May 15, 2023 5:00pm

Investors focus should be on debt ceiling talks, which were postponed to this week from Friday. Each day that goes by, and each postponement, each day there’s not a development … I think it will grow more and more difficult for the markets to really get any traction

Pre-Open Indications: 2 Hits and 1 Miss

I write this blog/newsletter to inform investors with facts and supporting numbers focused on what they need to hear that others will not say or write about - truth!  

Subscription is coming, it is not conscription but, an offer to join our collective of like-minded investors!  Join me … in the NO spin zone.

If I have learned one thing as a former research analyst in a venture and public fund, operating executive, adjunct (MBA) business school professor now a journalist; it is that your life and your portfolio are largely tied to your knowledge of price movements and questioning pricing targets.

 

The Dow closed UP +47.98 points (+0.14%), the S&P closed UP +12.20 points (+0.30%) while the Nasdaq closed UP +80.47 points (+0.66%)

 

Henry’omics:

We need to more than consider the economic environment - rising rates and inflation to comprehend the micro re “our” universe of cell and gene therapy companies.

Indexes cruised to a positive close as investors hoped that lawmakers can reach a deal in the debt-ceiling standoff, while assessing fresh economic data.

The ticking bomb of a potential debt default by the US government is front and center for investors again this week.

“Some bearish voices on Wall Street, including Morgan Stanley’s Michael Wilson, have warned that the debt-limit debate could trigger sharp swings in the equity market.” <Yahoo finance>

Economic Data Docket: Empire State Manufacturing survey, which showed a collapse in manufacturing activity in New York. The survey fell 43 points from April to a reading of -31.8, below the estimate of -5.

 

Monday (5/15) … RegMed Investors’ (RMi) pre-open: “dangerous time to be invested in equities? The debt-ceiling limit could be the biggest market concern.” … https://www.regmedinvestors.com/articles/12958

 

Pre-Open Indications: 2 Hits < Compass Therapeutics (CMPX +$0.065), uniQure NV (QURE -$0.22) and 1 Miss < Intellia Therapeutics (NTLA +$2.43)>  

 

RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened – differences …

  • Monday’s advance/decline line opened positive at 23 up/ 8 down and 4 flats, stayed positive with 29 up/ 6 down and 0 flat at the mid-day, ending with a positive close of 28/6 and 1 flat

 

Key Metrics:

The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:

  • Monday, the IBB was up +1.20% and the XBI was up +2.50%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Monday was up +0.22 points or +1.29% at 17.25

 

Closing Down (6 of 6):

  • bluebird bio (BLUE -$0.22 after Friday’s -$0.41),
  • uniQure NV (QURE -$0.22 after Friday’s -$0.26),
  • MiMedx (MDXG -$0.08),
  • Solid Biosciences (SLDB -$0.07),
  • Voyager Therapeutics (VYGR -$0.04 after Friday’s +$0.56),
  • Avrobio (AVRO -$0.0163),

 

Flat (1);

  • Brainstorm Cell Therapeutics (BCLI)

Closing Up (10 of 28):

  • Beam Therapeutics (BEAM +$2.66 after Friday’s -$1.85)
  • Intellia Therapeutics (NTLA +$2.43 after Friday’s -$1.29),
  • Regenxbio (GRNX +$2.38 after Friday’s +$0.13),
  • CRISPR Therapeutics (CRSP +$2.05 after Friday’s -$2.11),
  • Ultragenyx (RARE +$1.92),
  • Sage Therapeutics (SAGE +$1.62 after Friday’s -$0.91),
  • Vericel (VCEL +$0.96),
  • Alnylam Pharmaceuticals (ALNY +$0.84 after Friday’s -$0.73),
  • Ionis Pharmaceuticals (IONS +$0.73),
  • BioLife Solutions (BLFS +$ after Friday’s -$0.55),

 

Q2/23 – May

  • Monday closed positive with 28 incliners, 6 decliners and 1 flat
  • Friday closed negative with 10 incliners, 25 decliners and 0 flat

 

The BOTTOM LINE: I try to keep it simple … and short!

I follow the dictum, quoting Churchill that “short words are best, and the old words when short are best of all.”

A good beginning to the week and the sector as Sarepta Therapeutics (SRPT +$35.90 or +29.99%) gene therapy application surged following a key FDA committee's "yes" vote on its Duchenne drug Friday evening.

  • SRPT has been testing the gene therapy in patients with Duchenne muscular dystrophy, a muscle-wasting disease marked by the absence of the dystrophin protein. Dystrophin is necessary to keep the muscles intact. Sarepta's drug helps the body make a shortened form of that protein, called microdystrophin. The company is banking on the presence of microdystrophin to win an accelerated approval.

·         Eight panelists agreed Friday, saying microdystrophin in patients' muscles does suggest patients will have a functional benefit from the gene therapy. Six disagreed — in essence saying Sarepta's theory doesn't pan out. The FDA doesn't always follow the panel's recommendation, but it does consider the vote.

