Is it Time to buy Allergan (AGN) Stock?

Note: I am no expert in stock market trading and I currently hold no Allergan (AGN) shares in my portfolio.  If I were a bit wealthier, I would seriously consider buying a few hundred shares of the pricey AGN stock.

FYI — The most important part of this lengthy post is probably right towards the end in red.

I have discussed Allergan (of Botox fame) several times on this blog during the past year. The company has had an extremely eventful 2015.  In March of this year, it was acquired by Ireland’s Actavis, but the acquiring company then changed its name to Allergan, probably because the latter is so much more widely known than the former. More importantly for us hair loss sufferers, in June of this year Allergan acquired Kythera Biopharmaceuticals.  As a result, Allergan now holds the rights to three potentially blockbuster products (first two are related to hair loss):

  1. Bimatoprost (prostamide — aka prostaglandin-ethanolamide  — analog).  This is not exactly a PGE2 analog as is often mistakenly cited on internet forums.  Sales will depend on the clinical trial results that I hope will be published any day in the next several months.  If effective, I would guess that sales will be drastically higher than lower-dose Bimatoprost products currently sold by Allergan = i.e., Latisse (around $150 million annual sales) and Lumigan (around $600 million annual sales). Maybe $1 billion in 2017 sales if the product really has a better effect than Minoxidil and it is released in 2016?  I am just throwing around numbers here so a financial expert can perhaps post comments with better forecasting.
  2. Setipiprant (KYTH-105 — selective oral antagonist to the PGD2 receptor).  Still several years before clinical trials for hair loss are completed, but numerous other clinical trials for other conditions have been completed on humans with no major side effects. Maybe this pre-existing safety profile will speed up Allergan’s trials, especially in combination with newer regulations from the 21st Century Cures Act.  Kythera also submitted an Investigational New Drug Application (IND) for Setipiprant to the US FDA a few weeks ago.  If extremely effective, sales would easily hit a few billion dollar per year in say 2020, but this is too much speculation so early in the process.  Note: Numerous people on hair loss forums are already testing Setipiprant, but I have not closely followed how they are getting their product and whether its topical or oral.  If there are many positive anecdotal reports on this in the next year, I will have to seriously consider borrowing money to buy at least several hundred shares of AGN stock.
  3. KybellaTM (ATX -101 — a patented formulation of deoxycholic acid) injected into the face to eliminate double chins.  This product was approved by the FDA in April 2015 and is already in use at 100s of clinics in the US.  Unlike the case with Botox, results from Kybella supposedly last for years.  Waiting lists are already being created in countries that have not yet been granted licenses to use Kybella.  It is worth following realself Kybella reviews to see if the product is all that it is touted to be (keeping in mind fake or flaky reviews). One article I read suggests that Allergan expects annual sales of $500 million for this product in a few years, and the patents on it run out around 2025-2030. However, there are some sources that suggest that that this product could be used for other purposes (love handles?) illegally/with doctor approval too.  Is it possible that Allergan can make much more in Kybella sales than they expect?  Moreover, it seems like it is fairly simple and cheap to manufacture this Kybella product.

Note: Allergan’s total company sales in the first half of 2015 were $10 billion.

Like many hair loss forum members, I have been much more optimistic about Setipiprant than about Bimatoprost.  Clinical trial results of Bimatoprost used at a higher dose on scalp hair have been delayed for many months, although that does not necessarily mean that the results were too weak.  I should note that I have read some positive testimonials about Bimatoprost on hair loss forums, and it is almost impossible that an Allergan representative is posting such testimonials.  Hopefully Bimatoprost turns out to be at the very least as effective as Minoxidil, while Setipiprant turns out to be even more effective and capable of growing new hair (or turning vellus hair back into terminal hair).

Is Allergan Preparing to Release Bimatoprost for Hair Loss?

In any event, the main reason for writing this post was because several days ago a member on the Baldtruthtalk forums posted an interesting link regarding Allergan expanding its plant in Waco, Texas.  The expansion is due to the addition of new processing equipment for packaging.  While the company’s VP of operations declined to name the products for which the packaging would be needed, there is a good chance that it might be for Bimatoprost. The plant already makes weaker versions of Bimatoprost (Latisse and Lumigan).  Moreover, the VP of operations said something very interesting:

We will be producing new packaging for new and existing products, and we could see the need to hire more people by the third quarter of 2016 if demand for these products increases.

Blog readers who live in Texas, please go to Waco and do some ground research!  Buy one of the workers at this plant lunch and beer to get some inside information.  Look around for any paper trails or early arrival of packaging material labeled with anything with the words “Bimatoprost” or “hair” in it.  It might seem like I am joking but I would definitely do this if I were living in Texas.  Why not spend a day in Waco?

