June 29, 2022 5:17pm

As June and Q2 come to an end tomorrow

Pre-open indications: 7 HITs and 1 Puff/Pump/Promote

WHY and HOW is this market affecting the cell and gene therapy sector … “The Bottom Line” underlines the framework of share pricing actions.  Who else is tracking a broad grouping of cell and gene therapy equities – can you afford to not read facts supported by real numbers?

No tunnel vision here, the velocity of decline obstructs the ebb and flow of the session

Investors should read as I DEVOTE a HUGE amount of time to “reckoning” the geography of my coverage group

If I have learned one thing as a former research analyst, venture and public fund investor now a journalist; it is that your life and your bank account are largely tied to your knowledge of price movements and questioning pricing targets.

 

The Dow closed UP +82.32 points (+0.27%); the S&P closed DOWN -2.72 points (-0.07%) while the Nasdaq closed DOWN -3.65 points (-0.03%)

 

Henry’omics:

Indexes fluctuated on Wednesday, after the major averages dived for two (2) sessions as the market prepares to close out the worst1H (first half) of the year since 1970.

Disappointing consumer confidence data halted those advances and sent stocks tumbling.

U.S. gross domestic product was revised down in the third estimate for Q1. It was changed to a 1.6% year-over-year drop from the previous estimate for a 1.5% decline. This is the first economic contraction since Q2 of 2020. Analysts had expected no revision.

Economic Data Docket: Today Federal Reserve Bank of Cleveland President Loretta Mester said she will advocate for a 75-basis point hike to interest rates at the central bank’s July meeting if economic conditions remain the same by then. <CNBC>

 

All-time low:

  • Mesoblast (MESO) at $2.21

 

RegMed Investor’s (RMi) Pre-Open: “any attempt to kick-up share pricing is a good but, weak ask as the Q2 comes to an end on Thursday, there are rising fears for “our” cell and gene therapy sector” … https://www.regmedinvestors.com/articles/12493

 

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

  • Wednesday opened negative at 5 up/ 29 downs and 1 flat, stayed negative at the mid-day to 14/20 and 1 flat, ending with a positive close of 21/14.

 

Pre-open Indications: 7 HITs < AGENUS (AGEN +$0.20), BioLife Solutions (BLFS -$0.10), Verve Therapeutics (VERV -$0.17), Chinook Therapeutics (KDNY +$0.02), Intellia Therapeutics (NTLA +$0.40), Beam Therapeutics (BEAM +$0.02), Editas Medicine (EDIT -$0.22)> 1 Puff/Pump/Promote < Biostage (BSTG $0.15 with 1,015 shares traded)>

 

Key Metrics: review the volume disparities between daily sessions …

  • Wednesday - Sector volume was LOW with 5 of the 21-upside having higher than the 3-month average volume with LOW volume of 2 of 14-downside having higher than the 3-month average volume;

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

  • Wednesday, the IBB was up +0.54% and the XBI was up +1%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Wednesday was down -0.24 points or -0.85% at 28.12

 

Jumping with share pricing momentum (10 of 21):

  • Alnylam Pharmaceuticals (ALNY +$3.23 after Tuesday’s -$4.29 and Monday’s -$1.01),
  • Global Blood Therapeutics (GBT +$2.44 after Tuesday’s +$0.09 and Monday’s -$2.04),
  • Ultragenyx (RARE +$1.51 after Tuesday’s -$2.45 and Monday’s +$0.61),
  • Vericel (VCEL +$0.96 after Tuesday’s -$1.28),
  • bluebird bio (BLUE +$0.54),
  • Intellia Therapeutics (NTLA +$0.40 after Tuesday’s -$1.37),
  • Sage Therapeutics (SAGE +$0.27 after Tuesday’s -$2.39 and Monday’s +$1.28),
  • Agenus (AGEN +$0.20),
  • Voyager Therapeutics (VYGR +$0.18),
  • Biostage (BSTG +$0.15 after Tuesday’s +$0.20 after Monday’s $0.00),

Closing down (14 of 14):

