Another drubbing for the EMH

for those that still believe that markets give the best indication of value comes this study from the Central Bank of Brazil, all about bonds

There is a widespread belief that inflation-linked bonds are a direct source of information about inflation expectations. In this paper we address this issue by analyzing the relationship between breakeven inflation (the diff erence between nominal and real yields) and future inflation. The dataset is extracted from Brazilian Treasury bonds covering the period from April 2005 to July 2010. We find that break-even inflation is an unbiased forecast only of the 3-month and 6-month ahead inflation. For medium horizons (12 and 18 months) break-even inflation has weak explanatory power of future inflation. Over long horizons (24 and 30 months), we report a significant, but counterintuitive, negative relationship between the break-even and realized inflations.

Seems that the market just cant get anything right

New IGRA meta-analysis

..the current systematic review and meta-analysis on the accuracy of the IGRAs for LTBI diagnosis confirm the concept that the IGRAs are a valid alternative to the TST. The superior specificity and the good NPV make them the first choice, especially in BCG-vaccinated subjects..

..the predictive value for progression to active disease when testing positive is higher for the IGRAs as compared to the TST.

This one is from Diel et al and is published in the European Respiratory Journal, which is the official journal of the European Respiratory Society.

Abstract can be viewed here and I have reproduced a copy of the discussion, below the fold.

Reds under the bed

When they start yelling "Commie!" you know they must be hurting, this time it is the Liberal's Joe Hockey who is on the receiving end

It would appear he's been taking economics lessons from Hugo Chavez and I don't really see there's much future in Australia for this type of policy; it's crazy

That was from the ANZ's Mike Smith.

This must be a worry to the Liberals, who struggle to maintain an identity that differs from socialism.

Everything old is new again

For many the BCG vaccination is ineffective and old hat, in the US it was discontinued because

its effectiveness in preventing infectious forms of TB has been uncertain

and in the UK becuase it was felt that

BCG vaccination does not have a significant impact on the incidence of disease in a population

However there is now evidence to the contrary;

In July 2008 a case of smear-positive pulmonary tuberculosis (TB) in a white UK-born nursery teacher was notified in London. The case had been symptomatic for 9 months while working in the nursery...

...This outbreak shows extensive transmission of TB among very young children. BCG seems to have a protective effect against TB infection as assessed by positive IGRA in this cohort.

TB continues to confound the experts

Japan, one country that can turn paper shuffling into an art form

From JATA, a study of XDR-TB in just one hospital

All 13 cases had been diagnosed at other hospitals. The mean period from TB diagnosis to XDRTB diagnosis was 56.8 months, and the mean period from TB diagnosis to referral to our hospital was 81.6 months

All this is in a country that has called TB a national emergency - the times indicate poor treatment and/or poor follow up of diagnosed cases

XDR-TB and MDR-TB are man-made diseases. We need to take measures not to create more XDR strains and induce more MDR-TB cases.

Mori and Kobayashi can see problems

poor incentives for TB treatment discourage the healthcare community from continuing TB clinical services, thus presenting an urgent challenge for ensuring the quality and quantity of TB treatment...

...the TB problem as a whole has become increasingly formidable, both medically and socio-economically, and the government and the healthcare community are not addressing this new situation appropriately

Crunching those Medicare numbers

The latest Medicare data is out with QFT and TST still apparently playing cat and mouse;

However a closer analysis (of the month of September) reveals a disparity in State by State usage;

In nearly all States QFT is king; it would appear that Victoria is home to the TB Taliban.

The main point is that QFT can do it!

TB diagnosis, still not getting it right

At the annual AIDS conference Jean-Francois Lemaire  and Martina Casenghi argue that current TB diagnosis is too complex for the average patient (this applies to the developing world)

TB patients are still to date left with either fair access to poor diagnostics or poor access to fair diagnostics.

NZ TB Guidelines

More on updated Kiwi guidelines

A number of District Health Boards are shifting away from using the Mantoux due the logistics of delivering the test and are now using the QuantiFERON Gold assay for preemployment screening

QuantiFERON and prisons

Oregon Department of Human Services have ruled that correctional institutions are to risk assess for TB and if necessary test for TB, either TST or QFT, via Oregon Administrative Rules (OARS) 333-019-0041.

