February 16, 2021 5:30pm
As the stem, cell and gene therapy sector run out of buyers, it also runs into trouble (just like a fire that runs out of wood) especially as earnings’ season ramps
Pre-open indication results: 5 HITs and 4 MISS
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The Dow closed UP +64.35 points (+0.20%); the S&P closed DOWN -2.24 points (-0.06%) while the Nasdaq closed DOWN -47.97 points (-0.34%)
Henry’omics - more than a snapshot of today’s sector movements:
Indexes upped, downed and cut gains in volatile trading on Tuesday, although hovering near record levels.
- The Dow closed up, after briefly erasing a 150-point gain to dip into negative territory; while the S&P 500 was down, pressured by declines in health care and real estate while the Nasdaq fell -0.3% ... although all three (3) major averages had hit record highs earlier in the day.
The threat: bond pricing, the 10-year Treasury yield topped 1.25% for the first time since March and jumped 9 basis points to hit a fresh one-year high of 1.30%.
- The benchmark 10-year Treasury yield, used as a barometer for mortgages, student loans and credit card annual percentage rates, wallowed around 0.6% for much of 2020.
- The worry is … that a rebound in rates could hinder the economic recovery from the pandemic-induced recession as companies and consumers may find it increasingly expensive to borrow.
- At the same time, some wonder if a deluge of fiscal stimulus could spark a rise in prices after a decade of dormant inflation.
Who and what’s hot today:
Athersys (ATHX -$0.01) announced that Dr. Gil Van Bokkelen has stepped down as Chairman and Chief Executive Officer, effective immediately.
- ATHX’s board has appointed B.J. Lehmann, its President and COO, as Interim CEO.
bluebird bio (BLUE -$17.32) temporarily suspended all studies of a sickle cell disease gene therapy prompting BLUE’s stock to collapse. Shares hit a seven-year low in early trading.
- A patient treated more than five years ago with the gene therapy, dubbed LentiGlobin, was diagnosed with acute myeloid leukemia. Acute myeloid leukemia is a type of blood cancer.
- BLUE is investigating the cause of the patient's leukemia to determine if there is any connection to the gene therapy.
The Cboe Volatility Index, widely viewed as a fear gauge, broke below 21.46 after 19.97 on Friday, marking the first significant breach of the threshold since the pandemic-induced sell-off began in February 2020.
- However, stocks reversed lower as the VIX edged higher again. The gauge last traded up more than 1.49 point above 21.46.
- The crack of the 20 level is viewed by some as a big “risk on” signal, which could trigger buying from algorithmic traders and other big players. The gauge last traded up about one point to 21 on this morning. <CNBC>
Cytovia Therapeutics (a private NK cell therapeutics company) and Cellectis SA (NASDAQ: CLLS) have entered into a strategic R&D collaboration to develop TALEN gene-edited induced pluripotent stem cells (iPSC) Natural Killer (NK) and Chimeric Antigen Receptor (CAR)-NK cells.
- CLLS will receive up to $760 million in milestone payments from Cytovia for the first five TALEN gene-edited iPSC-derived NK products. It will also receive single-digit royalty payments on the net sales.
- CLLS will also receive an equity stake of $15 million in Cytovia stock or an upfront cash payment of $15 million if certain conditions are not met by December 31, 2021, as well as an option to invest in future financing rounds.
- The agreement utilizes Cellectis' gene-editing technology, TALEN, to yield NK and CAR-NK treatments with improved potency, persistence, and safety for various cancers, including solid tumors. Cytovia's CAR-NKs are expected to enter clinical trials by 2022.
- Pricing of the move: CLLS moved +0.59%% or +0.16 higher at $27.33.
RegMed Investors’ (RMi) pre-open: “Who fore art thou? What do analysts do, they separate actionable indications and news into a short-term investment thesis to tackle the “unknown unknowns”. What if I was to tell you the single biggest determinant of one’s success, is a skill at questioning? … https://www.regmedinvestors.com/articles/11770
Pre-open indication results: 5 HITs < SELL: Biostage (BSTG -$0.03 with 1,243 shares “pumped”); SELL into Strength: Bellicum Pharmaceuticals (BLCM +$0.38 – a profit), CRISPR Therapeutics (CRSP -$5.73), Editas Medicine (EDIT -$1.49); SELL (BLUE -$17.32) and 4 MISS < Alnylam Pharmaceuticals (ALNY -$4.11), Ultragenyx (RARE -$5.92), Athersys (ATHX -$0.01), REGENXBIO (RGNX -$0.71)>
RegMed/Stem/Cell and Gene therapy’s 35 covered equities’ Advance/Decline (A/D) lines: progressions and regressions …
- Tuesday opened negative at 15/18 and 2 flats, strayed barely positive at the mid-day to 17/16 and 2 flats, closing negative at 14/20 and 1 acquired;
- Monday was a market holiday
There are clear winners — and losers — heading into the second month and Q1 of 2021.
52-week all-time high:
- Applied Genetic Technologies (AGTC) was up +36.41% or +$2.34 to $8.48, then settling at $8.07 (+$1.89 or +30.58%) on WHAT news… offering completed, un-named presentation at another virtual … OIS Gene Therapy Innovation Showcase?
