Episode 912: Starting to Doubt My Short... Sellas SLS Short Thesis Update, My Best Short Calls

**Martin** (0:00)
The basic thesis is there's no evidence that this drug works. There is a very similar drug that here that failed.
AML is driven by tons of different tumors, so a single antigen vaccine is not going to work. That doesn't make sense. The resting assumption on all drugs is that they don't work, unless you have dramatic evidence that they do.
So yeah, it's pretty simple. I can start writing the thesis if you want. O9 is worth nothing. You guys are just new to biotech. But I appreciate the goading, because otherwise I'd be too goading, G-O-A-D. I'd be too lazy to do the homework and short it. So you actually are helping me a lot, because I get convinced after I write the paper. If the paper is convincing, then I can go very aggressively on shorting. It's very hard to borrow.

**SPEAKER_2** (0:49)
Okay, why SLS? Why Sellas?

**Martin** (0:53)
Sellas' gallin pepimic. This will not work in the regal clinical trial. Yeah, I mean, you guys are just gonna avoid biotech from here on out. This happens all the time, guys. This is...
Do you think all the people... You know, all the stocks are shorted over the years? Like, I mean, I just think... What's surprising to me is, you know...

**SPEAKER_2** (1:12)
Yeah, I don't know.

**Martin** (1:14)
It shouldn't be surprising. This happens every time.

**SPEAKER_2** (1:16)
Yeah.

**Martin** (1:17)
The same... People said the same thing about Kasava, ATYR, you know.
I've lost one of these, which is Capricor. And I think Capricor lied and is a scam, but at the very least, you know, I've had a pretty good win rate, so... No, Capricor is a really crazy one-off that happened. I mean, that was insane. Yeah, we'll see in the briefs, but, you know, I was very pissed off at Capricor, man.

**SPEAKER_2** (1:41)
Wow. Okay.

**Martin** (1:42)
I have never been wrong when I write up myself.

**SPEAKER_2** (1:46)
I'll say that.

**Martin** (1:46)
Yeah, I know the MSK guys pretty well. I don't think the MSK guys will tell you this is going to work. I've been consulting with those guys for decades, you know.
Listen, this is just one of many investments for me that's, like, very emotional for you guys. I just suggest you reduce your position so you don't get run over. Just be prudent, or the market will be prudent for you. Yeah, just because you're on a SAB does not mean you think it's going to work. Yeah, I mean, I'm very, very wrong, Capricor. Very rarely wrong. I mean, Capricor is a one-off.
I don't think I've been that wrong in 10, 15 years. There's no risk to be on SAB. You just get paid. It was very easy money. Now remember, cancer vaccines have never worked. The sole cancer vaccine, the sole FDA-approved cancer vaccine, Roevenge is widely thought to be not efficacious. Go to ACM. There's no reputational risk. Every one of these clinical trials fails. I mean, if there was a reputational risk to being in a failed clinical trial, I mean, everybody's hurt their reputation then. There's not that many AML trials that go on anyway. So okay, cancer vaccines have never worked. The sole FDA-approved cancer vaccine, Provenge is widely thought to not be efficacious. The reason cancer vaccines do not work is cancer is seldom driven by a single mutation.
Vaccinating against that mutation is difficult as epitope-specific.
Immune response is difficult to engineer. And, you know, there's no date announced yet, which has been frustrating because the trial has taken a year, two years longer than we thought it would, which definitely doesn't mean it's working. I don't know, Kareem. I don't think so. Yeah, no, I run things by Wi-Fi.

**SPEAKER_2** (3:32)
She's...

**Martin** (3:32)
Yeah, when I saw this OCV data, OCV 501, I was sure it didn't work. Um, OCV 501, a clinical trial of OCV 501 revealed that the W21 thesis for AML is doomed. Gallin-Pepemet-S itself had a uncontrolled Phase II with an astounding 68-month OS overall survival in so-called CR1 AML. This trial is in CR2 AML, which varies wildly in its overall survival.
Sellas foolishly predicted a, or I guess assumed, an 8-month overall survival for control versus a 12.6-month survival for drug. Unfortunately, estimates on CR2 overall survival vary dramatically. One paper reveals a 16.5-month median survival. Let's, we could do a trial model, too.
Not exactly splashy, but that is a good question. You want to live as long as possible. That just goes without saying, right?

**SPEAKER_2** (4:53)
Okay, so let's see.

**Martin** (4:54)
When did this stupid trial start? They modified this.

**SPEAKER_2** (4:57)
Okay. Let's see.

**Martin** (5:00)
1-8-2020 enrollment began.