 The ruling applies to inmates and employees of "non-minimal" and "minimal" is defined as

• No cases of infectious TB occurred within the facility during past year
• Facility does not house substantial numbers of inmates with risk factors for TB (HIV, homeless, IVDU)
• Facility does not house substantial numbers of new immigrants

I wouldn't think that there would be too many "minimal" facilities out there.

Adverse publicity is exactly that, adverse and legal action is not a good use of taxpayer's money

 

They are taking TB seriously

QFT and Hep C

CDC back in the legal spotlight

It would appear that Andrew Speaker now has the sympathy of the courts

When individuals at a massive government agency, backed by nearly limitless political and financial resources, choose to come after you and your family in hopes of sensationalizing a story for their own personal gain, defending yourself is a nearly insurmountable task," he said. "They intentionally and willfully covered up what happened, what the test results really were."

It is debatable whether such legal actions would make the bodies such as the CDC better able to fulfill their charter. Speaker is not denying his actions however he is seeking

unspecified monetary damages and attorneys' fees.

Given the difficult nature of TB diagnosis this case could frustrate efforts to curb the spread of MDT-TB and XDR-TB.

TB in Birmingham UK - now "running out of control"

That is according to the official rule book

The Heart of Birmingham Primary Care Trust, which includes Ladywood, Aston, Nechells and Sparkbrook, has reported 99 cases per 100,000 of population – more than double the 40 cases per 100,000 point at which Department of Health advice suggests the disease is running out of control.

The relevant authorities appear to be floundering

Coun Deirdre Alden, who chairs Birmingham City Council’s health scrutiny committee, accused the PCTs of being in denial about the scale of the problem, with treatment costs in Birmingham hitting £1.5 million a year.

In the land of the blind..

An enthusiastic commentator on Cellestis recently said

QFT is such an exciting and sexy story. Shareholders at that AGM would love to hear all this nitty-gritty stuff. And the general market would love to read about it in the accompanying market releases, and press releases and to even to watch the presentations on video hook-up!!!

Shareholders would?

The market would?

I am always wary of those who claim to represent my opinion and my best interests.

Active management of shareholder equity

KBA Consulting Group hold various points of view, including this one

If the observed market value is less than the intrinsic value, the capital markets might not understand the company’s strategy. Alternatively, investors might lack confidence in the ability of the management team to execute the strategy successfully. Dealing effectively with these communication and management capability issues should result in the creation of wealth for existing shareholders.

KBA founder Denis Kilroy was able to put his theory into action when he became a director of Solagran. Numerous PR events, media briefings and investor roadshows saw the company's shareprice increase however it then fell to below what was considered to be the companies intrinsic value

It all went horribly wrong, in an effort to maintain market demand and shareholder equity the directors engaged in share buying by raising funds through a private equity, in this case the infamous OPES.  Once OPES went belly up the collateral was called in and Kilroy & Co were left with virtually nothing.

Betting on the market has always been a mug's game, one only has to look back to see other parallels, as John Keynes once famously stated

Markets can remain irrational a lot longer than you and I can remain solvent.

Clearly company management has no role to play in market valuations and accordingly managers should not be guided by shareholders opinions. Warren Buffett is quite clear on this, he never interferes with management

"If they need my help to manage the enterprise, we're probably both in trouble." 

The GFC has seen the collapse of many models and the model promoted by KBA was one of them.

Counter intuitive

That's how I see the argument by some Cellestis shareholders - they say that management have neglected marketing to both the medical community and the investment community and that this "failure" is reflected in both sales and share price.

Cellestis management will readily concede that they have had done little if any marketing in Australia so how does this happen, where sales are ~50% of the total market?

Perhaps global success lies in less not more marketing...

Japan drops the ball

Judging by this study the Japanese need a rocket under them;

PURPOSE: To observe the current situation of tuberculosis and its control measures in hemodialysis facilities in Chiba Prefecture, Japan.

METHOD: Questionnaires on medical dialysis and tuberculosis were sent to hemodialysis facilities in Chiba Prefecture.