  • CRISPR Therapeutics (CRSP -$0.28 after Tuesday’s -$3.62),
  • Ionis Pharmaceuticals (IONS -$0.41 after Tuesday’s -$1.37 after Monday’s +$0.09),
  • Editas Medicine (EDIT -$0.22),
  • AxoGen (AXGN -$0.19),
  • Verve Therapeutics (VERV -$0.17),
  • Caribou Biosciences (CRBU -$0.12),
  • Regenxbio (RGNX -$0.12 after Tuesday’s -$1.47 and Monday’s -$0.65),
  • uniQure NV (QURE -$0.10),
  • BioLife Solutions (BLFS -$0.10),
  • Precigen (PGEN -$0.08 after Tuesday’s +$0.05),
  • Cellectis SA (CLLS -$0.04),
  • Brainstorm Cell Therapeutics (BCLI -$0.02 after Tuesday’s +$0.03 after Monday’s +$0.05),
  • Mesoblast (MESO -$0.01),
  • Solid Biosciences (SLDB -$0.0034 after Tuesday’s +$0.0385),

 

June, Q2/2022:

  • Wednesday closed positive with 21 incliner, 14 decliners 
  • Tuesday closed negative with 8 incliner and 27 decliners
  • Monday (6/27) closed negative with 11 incliner, 22 decliners and 2 flats

 

The BOTTOM LINE: Good quote from someone else ...captures the essence of the sector and market, “We expect significant volatility this summer, with ‘face-ripping’ short-covering rallies followed by economically-inspired market slumps,” Wells Fargo senior equity analyst Christopher Harvey said in a note Wednesday. “While a much-anticipated market ‘washout’ could catalyze a more sustained move higher, we think the market will not sustain a rally until it believes the Fed will toggle from a 50-75bp tightening to a more mundane 25bp increase.”

Being “greedy when others are fearful” is easier said than done.

What I provide is an intelligence daily. RMi outlines a daily bell weather of “indications” about what you need to know; it’s what could happen or materialize after the opening and what might happen during the session.

Runways” and trial status will be paramount factors in earnings reporting

Wednesday and Tuesday are “surfing” wipe-outs, after a drubbing from two (2) sessions of losses on Monday, that followed two (2) positive closes; the sector resume its downward trend Tuesday as the Nasdaq climbed as much as 1% but reversed lower to a loss of 0.6%.

At some point this aggressive selling is going to dissipate but it doesn't seem like it's going to be anytime soon.

Cell and gene therapy equity investors remain closely attuned to deceleration of share pricing with inflation continuing to run at multi-decade highs and monetary policymakers maintaining a firm stance that their priority remains bringing down prices even at the expense of some growth.

Question, BUY the dips or put gas in the car to overpay at the supermarket!

With quarterly corporate earnings season set the pick-up in the next few weeks, the focus will soon shift to how companies have been “dimed” (i.e., 10%) percentage down navigating persistent conviction issues alongside softening sentiment.

I think we're going to have a 2H (second half) that's frustrating investors and frustrating the shorts - hedge funds and freaking-out long-term holders, bouncing around the economy slowing,

Share pricing is fluctuating as the sector and market rebalance with the month, 1H and quarter comes to a close.

Something I disdain and infrequently write about are … Price Targets … they have gotten so bad and inflated yet have NOT been reset.

Also, many i.e., most cell and gene therapy companies have NOT reset their internal stock award plans – so another disenfranchised investor (and employees) have their ire elevated as loyalty drains their capacity to be loyal and waiting for the next headhunter call.

We always need a villain and they are multiplying.

I try to keep it simple and short … because there’s so much worry that people use any piece of good news as a chance to sell – it has become a process of developing ROI (return of investment).”

Reiterating, I believe there will be opportunity in cell and gene therapy equities but, the summer doldrums are still a roadblock. This period of volatility will likely last into the second half of the year.

However, the continuing state of volatility confirms fears that I have been expressing these daily and weekly posts.

I stick to my view of anticipating the risks – as my careers focus has been “warning analysis”.

 

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.