February 14, 2023 5:04pm

As the first hour flip flops while CPI exposure expands the downside’s volatility

Pre-open indications 5 Hits and 1 Miss

News: The highs and lows of the drug development rollercoaster; Magenta Therapeutics (MGTA) will cease operations eliminating 56 jobs (84% of staff including execs). <read more>

The Biostage (OTCQB: BSTG) Chronicles: pumping the volume (2,058 shares traded (3-month volume =1,303 shares) and promoting the share pricing (+$0.96) keeps occurring; value balloons as Chinese majority ownership and management team floats these “objects”. Question: when will the SEC respond to a “possible” Ponzi scheme?

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

Subscription is coming, it’s 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 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 DOWN -156.66 points (-0.46 %); the S&P closed DOWN -1.16 points (-0.03%) while the Nasdaq closed UP +68.36 points (+0.57%)

 

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 wavered Tuesday while the Dow fell, reversing earlier gains, after the January consumer price index report showed that inflation grew, slightly higher than expected.

Economic Data Docket: The consumer price index accelerated 0.5% for the month, which translated to an annual gain of 6.4%.

  • Excluding volatile food and energy, core CPI increased 0.4% monthly and 5.6% from a year ago, against respective estimates of 0.3% and 5.5%.
  • Money market traders are betting on at least two more 25 basis point rate hikes this year, with interest rates seen peaking at 5.28% by July.
  • Also adding to the investor angst were hawkish remarks by Richmond Fed President Thomas Barkin and Dallas Fed President Lorie Logan. Barkin said the Fed needs to prioritize quashing inflation over risks to U.S. economic growth.

 

Sign of the times and another sad news for our sector: Magenta Therapeutics (MGTA) will be exploring strategic alternatives, including asset sales and merger paths. MGTA had been developing stem cell-based drugs for myeloid leukemia, myelodysplastic syndrome, multiple myeloma and sickle-cell disease, among others. Last spring, the company set aside most of its drugs in favor of one called MGTA-117, which was designed to treat myeloid leukemia and myelodyspastic syndrome and had shown some promising data. But last month, Magenta revealed that MGTA-117 had "possibly" been responsible for a patient death. When it does shut down, Magenta will be the third local (New England) biotech to do so this year and at least the 10th in the last 13 months.

 

Tuesday’s … RegMed Investors’ (RMi) pre-open: “Keeping track of who’s up or going down, good or bad news, a CPI gauge today. There are four (4) phases of the stock cycle: accumulation; markup; distribution; and markdown” …  https://www.regmedinvestors.com/articles/12833

 

Pre-open indications: 5 Hits <Brainstorm Cell Therapeutics (BCLI +$0.17), Verve Therapeutics (VERV +$0.62), Sage Therapeutics (SAGE -$0.36), Prime Medicine (PRME -$0.72), Intellia Therapeutics (NTLA -$0.54)> and 1 Miss < CRISPR Therapeutics (CRSP -$0.64)>

 

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

  • Tuesday’s advance/decline line opened negative at 11 up/ 22 down and 2 flats, at 10 a.m. was 23/11 and 1 flat flipped negative with 7 up/ 28 down and 0 flat at the mid-day, ending with a negative close of 13/22 and 0 flat
  • Monday’s advance/decline line opened negative at 10 up/ 23 down and 2 flats, flipped positive with 23 up/ 11 down and 1 flat at the mid-day, ending with a positive close of 18/17 and 1 flat

 

Key Metrics:

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

  • Tuesday, the IBB was down -0.31% and the XBI was up +0.37%
  • Monday, the IBB was up +1.38 % and the XBI was down -0.07 %

The CBOE Volatility Index (VVIX: INDEX) tracked: illuminating the changes

  • Tuesday was down -1.43 points or -7.03% at 18.91
  • Monday was down -0.19 points or -0.93% at 20.34

 

Closing Down (10 of 22):