RESULTS: The questionnaires were answered by 55 of 127 facilities. Of the respondents, 46 (83.6%) were not aware of the recommendation of treatment for latent tuberculosis infections in Japanese patients. Moreover, 30 (54.5%) facilities did not examine patients for tuberculosis prior to the initiation of hemodialysis. Of the 21 facilities that did assess patients for tuberculosis infection, only 5 (23.8%) performed a tuberculin skin test or QuantiFERON TB-2G. Three of the five (60.0%) that were treating tuberculosis by themselves expressed fear or uncertainty about the diagnosis and treatment of latent tuberculosis infections. During January 2006 through December 2007, tuberculosis patients were detected in 11 facilities, and the proportion of extrapulmonary tuberculosis among these patients was 52.4%. Seven facilities reported that they took no control measures against tuberculosis.

Skin test results are "abysmal"

..so says Dr David Holland of Duke University Hospital

The skin test, however, is very operator-dependent. It relies on proper placement and reading technique. "In the average clinical setting the reliability of this test is abysmal," he said. Even in the best setting, using trained observers and the correct technique, the intra- and inter-observer reliability is only fair.

The IGRAs, by comparison, stand to improve the detection of LTBI.

You can bet on it

Various commentators on SS appear to be advocating the buy low sell high philosophy, they may be more suited to this venue;

All paid for by the generosity of punters who failed to pick the winning horse.

Let the facts speak for themselves

The question was asked "Has the company considered going down the path of discrediting the TST test?"

To openly discredit your "opposition" would detract from your own product and story, it is far better to let the observer consider the facts and be allowed to form their own opinion. Take for instance this guide by the CDC where the emphasis is on Self-Study. Then look further down to Targeted Testing and the Diagnosis of Latent Tuberculosis Infection and Tuberculosis Disease and compare this

Mantoux Tuberculin Skin Test (10) BCG Vaccine
People who have been vaccinated with BCG may have a false-positive TST reaction

However, there is no reliable way to distinguish between reaction caused by TB infection or by BCG vaccine

with this

IGRA Advantages
Less likely to have incorrect reading of results as compared to TST

BCG vaccination does not affect results

There is slide after slide describing how to apply the the skin test, how to interpret it and the various possibilities that can be deduced from the reaction. Then consider the information on QFT

QFT-G and QFT-GIT (2) Conducting the Test

Follow manufacturer’s instructions 

There are also the pictures, which tell the same story in a different format;

Thanks for the use of your arm as a testing site, hope I get it right this time

 Was that a "hmmm.. 5mm or 6mm?"

For QFT it is a simple matter of pressing the button and walking away


Finally the CDC asks and then answers the important question (slide 59)

What are 5 advantages for using an IGRA as compared to the TST?

Requires a single patient visit

Results can be available in 24 hours

Does not cause the booster phenomenon

Less likely to have incorrect reading of results

BCG vaccine does not affect IGRA results

All that is required is for the facts to be properly considered.

Marketing just doesn't get any better than this

Seen in the Philly


By Mitchell Hecht
For The Inquirer
Question: Before starting school, I had to have a "PPD skin test" to check to see if I was ever exposed to tuberculosis. Why couldn't I just have a blood test to check for this, similar to HIV or herpes tests? Or what about just getting a chest X-ray?

Answer: Actually, there is a blood test available through Quest Diagnostics, LabCorp and other labs: the QuantiFERON-TB Gold In-Tube (QFT-GIT) test. While I've not personally used the test, it does have several advantages over traditional PPD tuberculin skin testing.

First, the traditional PPD skin test requires a second visit to the doctor's office after 48 to 72 hours to check the site where the test was administered for any reactivity. Second, PPD skin tests can sometimes be interpreted falsely as being positive - especially with those who have received the BCG vaccine (inconsistently effective as a worldwide vaccine, it uses a cousin of the tuberculosis bacteria to induce immunity) because they come from countries such as India where tuberculosis is endemic. Third, falsely negative PPD tests can occur in folks who are seriously ill or immune-suppressed.

The QFT-GIT requires a single blood draw, and can distinguish between prior BCG vaccine exposure (Mycobacterium bovis) and latent tuberculosis infection from Mycobacterium tuberculosis. False negative test results are unlikely to occur as well. The main drawback to performing blood testing for latent tuberculosis is that the specimen must be received and tested by the lab within 14 hours, which is not always possible.

A chest X-ray can identify active tuberculosis in the lungs but cannot identify quiescent, previously untreated tuberculosis. So a normal chest X-ray does not exclude TB disease.