Maksim Plikus and Zhengquan Yu

Update: September 2020 — New Interview with Dr. Maksim Plikus:

Yesterday, Reddit PLOS Science Wednesday AMA (Ask Me Anything) had a highly unusual session with two hair loss experts: Dr. Zhengquan Yu and Dr. Maksim Plikus. Official citation link is now here. While the title of the session only mentioned Mr. Yu, the two experts spent an equal amount of time answering questions.

MicroRNA (miR-22) and Hair Loss

Earlier this year, Mr. Yu co-authored an important paper on the influence of microRNA (miR-22) in hair loss in mice that was published in PLOS.

Update: July 27, 2020 — New study from North Carolina State University finds MicroRNA (miR-218-5p) shows promise for hair growth.

Surprisingly, Mr. Yu is an associate professor at the China Agricultural University, one of the last places where you would expect to see research on hair loss. I found it funny that somewhere in the AMA, Mr. Yu mentions the potential for creating hairy goats!!

Several days ago Chinese scientists also announced the creation of genetically modified tiny pigs to keep as pets. One day I should fly over to China to see where all the secretive hair loss research is taking place.

Dr. Maksim Plikus and Dr. Zhengquan Yu on Reddit

While Mr. Plikus was not a co-author of the above paper, his responses on the Reddit were quite thorough and interesting. I did not realize the huge amount of work that he has already done on hair loss related research. Mr. Plikus is an assistant professor at the University of California Irvine.

Getting back to the Reddit AMA, some of the more interesting Q&A’s:

Question from “Wkbrdnjoe”: “Now that you guys have found positive results in mice, what is the next step? Testing humans?”

Answer from Maksim Plikus: “Mouse findings would certainly have to be validated in humans. Currently, pilot testing on human hair follicles is possible using two experimental approaches: (i) organotypic hair follicle culture, and (ii) human-on-mouse xenografts. Anagen phase hair follicles, including human follicles, can continue to grow in vitro under specialized culture conditions for approximately one week.

Human hair follicles grafted on immune compromised mice can grow for many months, imitating their normal, long-lasting anagen phase.  Both approaches are widely used in human hair follicle research.  Importantly, human hair follicles significantly differ from mouse in terms of signaling regulation. For instance, while human hair follicles are highly sensitive to androgen signaling, mouse follicles are not. Therefore, mice can not recapitulate the pathogenesis of human androgenetic alopecia.”

Later on, Maksim Plikus responds to a lengthy question from famous hair loss forum member “Swooping” with the following:
“Your knowledge on androgenetic alopecia already appears to be pretty extensive. As you can appreciate, it has a complex mechanism, therefore many if not all factors that you mentioned are probably involved in its pathogenesis. What is important is to figure out which ones are upstream and which are downstream. This would affect the therapeutic potential of the targets.

As I already mentioned in another reply, rodents and mice specifically, are not an appropriate model for studying androgenetic alopecia. Mouse hair follicles grow very differently from human scalp follicles. Mouse dorsal hairs grow only for about 2 weeks and attain 0.7-1cm in length. This is equivalent to human scalp vellus hair. Moreover, mouse follicles do not respond to androgens the same way human follicles do, and mice do not develop androgenetic alopecia in response to testosterone treatment. This limited the research progress in androgenetic alopecia field. However, we now have organotypic culture system and human-on-mouse xenograft model that can be used for studies on human follicles.”

And the most optimistic response from Maksim Plikus: “Recent studies showed that dormant hair follicles in patients with androgenetic alopecia maintain their key stem cell population. Please refer to this study. This suggests that as long as the signaling mechanism of androgenetic alopecia pathogenesis can be interrupted, dormant scalp hair follicles can regrow. For instance, this 2003 study showed that grafting of vellus human scalp follicles onto mouse partially restores their normal growth characteristics: link.”

Some quotes from Zhengquan Yu regarding his work on miR-22:

“Based on this study, miR-22 antimir could be an effective drug for hair loss.”

“miR-22 antagomir or other anti-miR-22 oligonucletides could be used to inhibit miR-22 function, which would prevent hair loss or maintain prolonged follicle life.”

“I think that our findings provide a new therapeutic target to treat hair loss in way of microRNA. The cause of hair loss is pretty complex, it is hard to develop effective treatment for all patients. However, inhibition of miR-22 could benefit a certain number of patients whose hair loss caused by increasing miR-22.”

— Some more detailed technical responses are in the AMA that I will not paste here. Including many links to studies related to the complex genetics involved in MPB, plus discussions on quorum sensing, signaling and more.