that their patients get different types of infections in their operating rooms, Poulos notes. Major infectious disease societies have been nagging hospitals for years to do more to curb the spread of this bug and others, by using bleaches to clean every imaginable square inch of hard-to-reach surface areas in their buildings. “C.diff” hasn’t been in the headlines lately, either.
“It’s very difficult. People get on the bandwagon for a while, and get tired of it,” Poulos says. “We believe it’s going to be a fad. It will come and go.”
Another driving force for change in the “C.diff” market is beyond Optimer’s control—diagnosis. The “C.diff” infection is usually diagnosed through what’s known as an Elisa test, which can take 48 hours to produce a lab result, Chang says. In the meantime, patients are suffering from severe diarrhea and dehydration, and when the doctor is in doubt, the choice is often to go with vancomycin—an antibiotic that’s effective against a broad array of different types of bacteria.
To change that paradigm, and convince doctors they need to choose the Optimer drug right away, the company is rooting for Sunnyvale, CA-based Cepheid to have some early success with its molecular diagnostic instrument. This tool is supposed to help doctors diagnose “C.diff” infections in an hour or two, Chang says, which could clearly direct them to the first choice therapy for this bug.
Beyond that, I have to wonder if hospitals might balk at the price. Optimer isn’t saying what the price will be, but Poulos told me “it will be expensive.” He explained to analysts on a conference call on Thursday that the price will be based on health economic analyses that shows how the Optimer drug can save the system money by reducing hospital stays, and the expense that comes when people have to be re-hospitalized with recurrences.
And of course, building up the sales force is going to take money—and that’s something Optimer needs. The company reported about $48 million in cash and investments as of September 30, its last quarterly report. Optimer is burning through about $10 million a quarter now, Chang says. That means it will need to raise more money this year, either through a partnership or by raising capital from investors, Chang says.
So while the clinical trial results are unequivocally good news, that’s not the only risk investors have to consider. If Optimer has to raise money by selling more shares, that will dilute the value of existing shares. As Yang, a bull on the company with a $20 price target, noted dryly in her report, “additional financing risks” remain.