  • uniQure NV (QURE -$0.78 after Monday’s -$0.06),
  • Prime Medicine (PRME -$0.72 after Monday’s +$1.30),
  • CRISPR Therapeutics (CRSP -$0.64 after Monday’s +$1.73),
  • Ultragenyx (RARE -$0.56 after Monday’s -$0.19),
  • Intellia Therapeutics (NTLA -$0.54 after Monday’s +$1.35),
  • Ionis Pharmaceuticals (IONS -$0.46 after Monday’s +$0.67),
  • Sage Therapeutics (SAGE -$0.36 after Monday’s +$0.27),
  • Voyager Therapeutics (VYGR -$0.30),
  • BioLife Solutions (BLFS -$0.29 after Monday’s -$0.12),
  • Solid Biosciences (SLDB -$0.20),

Closing Up (13 of 13):

  • Alnylam Pharmaceuticals (ALNY +$2.57 after Monday’s +$7.08),
  • Biostage (OTCQB: BSTG +$0.96),
  • Verve Therapeutics (VERV +$0.62 after Monday’s +$0.69),
  • Vericel (VCEL +$0.25 after Monday’s +$0.44),
  • Brainstorm Cell Therapeutics (BCLI +$0.17 after Monday’s -$0.32),
  • Editas Medicine (EDIT +$0.14),
  • MiMedx (MDXG +$0.04 after Monday’s +$0.25),
  • Caribou Biosciences (CRBU +$0.03 after Monday’s -$0.05)
  • Homology medicine (FIXX +$0.03),
  • Cellectis SA (CLLS +$0.03),
  • AxoGen (AXGN +$0.03 after Monday’s -$0.14),
  • Precigen (PGEN +$0.01 after Monday’s -$0.09),
  • Adverum Biotechnologies (ADVM +$0.003),

 

Q1/23 – February

  • Tuesday closed negative with 13 incliner, 22 decliners and 0 flat
  • Monday closed positive with 18 incliner, 16 decliners and 1 flat

 

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

The sector took a hit by an inflation report after Monday’s oversold were recognized and discarded on Tuesday after the CPI tumbled the sector … as sector sentiment is STILL governed by electronic trading and algorithms.

I do NOT believe there aren't a lot of cell/gene therapy companies in position yet – UNTIL earnings (Q4) are reported – any breakout is a false hope with the inevitable downside re-occurring – it was TRUE again today, Friday.

Upcoming Q4 earnings reporting will present challenges to share pricing.

·         Sage Therapeutics (SAGE) 2/16 – Thursday

·         Ultragenyx Pharmaceuticals (RARE) 2/16 - Thursday

·         Ionis Pharmaceuticals (IONS) 2/22 – Wednesday

·         Alnylam Pharmaceuticals (ALNY) 2/23 – Thursday

·         Vericel (VCEL) 2/23 – Thursday

·         Fate Therapeutics (FATE) 2/28- Tuesday

If you thought of buying on weakness, you might be jumping onto a sinking ship.

 

There are clear losers today … uniQure NV (QURE), Ultragenyx (RARE) and CRISPR Therapeutics (CRSP)

With winners … Alnylam Pharmaceuticals (ALNY), Biostage (OTCQB: BSTG) and Verve Therapeutics (VERV)

 

Biostage (OTCQB: BSTG)

Tuesday’s +$0.96 with 2,105 shares traded after Monday’s +$0.08 with 300 shares traded, Friday’s -$0.20 with 3,961 shares traded, Thursday’s flat with 0 shares traded, Wednesday -$0.01 with 100 shares traded, and last Tuesday’s -$0.01with 2,300 shares traded and last Monday flat with 0 shares traded. <3-month average volume = 1,301 shares>

·         BSTG has “pulled” its proposed offering … “Withdrawal of Registration Statement on Form S-1 (File No. 333-265741)”

·         This IND – now almost 4 years old without a clinical trial that will last 3-5 years for ADULT patients before BSTG can EVEN consider a pediatric venue!

·         Question; is OTCQB: BSTG a Ponzi scheme (the pump/promote buy and sell agenda) as shares are bought to replace those sold??

 

 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.