Cellestis -Eureka Report

The Eureka Report, which is claimed to be

a continuous, multimedia, online publication for investors in self-managed super funds, property, retail managed funds, direct shares and fixed interest securities. Its mission is to inform, advise, guide and educate independent investors in a timely, reliable and cost-effective way.

has an item on Cellestis (you can sign on as a new user for a free trial)

Looking at the chart for the company (share price of CST for the previous two years), it's hard to believe that Cellestis, a developer and marketer of immune disease diagnostic products, is producing such good results and is in such good financial shape. This is a company with zero debt and which had $6.79 million in net operating cash flow in the 2010 financial year on tangible assets of $35million; in other words, a very strong return

Thin edge of the wedge

Consevative medical opinion swings towards IGRA

Comment: In wealthy countries like Australia, we should be using both tests to detect LTBI.  If the tuberculin test (PPD 10units) is less than 15 mm induration,  then a QuantiFERON –TB gold in tube is called for .  This should considerably reduce the number of people treated unnecessarily.

US vulnerable to MDR-TB epidemic

Link

While the U.S. has made great progress in the prevention and treatment of tuberculosis, the nation has become more susceptible to potential epidemics of multidrug-resistant tuberculosis (MDR-TB), according a study led by Johns Hopkins researchers. Computer simulations show that as TB prevalence falls, the risk for more extensive MDR-TB increases. In addition, the simulation also showed that higher detection of TB cases without proper treatment of cases also increased risk. The study findings are published in the September 22 edition of the journal PLoS ONE. An interactive TB computer simulation used by the research team is available at mdr.tbtools.org.

MDR-TB is a form of tuberculosis that is resistant to at least two of the primary antibiotics used to treat the disease. The World Health Organization estimates that MDR-TB affects between 0.5 and 2 million people each year worldwide, but there were only 111 cases reported in the U.S. in 2006.

For the analysis, the researchers developed a computer model to simulate the potential for MDR-TB epidemics. Eighty-one scenarios covering a 500-year period were created with varying levels of treatment quality, diagnosis accuracy, microbial fitness and the degree of immunogenicity of drug-susceptible TB.

According to the study, when 75 percent of active TB cases are detected, improving therapeutic compliance from 50 percent to 75 percent can reduce the probability of an epidemic from 45 percent to 15 percent. Paradoxically, improving the case-detection rate from 50 percent to 75 percent when compliance with directly observed treatment is constant at 75 percent increases the probability of MDR-TB epidemics from 3 percent to 45 percent.

"The ability of MDR-TB to spread depends on the prevalence of drug-susceptible TB," said David Bishai, MD, PhD, MPH, senior author of the study and associate professor in the departments of Population, Family and Reproductive Health and International Health at the Johns Hopkins Bloomberg School of Public Health. "The most successful approach to reduce this risk for MDR-TB epidemics in the U.S. would be to ensure that populations around the world combine high rates of case findings that are tightly coupled to high compliance with directly observed drug therapy."

###
The authors of "Heightened Vulnerability to MDR-TB Epidemics after Controlling Drug-Susceptible TB" include Jason D. Bishai, an undergraduate student at Stanford University and William R. Bishai, MD, PHD, professor with the Johns Hopkins School of Medicine and co-director of the Johns Hopkins Center for Tuberculosis Research.

The research was funded in part by an award to Jason Bishai from the Robert Wood Johnson Foundation Young Epidemiology Scholars Contest and by NIH grant 5R01AI079590-03.

Biotechs, market size and M & A

A longish piece by Spanish Lawyers GarriGues on the importance of being big,

=====================

In spite of the M&A downturn both globally and in the healthcare industry in particular, 2008 saw a twofold increase in the volume of deals involving biotech firms. Judging from the news that emerged during 2009 and in light of recent surveys, this trend looks set to continue and the outlook is undoubtedly rosy, above all in pharmaceutical R&D.

This is of course by no means the first time that a boom in the biotech industry has been forecast. It has escaped no one's notice that the biotechnology business is a particularly regulated industry and one that poses risks at various levels. It remains to be seen, first of all, whether the above trend will also be embraced by SMEs. We will also need to wait and see whether such an outlook holds true for the Spanish market, the development of which is noteworthy, albeit, as is common knowledge, not free from certain idiosyncrasies.

