relenza: mode of action, page-31

Dank, you are wrong about IV Relenza. The Relenza molecule is a large molecule (much larger than the Tamiflu molecule), and whether Relenza is inhaled or given in an IV form it retains its poor tissue penetrability. So even IV Relenza, should it ever be approved, will be unable to reach many organs, and certainly will not be able to cross the blood brain barrier (unlike Tamiflu). For this reason, its use as a treatment for H5N1 will be limited.

Speaking generally, govt scientific advisors are telling govt's to maintain relatively small stockpiles of Relenza (mainly because of poor tissue penetrability, but also because of ease-of-use issues re the inhaler). GSK, of course, know this, so they only planning to produce 15mill courses of Relenza this year, while Roche is producing 150mill courses of Tamiflu this year and 300mill courses of Tamiflu next year.

You should also keep in mind that not a single H5N1 patient has been treated with Relenza to date, and GSK seems in no hurry to conduct tests or place Relenza in a H5N1 hot spot. Despite positive animal studies, I think the fear is that it may not work as expected on humans because, by the time H5N1 symptoms are present, the virus has become systemic, rendering Tamiflu the preferred treatment option. Relenza's role in a potential pandemic is likely to be limited to protective use only, but even as a phrophylaxis, its role will be secondary to Tamiflu.

Given GSK's stated production targets for Relenza, no sane investor is buying Biota at current prices on the basis of Relenza upside. As an investment proposition, Biota is primarily a litigation play at present. By 2013, LANI may be producing significant profits, but given that Biota already has a $250mill+ market cap, and LANI is still pre-clinical, I think LANI upside is more than priced into the share price.