essentially: any site where there’s potential for the device to be delivered directly through a catheter or artery.

In regards to kidneys, for the first time Sirtex updated the market the other day on their clinical study of SIRT for the treatment of renal cell carcinoma (RCC) – the main type of cancer affecting the kidney. The update can be read here.

Whilst such an application has a much smaller potential market than the metastatic colorectal cancer of the liver, the announcement gives further indication of Sirtex’s exciting device being able to be used for other sufferers of this insipid disease. It’s yet is another step in the right direction.

This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.

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8 Comments

  1. Thanks Russell!
    Yes I understand the differences and that there is no direct correlation. Thought is was nice ‘validation’ from a reasonable number at a single centre for the existing treatment.

    Who from RM will be attending the AGM tomorrow?

    • We have decided not to because they have basically been flagging everything very well. We are expecting dosage production to rise from 8,600 in FY13 to about 11,000 this year and then towards 36,000 from the facilities in Singapore, Boston and Frankfurt.

      Post Script: Just read the announcement and transcript. As expected 28% dosage sales growth to just over 11,000. The really interesting aspect is if demand for dosage sales exceeds capacity of 36,000 (approx. $500mln revenue) then the cost of the next 36,000 doses (and an additional $500mln of revenue) is just $20 million.

      • Roger – thanks for taking the time to reply! The AGM was worth the time, for me.

        If you have a few minutes, I was interested in your comment….
        ‘ The really interesting aspect is if demand for dosage sales exceeds capacity of 36,000 (approx. $500mln revenue) then the cost of the next 36,000 doses (and an additional $500mln of revenue) is just $20 million.’

        Maybe I’ve missed some data but the only way I can get to these sorts of numbers is if the plants ramp up their output from the ~45 doses per day @ 3 days a week, to ~90 per day, or working a 6 day week. Or some combination of same.

        Appreciate anything you are comfortable to share with us. But will be very happy to see 30,000 doses as an interim number :-)

      • The manufacturing facilities in Boston, Frankfurt and Singapore have capacity of 30,000 doses. Here’s a quote from Dr David Cade, Chief Medical Officer; “Our plans for the future involve creating the capability and capacity to meet demand. A key element of this strategy involves expanding our manufacturing. Sirtex is currently working to triple its manufacturing capacity with new facilities in Germany and the US to better serve our global customers.”

      • Thanks Roger – yes I understand the manufacturing capacity with the new plant coming on line soon.

        It was the additional 30,000 with a cost base of $20m that really excited me. And how they may do so with minimal plant expansion.

        I’m of the view that they could probably double the 30,000 as you suggested, without further plant by increasing the throughput and work days. But that is pure speculation on my behalf as I do not know what restrictions the regulators would put on the plant, if any.

        Thus I seek improvements in my analysis of this most interesting stock. If the current 7000 doses per unit is indeed a hard restriction and with anticipated growth then we should expect additional plant be be announced within the next 18/24 months – IMO.

      • They would need to acquire and install additional Hot Cells which each have the capacity of 6000 doses, cost $2-3m each and with 2 shift/3 days per week at $15,000 per dose should reach our ‘blue sky’ numbers. Keep in mind however the impact of the results of the Sirflox trial is binary.

    • Russell Muldoon
      :

      Thanks for this Colin. Note that this relates to chemo-refractory patients with mCRC, the salvage setting whereby SIRT has proven itself over the past decade. This should not be confused with SRX’ SIRFLOX and FIREFOX studies to prove efficacy in the first line setting with chemo as they are two completely different modalities.

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