Jumping with share pricing momentum:
- Applied Genetic Technologies (AGTC), Global Blood Therapeutics (GBT), ReNeuron (RENE.L), Vericel (VCEL), Intellia therapeutics (NTLA) to name 5 of the 14 declining of the 35 covered
Hammered in today’s market:
- bluebird bio (BLUE), Alnylam Pharmaceuticals (ALNY), CRISPR Therapeutics (CRSP), Ultragenyx (RARE), Editas medicine (EDIT) to name 5 of the 20 declining of the 35 covered
Sector volume was LOW with 6 of the 14-upside having higher than the 3-month average volume with the increased volume of 4 of 20-downside having higher than the 3-month average volume;
Tuesday’s percentage (%) of the 14-upside were +0.07% (ADVM) to +30.58% (AGTC) while the 20-downside ranges from -0.13% (PSTI) to -37.85% (BLUE);
Tuesday’s (14 of 14) incliners, keep your “profiting” eyes on some of these upsides:
- Applied Genetic Technologies (AGTC +$1.89 following Friday’s +$0.28, Thursday’s +$0.75 and Wednesday’s +$0.24);
- Global Blood Therapeutics (GBT +$1.64 following Friday’s +$0.96);
- ReNeuron (RENE.L +$1.50 following Friday’s +$12.00 after Thursday’s +$6.00, Wednesday’s +$2.50 and last Tuesday’s -$5.00);
- Chinook Therapeutics (KDNY +$0.52);
- Vericel (VCEL +$0.49 following Friday’s +$1.45 and Thursday’s +$1.04);
- Bellicum Pharmaceuticals (BLCM +$0.38 following Friday’s +$0.70, Thursday’s +$0.66, Wednesday’s +$0.31 and last Tuesday’s +$0.21);
- Cellectis SA (CLLS +$0.16 following Friday’s +$0.29 after Thursday’s +$0.61;
- AxoGen (AXGN +$0.15 following Friday’s -$0.30);
- Voyager Therapeutics (VYGR +$0.12);
- Verastem (VSTM +$0.11);
- Caladrius Bioscience (CLBS +$0.11 following Friday’s -$4.00, Thursday’s +$0.39, Wednesday’s +$0.04 and last Tuesday’s +$0.07);
- Homology Medicine (FIXX +$0.08);
- Adverum Biotechnologies (ADVM +$0.01 following Friday’s -$0.45 and Thursday’s +$0.11);
Tuesday’s (10 of 20) decliners:
- bluebird bio (BLUE -$17.32);
- Ultragenyx (RARE -$5.92);
- CRISPR Therapeutics (CRSP -$5.73);
- Alnylam Pharmaceuticals (ALNY -$4.11);
- Sage Therapeutics (SAGE -$2.05);
- Editas Medicine (EDIT -$1.49);
- Ionis Pharmaceuticals (IONS -$0.86);
- uniQure NV (QURE -$0.71);
- Solid Biosciences (SLDB -$0.50);
- Mesoblast (MESO -$0.42);
Closing 1 - Stemline Therapeutics (STML – acquired)
Sentiment and COVID-19 infections:
- The Biden administration will send out 13.5 million doses of Covid-19 vaccine per week to states going forward, up from 11 million last week, and also double the number of doses sent directly to retail pharmacies.
Infection cases <Million>: never to forget …
- Tuesday 27.69 M cases,
- Tuesday’s death rate totaled 486,520 <Johns Hopkins University>
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Tuesday, the IBB closed down -2.17% and XBI closed down -2.53%
The CBOE Volatility Index (VVIX: INDEX) tracked:
- Tuesday was up +1.49 points or +4.76% at 21.46
Upside volume: low
- Tuesday: 6 out of the 14-upside had higher than the 3-month average volume;
Downside volume: low
- Tuesday: 4 out of the 20-downside had higher than the 3-month average volume;
Percentage (%) movement/range statistics: % and pricing drop
- Tuesday’s percentage (%) of the 14-upside were +0.07% (ADVM) to +30.58% (AGTC) while the 20-downside ranges from -0.13% (PSTI) to -37.85% (BLUE);
February, the 2nd month of Q1 … a visual review identifies the range of sector volatility
Tuesday closed negative with 14 advancers, 20 decliners and 1 acquired
Monday (2/15) was a market holiday
Friday closed negative with 14 advancers, 19 decliners, 1 flat and 1 acquired
Thursday closed positive with 13 advancers, 21 decliners and 1 acquired
Wednesday closed negative with 8 advancers, 25 decliners, 1 flat and 1 acquired
Tuesday closed negative with 11 advancers, 23 decliners and 1 acquired
Monday (2/8) closed positive with 27 advancers, 7 decliners, 1 flat and 1 acquired
Friday closed positive with 28 advancers, 6 decliners and 1 acquired
Thursday closed positive with 27 advancers, 7 decliners and 1 acquired
Wednesday closed positive with 17 advancers, 16 decliners, 1 flat and 1 acquired
Tuesday closed positive with 25 advancers, 7 decliners, 2 flats and 1 acquired
Monday (2/1) closed positive with 22 advancers, 11 decliners, 1 flat and 1 acquired
The Bottom Line: One holiday and one (1) session into the week as the Dow has gained 5.1% in February, while the S&P 500 jumped +5.9% and the Nasdaq rallied +7.5%.
I FEEL a “risk-on” signal … ask yourself a question, Are storm clouds on horizon? While the sector is surging now, will it last?
Forewarned … earnings LPS (loss-per-share) season is coming quickly – my advice, trim and skim!!
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.