In any event, the relatively cycle-proof nature of the healthcare sector and the growing need of major pharmaceutical companies to diversify their pipeline ought to be grounds for optimism, so the experts say. Many of them predicted that the pharmaceutical corporations, enjoying an enviable financial position, would be unable to resist the lure of the more than reasonable valuations offered by many biotech firms, and data gathered internationally would appear to bear out such predictions.

Against this backdrop, as far as Spain is concerned, reference must unavoidably be made to the new Law on Structural Modifications to Commercial Companies (the LME). Standardizing and revising the rules on structural modifications at commercial companies, this piece of legislation is all set to have a significant impact on the country's M&A market.

The Law on Structural Modifications to Commercial Companies

The LME sets out the regulations governing structural modifications at commercial companies, consisting of alterations of legal form, mergers, spin-offs, transfers en bloc of assets and liabilities and including international relocations of registered offices.

This short article does not seek to provide an all-encompassing review of this Law, but rather simply to take a brief look at some of the new developments that will foreseeably have a greater impact on deals struck in the biotech industry.

Changes to the merger regime

Mergers and acquisitions are without doubt the method most frequently used by companies seeking to grow in size and boost their productivity. In the case of the biotech industry, such deals are essential in order to reach the size required to attract the attention of investors and make their way in a globalized market. This is why they have played such a pivotal role in the development of the sector in the US.

In this article, we will focus on the general merger regime. Nevertheless, it is worth pointing out that the LME transposes the Directive on Cross-Border Mergers into Spanish law, bringing with it an express set of rules on mergers between companies from different EEA States. Although such transactions already took place in practice, the new procedure will help overcome the numerous hurdles facing intra-EU mergers, and is also expected to facilitate mergers with non-EU companies.

Generally speaking, the new regulations introduce an array of provisions in a bid to simplify and expedite mergers. First of all, the cases in which a report by an independent expert on the merger plan is not required have been widened (with the resulting savings in costs and time that this will bring about).

The LME also attempts to simplify intra-group mergers, extending the scope of the simplified procedure, already provided for under the Spanish Corporations Law, to cover cases in which the absorbing company directly holds a stake of at least ninety percent in the absorbed company.

In the same vein, the simplified procedure may also now be used to expedite deals in which corporations or partnerships limited by shares play no part and where a resolution has been unanimously adopted by a shareholders' meeting held without prior call and with the attendance and unanimous consent of all the shareholders.

In the interest of certainty in legal transactions, the LME excludes the possibility of challenging a merger once it has been registered, unless it is carried out in breach of its provisions, and establishes, in any event, a three-month time period in which to allege the nullity of the merger. Nonetheless, with a view to safeguarding minority shareholders' rights, an out-of-court procedure for challenging the exchange ratio has been put in place.

The LME introduces a special set of rules governing deals that have been particularly prevalent in recent years, above all in the private equity industry: LBOs followed by a merger between the buyer and the target. While this type of transaction is less commonplace in the biotech industry, it is worth noting that the LME lays down special requirements for mergers between two or more companies where one of them has incurred debt in the three years immediately before acquiring control (or essential assets) from another company in the merger.

Changes to spin-off rules

As we see it, the concept of spin-offs looks all set to play a particularly key role at biotech firms, not simply as a mechanism with which to split up the various lines of business and thus isolate the risks associated with each, but also as a means to enable financing rounds and the entry of investors solely into those business areas of interest to them.

According to the LME, a spin-off may take the form of a total spin-off, a partial spin-off, or a segregation. As far as the first two methods are concerned, suffice it to say that the legislation does not introduce too many new developments with respect to the regime previously in force.

It is, however, worth noting the express regulation under the LME of segregations and "hive downs," placing them on a par with spin-offs. "Segregation" is understood to mean the transfer en bloc by universal succession of one or more parts of a company's assets and liabilities, each constituting an economic unit, to one or more companies, where the segregated company (but not its shareholders) receives shares in the beneficiary companies.

"Hive downs" have been defined by some as what the new Law classifies as the "formation of a wholly-owned investee by means of the transfer of its assets and liabilities." In other words, a transaction whereby a company transfers en bloc its assets and liabilities to a newly-formed company, receiving all of the shares in the beneficiary company in return.

