Pharmaceutical filing citing a Hepatology Communications paper — Lipocine, 2020-08-03
LipocineLipocineNASDAQ LPCN
Filings SEC · Quote Yahoo cited a paper published in Hepatology Communications in a regulatory filing with the U.S. Securities and Exchange CommissionU.S. Securities and Exchange Commission
Regulator · Website as a basis for its claims. The company read the way it wrote the paper and the actual scope of the paper in order. It noted where the stock price movement over the following month compared to past cases of the same type. This is a hindsight judgment written after knowing the results. The paper was read only up to the abstract.
The disclosure is written in the press release as follows
When a U.S. listed company has something to inform shareholders, it files a continuing report with the Securities and Exchange Commission, called 8-K. Lipocine filed this document on 2020-08-03, with item numbers 8.01 Other Events · 9.01 Financial Statements and Exhibits. The company cited a paper published in Hepatology Communications in the attached press release. If the sentence citing the paper is translated verbatim, it reads as follows:
EX-99.1 2 tm2026347d1_ex99-1.htm EXHIBIT 99.1 Exhibit 99.1 Lipocine Announces Publication of LPCN 1144 Liver Fat Study (“LFS”) Results SALT LAKE CITY, August 3, 2020 – Lipocine Inc. (NASDAQ: LPCN), a clinical-stage biopharmaceutical company focused on metabolic and endocrine disorders, today announced the peer reviewed publication of LPCN 144 Liver Fat Study (“LFS”) results, “LPCN 1144 Resolves Non-Alcoholic Fatty Liver Disease In Hypogonadal Males” in Hepatology Communications .
What a reader should first check is where the company placed the paper in the press release. Next, the reader should determine whether the paper supports the entire company claim or only a part of it. To answer the latter question, one must read the full paper. This article, which has only read the abstract, cannot provide an answer.
The scope of the paper discussed in the abstract is limited to this.
The paper's title is LPCN 1144 Resolves NAFLD in Hypogonadal Males and it was published in Hepatology Communications on 2020-08-02. The authors are affiliated with Virginia Commonwealth University · Lipocine (United States) · University of Chicago. The summary at the beginning of the paper is called abstract. This article has read only up to this point. The paragraph was written by a person after filtering a draft generated by a machine reading the abstract through numerical comparison, and thus it is of a different grade than a full-text review.
The data from 36 participants in an open single-arm trial of a testosterone prodrug administered to men with low testosterone levels, with multiple MRI measurements of liver fat. Two out of three participants had liver fat levels exceeding the baseline at the start, which could be classified as fatty liver. Most of them showed reduced liver fat, and nearly half no longer met the fatty liver criteria by week 16. No major side effects were reported. Since this is a small, non-controlled dataset, the paper cannot determine whether the improvement was due to the drug or natural recovery over time.
What the abstract does not answer remains in the full text and appendices. This article, which has not gone beyond the abstract, leaves the gaps as they are. Readers should compare the two citations above to determine which sentence in the abstract corresponds to the company's cited passage.
One month later, the stock price was within the middle half of the sample.
The remaining return after subtracting the portion that moves with the overall market is called excess return. The date is written as trading day, counting only the days the stock market is open. In terms of the calendar, 20 trading days are approximately one month. The excess return for the day of the regulatory filing and the following month are listed in the table below.
| Period | Excess return relative to the market | Meaning |
|---|---|---|
| Five trading days before the filing | +3.6% | The extent of movement before the filing |
| On the day of the filing | +9.5% | On the filing day or the first trading day thereafter |
| Accumulated over +1 to +5 trading days | +29.6% | One week |
| +1~+20 trading day cumulative | −10.3% | One month |
A bundle of past cases of the same type is called a sample. The position counted from the bottom is expressed as a percentile. The one-month excess return of -10.3% in this case is within the bottom 45% of the 142 samples, placing it in the lower half.
| Sample scale (20 trading days) | Tenth from the bottom | Fourth from the bottom | median | top 25% | top 10% | This case |
|---|---|---|---|---|---|---|
| Excess return | −31.9% | −20.1% | −6.9% | +5.5% | +19.5% | −10.3% |
Half of the sample falls between the two central marks in the chart. One checks from the chart whether this case lies inside or outside. The sample collects cases where U.S. listed companies wrote papers in 8-K over the past ten years. The company itself is excluded from the sample. The numbers written here are past facts, not rules to apply to the next case.
There are three more cases where the same company wrote papers in 8-K, and they are placed together in the table below.
| Disclosure date | the journal of the paper | a month of excess return |
|---|---|---|
| 2020-09-14 | Hepatology Communications | +4.1% |
| 2020-09-21 | Hepatology Communications | −20.1% |
| 2021-03-04 | Journal of Endocrinological Investigation | +8.7% |
after the filing, the company issued such documents
after the filing date, the company issued three 8-K filings. Only the item numbers are listed here. In 8-K filings without titles, the item numbers indicate the type of content, so one can determine whether it was an earnings announcement or a contract by the number. The specific event is read in the original text of each link.
- 2020-08-06 8-K Item 8.01, 9.01 — Other Events · Financial Statements and Exhibits
- 2020-08-24 8-K Item 8.01, 9.01 — Other Events · Financial Statements · Exhibits
- 2020-08-28 8-K Item 8.01, 9.01 — Other Events · Financial Statements · Exhibits
What this article does not answer
This article, which reads only abstracts, does not answer how the paper reviewed what method and what it showed up to where. How many times the paper cited by the company has been cited afterward can be checked again through the OpenAlexOpenAlex
Data source · Website citation count. What will be seen next is whether the company's next 8-K again cites the same paper.
Term explanation
- 8-K
- A periodic report submitted to the Securities and Exchange Commission when a listed company in the United States has something to inform its shareholders. The types are indicated by item numbers such as earnings, contracts, and executive changes. All the events in this article are derived from this document.
- Excess return
- The remainder obtained by subtracting the overall market return from the stock return. It is used to observe the movement of the company alone after removing the portion due to the overall market fluctuation.
- Trading day
- A date counted only on days when the stock market is open. Since weekends and holidays are excluded, 20 trading days correspond to approximately one calendar month.
- Sample and percentile
- A bundle of past cases of the same type is a sample, and the position from the bottom is expressed as a percentile. A percentile of 10 means that nine out of ten cases performed better than this case.
- Abstract
- A summary placed at the beginning of a paper. The author writes in a few sentences what was done, how it was done, and what results were obtained. Without reading the full text, one cannot know the details and limitations of the method.