“The BIGGEST risk to the economy – the clock is ticking for a divided U.S. Congress to raise the federal government's debt ceiling, which currently stands at over $31 trillion but risks running out of cash as soon as June 1.

The lengthening standoff in Washington has added to economic worries, as a new non-partisan congressional report cited "significant risk" of a historic default within the first two weeks of June.

As I have stated, “The cell and gene therapy sector could experience yet another the “flight of Icarus” …  since “our” universe have oscillated between gains and losses since the first of 2023!”

 

There is VALUE out there however, it’s about playing or betting the timing of the sector. Even as I had stated, “I wouldn’t be buying into this rally … I would be selling into this upside!”

What’s SAFE … “No one company is immune in the sector and this market of rolling downdrafts?”

WILL Tuesday reflect … SUSTAINABILITY of share pricing.

A very appropriate quote, “You don't do well by trying to be right; it is impossible for humans. You do well by figuring out when you're wrong faster than others do.” <Nassim Nicholas Taleb>

 

There are clear winners — and losers — at the start of May.

The top three (3) performing in the week:

·         Monday: Beam Therapeutics (BEAM), Intellia Therapeutics (NTLA) and Regenxbio (RGNX)

While The worst three (3) in the week:

·         Monday: bluebird bio (BLUE), uniQure NV (QURE) and MiMedx (MDXG)

 

Earnings:

RegMed Investors (RMi) Research Note: Q1/23 earnings reporting dates, net losses, cash positions and runway outcomes … https://www.regmedinvestors.com/articles/12923  -

Sector earnings season is drawing to a close …

·         One (1) net income from 34 reported to date:

·         Biostage (OTCQB: BSTG) issued a 10-Q (late Friday), reporting a Q1/23 net loss of -$2.89 M or -$0.24 per share with a cash position of $3,369 M and a runway until Q4/2023:

·         Verve Therapeutics (VERV) reported another net loss.

·         Brainstorm Cell Therapeutics (BCLI) today - The FDA has still not set date for #NurOwn advisory panel meeting that the company is forcing the agency to convene.  Brainstorm is basically staying solvent by selling stock via its at-the-money (ATM) program

 

WHY (?) do I keep posting, so investors can get a daily update of the sector's share pricing and some individual companies TRUTHS while electronic trading chews on our portfolio edges.

I am definitely considered a contrarian depending on the session – one has to be a watcher of the ups and downs as well as measurer of sentiment. I am also a NO trust investor but, a validate and verify journalist/analyst.

 

The NO spin zone! U.S. public shareholders deserve accountability …

 

De-Listing Update:

Avrobio (AVRO) – Monday closed down -$0.0163 after Friday closed down -$0.0153 after Thursday closed down -$0.0205 to $0.65 after Wednesday closed down -$0.02 to $0.67, Tuesday closed down -$0.017, Monday closed up +0.01 to 0.71, Friday closed up +$0.04 to $0.70, Thursday closed down -$0.0093 to $0.655, Wednesday closed up +$0.01 to $0.66, Tuesday closed down-$0.168 to $0.65 after Monday closed down -$0.01596 to $0.83 after CEO Geoff MacKay resigned; still under Nasdaq minimum rule of $1.00; after thirty-one (31) sessions

·         Will AVRO do a reverse split to up-end delisting to “SCREW” shareholders yet, AGAIN?

Verastem Oncology (VSTM) Monday closed up +$0.0191 after Friday closed down -$0.0099 after Thursday closed down -$0.0160, Wednesday closed down -$0.004, Tuesday’s +$0.01, -$0.009 on Monday and last Friday’s -$0.0171; two hundred and four (204) sessions under the Nasdaq $1.00 minimum pricing

 

Biostage (OTCQB: BSTG) …

·         Monday closed up +$0.32 with 326 shares traded after Friday closed down -$0.21 with 3,430 shares traded, Thursday closed FLAT with 50 shares traded, Wednesday closed up +$0.07 with 125 shares traded, Tuesday closed down -$0.01 with 120 shares traded, Monday close FLAT and last Friday closed down +$0.01 with 215 share traded, <3-month average =1,477 shares>

·         Question: Review the number of shares traded … is OTCQB: BSTG a Ponzi scheme (with their pump/promote buy and sell agenda) as shares are bought to replace those sold?

·         CEO Jerry, you should listen to Biostage’s critics to focus to the future, their insight could help you … over the sentiment speedbumps!

·         The past management team is and was disconnected with US investors and I-Banks; so, it behooves the new CEO to connect with a more solid story and reduce those who have brought the company to its toes!

·         Accumulated deficit:  $85,901 M

 

My question that resounds, that should be asked is how many companies are at the end of sentiments …  leash?

 

Opinions expressed are those of the author and are subject to change, and not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

Whether information or intelligence is good, bad or somewhere in between; I put into context what is relevant and useful for investors.  All investments are subject to risks. Investors should consider investment objectives.

Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication.

Regulation Analyst Certification (Reg AC): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.