Thus, Spanish law now allows for the possibility of performing these two transactions under the aegis of the principle of universal succession, an essential prerequisite for the viability of many transactions of this type.

Conclusions

It would be remiss to deny that certain aspects of the LME are difficult to interpret. Given the limitations of this piece, we have made no reference to such aspects. Despite this, the new legislation should not be viewed overall in a wholly negative light. It represents a further step (albeit transitional, as acknowledged in the LME itself) towards perfecting Spanish corporate law. In general terms, it offers a more comprehensive and, in many cases, simpler framework under which to reorganize Spanish biotech firms.

Big Oil -vs- The Terminator

Writing in the NYT Thomas Friedman outlines the battle between the government and business over new regulations to reduce carbon emissions. Various companies take the view that the states' rights should not interfere with their rights to do business

The real joke is thinking that if California suspends its climate laws that Mother Nature will also take a timeout. “We can wait to solve this problem as long as we want,” says Nate Lewis, an energy chemist at the California Institute of Technology: “But Nature is balancing its books every day. It was a record 113 degrees in Los Angeles the other day. There are laws of politics and laws of physics. Only the latter can’t be repealed.”

Quit yer belly ackin'

Property speculators in WA are crying poor

It’s been all bad news for property investors in Australia for the last 5 years. All of the benefits of “Negative Gearing" have evaporated between government intervention through lower taxes, Banks lowering LVR’s and raising lending criteria and a flattening out in house price rises. No wonder buyers are now saying “why bother”

One moment there is too much govt intervention next it is too little....maybe these characters will just have to join the rest of the real world and earn a living.

Spoilt for choice..

..in WA

Establishment of Quantiferon Gold ® TB Test tubes through the WDP Supply Department
With the more widespread use of the test for both Medical and Commercial related testing the method of supply has been changed to the same as for all other pathology consumables. The supply order number has been added to the order sheets for the WDP designated Quantiferon Gold ® TB Test locations.

Another one bites the dust

Accolytes of the Efficient Market Hypothesis might well feel better served by scanning the Situations Vacant sector of the dailies, no doubt the pain was more keenly felt in the Murdoch rag when the resident financial gurus proclaimed

Reserve Bank lifts interest rates to 4.75pc

Christopher Joye thinks that the media have had their wings clipped intentionally,

"As an aside, note that the surprise decision today potentially signals a change in communication strategy by the Reserve Bank. In the past, the Bank has been fond of guiding the market via indirect signalling via the media. That hasn’t been the case this month, but it is not clear whether the Bank has permanently closed this channel."

Now you know

This Steve

I am a medic from Southeast Asia, now living in Britain. I intend to use this site as my continuing medical study tool.

I am doing my speciality training in Wessex deanery.

And he says

Posted 4 October, 2010 - 14:44 by steve
QuantiFERON®-TB Gold test is for screening tuberculosis contacts and predicting active disease. I rarely see tuberculous patients in last few years. So this test is new to me, I must admit.

This time the reason I organized for this test is not for TB patient, but for someone who has an extensive psoriasis. He needs  USTEKINUMAB, which is a cytokine modulator as per dermatologist's advice. We do TB screening before starting it.

Tuberculosis and climate change

I often like to draw comparisons between those that cling to using outdated and inefficient medical procedures, such as the TB skin test (aka the TB Taliban) with those that refuse to accept the evidence of climate change. These people like call themselves "skeptics" and refer to the role of skepticism in scientific investigation to legitimise their position. The reality is that these people often refuse to contemplate the scientific evidence, they are in essence "deniers" and are living in a state of denial.

Consider the evidence from this site http://rimfrost.no/ and choose any location, let's say Beijing www.sportsys.nu/klima/BEIJING_TREND.gif

Or the considered evidence based opinion of the ECMWF www.ecmwf.int/publications/cms/get/ecmwfnews/263

Consistent with widespread media reports of extreme heat and adverse impacts in various places, the latest results from ERA-Interim indicate that the average temperature over land areas of the extratropical northern hemisphere reached a new high in July 2010. May and June 2010 were also unusually warm.

Deniers have political significance and should not be ignored but you do have to wonder how much longer their position can be sustained.