November 11, 2022 7:45am
Market dynamics based on CPI inflation report, earnings results along with regulatory and pipeline updates (usually failures) continue to keep the cell and gene therapy sector in play
Earnings: Homology Medicine (FIXX) a Q3 net loss of -$33.7 million or -$0.59 per share with a cash position of $202.1 million and a Q4/24 runway. Bellicum Pharmaceuticals (BLCM) a Q3 net loss of -$7.2 million or -$0.23 per share with a cash position of $28.8 million and a 2023 runway. Adverum Biotechnologies (ADVM) a Q3 net loss of -$40.1 million or -$0.40 per share with a cash position of $203.3 million and a 2025 runway. Chinook Therapeutics (KDNY) a Q3 net loss of -$56 million or -$0.83 per share with a cash position of $397.7 million and a 2025 runway.
Indications: 1 Maintain SELL, 4 Sell into Strength, 8 Negative Indication and 1 Pump/Promote
A daily report may say little or a lot and its final judgement may be inconclusive; yet it serves as insurance that all indications are being examined, evaluated and reported.
Why do I keep writing this blog/newsletter to inform investors, what they need to hear that others won’t say or write!
8:00 a.m. edition
Remember that overnight and pre-open actions in futures don't necessarily translate into actual trading in the coming day’s session.
Dow futures are UP +0.45% or (+153 points), S&P futures are UP +0.47% or (+18 points) and NASDAQ futures are UP +0.53% or (+62 points) early in the pre-open – so far,
Stock futures rose Friday,
European markets were guardedly higher,
Asia-Pacific markets also were higher.
We need to understand the macro to comprehend the micro re “our” universe of cell and gene therapy companies …
Indexes surged following the October CPI inflation report … however, core price gains were lower than expected, bolstering the case for slower Fed rate hikes.
Thursday, the Dow closed UP +1,198.27 points (+3.69%), the S&P closed UP +207.31 points (5.53%) while the Nasdaq closed UP +760.97 points (+7.35 %).
The stock market rally started strong and remained so throughout Thursday, closing at session high
Economic Data Docket: November University of Michigan consumer sentiment numbers remain on watch after October's high 59.9 reading. Forecasters expect no change in this barometer for the economy.
Thursday’s (11/10) … RegMed Investors’ (RMi) closing bell: “the risk-on fervor sent markets skyward and sector upward. Markets look past midterms conundrum; but, I'd be SELLING some highs early Friday” … https://www.regmedinvestors.com/articles/12695
RegMed Investors (RMi) research note: BrainStorm Cell Therapeutics Inc. (NASDAQ: BCLI) Shut-down by FDA on New Biologics License Application (BLA) for the ALS treatment with NurOwn … https://www.regmedinvestors.com/articles/12694
Ebb and flow:
Q4 – November - 6 negative and 3 positive closes
· October -1 neutral, 11 positive and 9 negative closes
· September – 1 holiday, 10 positive and 11 negative closes
· August – 1 neutral, 11 positive and 11 negative closes
· July - 1 holiday, 10 negative and 10 positive closes
Companies in my headlights – It’s your decision; I provide ideas and context: INDICATIONS
Avrobio (AVRO) closed flat at $0.00 to $0.66 with a positive +$0.02 or +2.94% pre-open indication with earnings release with a net loss of -$23 million or -$0.52 per share and a cash position of $116 million with a runway until Q4/23. Notice the filing of an S-3 (11/8/22) with a draft prospectus by Cowen – a screw-job for early and present investors – they are being wiped-out by management! Check website! Also note, today is AVRO 54th session under Nasdaq’s delisting notice.
Negative Indications: understanding after-market and pre-open trading …
Prime Therapeutics (PRME) closed up +$1.05 with a negative indication of -$1.02 or -4.96% indication
Chinook Therapeutics (KDNY) closed up +$0.46 with a negative -$0.46 or -2.05% indication
bluebird bio (BLUE) closed up +$0.87 with a negative -$0.08 or -1.13% indication
Ionis Pharmaceuticals (IONS) closed up +$2.41 with a negative -$0.47 or -1.03% indication
Mesoblast (MESO) closed up +$0.21 with a negative -$0.10 or -3.30% indication
Ultragenyx Pharmaceuticals (RARE) closed up +$3.86 with a negative -$0.58 or -1.54% indication
Solid Biosciences (SLDB) closed up +$0.14 with a negative -$0.30 or -4.62% indication
Vericel (VCEL) closed up +$4.76 with a negative -$1.13 or -5.04% indication
Sell into Strength:
CRISPR Therapeutics (CRSP) closed up +$5.76 with a positive +$0.80 or +1.46% indication
Intellia Therapeutics (NTLA) closed up +$4.45 with a positive +$0.82 or +1.55% indication
BioLife Solutions (BLFS) closed up +$7.40 with a positive +$0.26 or +1.05% indication
Fate Therapeutics (FATE) closed up +$2.19 with a positive +$0.17 or +0.81% indication
Puff/Pump and Promote: Maintaining SELL
Biostage (OTCQB: BSTG) closed down -$0.58 with 160 shares traded after Wednesday’s -$0.01 with 314 shares traded +$0.76 with 1,880 shares traded and last Friday’s +$0.01 with 2,953 shares traded following the previous Thursday’s -$0.09 with 800 shares traded, Wednesday’s -$0.05 with 100 shares traded, Tuesday’s flat with 963 shares traded following Monday’s -$0.85 with 2,100 shares traded <3-month average = 2,446 shares>
A DRAFT prospectus is filed … SEC Form S-1/A …https://app.quotemedia.com/data/downloadFiling?webmasterId=101533&ref=117017206&type=HTML&formType=S-1%2FA&dateFiled=2022-10-27&cik=0001563665&CK=1563665&symbol=0001563665&companyName=Biostage . Questions arise as to draft prospectus statement of non-reliance of past financials? Hey, CFO Joe some of us have copies of lost “payables”?
The BOTTOM LINE: The sector soared to new heights after Wednesday’s negative close, Tuesday’s positive close and Monday’s negative close following last Friday’s negative close.
Reiterating, “I try to keep it simple … and short …
What changes … “No one company is immune in the sector and this market of rolling downdrafts?”
Reiterating, “Kenny Storch at BTIG, states there are 226 public biotech companies trading below cash currently; with 1 out of 5 in the Nasdaq Biotech Index trading below cash.”
Is it a sign of the times for a few gene therapy companies to end-up like RUBY (Rubius Therapeutics – seeking “strategic alternatives”, AGTC – running out of money – getting acquired by shell, AVRO and VSTM with delisting hanging over their head like a sword of Damocles (?) or BEAM (Beam Therapeutics (dropping trial) or even Verve Therapeutics (VERV) getting IND halted by FDA.
Faze Medicines, a neuroscience-focused startup that spun out of Third Rock Ventures in late 2020, is winding down. Clovis Oncology, a maker of cancer drugs, will likely file for bankruptcy protection due to dwindling sales of its sole product, mounting financial losses, and a crushing debt load.
Let’s not, forget Thursday’s FDA refusal of Brainstorm Cell Therapeutics (BCLI) BLA filing as its share price fell -$1.2 or -42.21% to $1.67.
WHO or WHICH are NEXT …?
CEO salaries, spending within G&A are totally OUT-OF-WHACK; these are companies in early development stages and will be for years without products in most cases not like the tech companies, whose CEOs and management teams think sector management teams should be compared to for bi-weekly cash and “beanies”!
We will be seeing what November brings – Q3 earnings LPS (loss-per-share) season and a whole lot of economic indicators.
Q4 is HERE and we are back into Q3 earnings season which could be a minefield:
· Still more on way to be announced.
Investors are still struggling … to HOLD-on for sector share pricing direction and wanted clarity of guidance in earnings … and TRIALS that are to begin in earnest
If you have gains, you might want to lock-in profit (if any) … before earnings season begins!
DISPOSE of Avrobio (AVRO) who experiences news and the stock drops after a de-listing notice while the management DID NOTHING to AVOID this dilemma while president, CEO and director Geoff Mackay carries home a HUGE salary of $754.39 K per year?
· AVRO is NOT close to the $1.00 to continue its Nasdaq listing after a delisting notice.
· What is the solution to “solve” the de-listing “position” on Nasdaq …?
AVRO has filed a DRAFT S-3 prospectus to “commission" an OFFERING by Cowen to address its delisting? https://investors.avrobio.com/node/9116/html
· Let’s NOT forget … AVRO’s 53nd session under $1.00 i.e., delisting
Isn’t this Verastem Oncology’s (VSTM) its 35th session of being UNDER $1.00 heading for de-listing under Nasdaq (NO notice yet).
· When it comes time to invest or even hold onto an investment; I’d say … focus on what percentage ownership of stock … NOT options CEOs and management teams own versus their salary and bonus.
Insight is about understanding perception and also about putting into context what is relevant to expectation fulfillment
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.
All investments are subject to risks. Investors should consider investment objectives.
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.
Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions securities referred to in this publication.