August 25, 2023 5:13pm

 The cell and gene therapy sector has been lost in the mist of uncertainty

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Week in review

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

 

The Dow closed UP +247.48 or +0.73%, the S&P closed UP +29.40 or +0.67% while the Nasdaq closed UP +126.67 points (+0.94%)

 

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 rallied Friday as traders cheered comments from Fed Chair Powell at the annual central bank conference in Jackson Hole, Wyoming, that point to stronger-than-expected economic growth.

Economic Data Docket: FedChair Powell called for more vigilance in the fight against inflation, warning that additional interest rate increases could be yet to come.

 

Friday (8/25) … RegMed Investors’ (RMi) Opening Bell: “share pricing versus Jerome. Fed chief Powell's speech today has big implications for rate hikes and investors after stocks suffered a big reversal Thursday.” … https://www.regmedinvestors.com/articles/13094

 

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

  • Friday’s advance/decline line opened negative at 16 up/ 19 down and 0 flat, strayed positive with 19 up/ 16 down and 0 flat at the mid-day, ending with a positive close of 22 incliners, 12 decliners and 1 flat
  • Thursday’s advance/decline line opened negative at 9 up/ 25 down and 2 flats, stayed negative with 7 up/ 26 down and 2 flats at the mid-day, ending with a negative close of 11 incliners, 23 decliners and 1 flat
  • Wednesday’s advance/decline line opened positive at 32 up/ 2 down and 1 flat, stayed positive with 26 up/ 9 down and 0 flats at the mid-day, ending with a positive close of 26 incliners, 6 decliners and 3 flats
  • Tuesday’s advance/decline line opened negative at 14 up/ 18 down and 3 flats, flipped barely positive with 17 up/ 16 down and 2 flats at the mid-day, ending with a positive close of 19 incliners, 13 decliners and 3 flats
  • Monday’s advance/decline line opened negative at 9 up/ 24 down and 3 flats, flipped negative with 20 up/ 14 down and 1 flat at the mid-day, ending with a positive close of 20 incliners, 13 decliners and 2 flats

 

Ebb and flow:

  • Q3: August – 7 positive and 12 negative closes

 

Key Metrics:

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

  • Friday, the IBB was up +0.57% and the XBI was up +1.12%
  • Thursday, the IBB was down -0.91% and the XBI was down -1.38%
  • Wednesday, the IBB was up +0.58% and the XBI was up +0.63%
  • Tuesday, the IBB was up +0.06% and the XBI was down -0.03%
  • Monday, the IBB was up +1.46% and the XBI was up +1.11%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Friday was down -1.52 point or -8.84% at 15.84
  • Thursday was up +1.11 point or +6.95% at 17.09
  • Wednesday was down -0.99 point or -5.83% at 15.98
  • Tuesday was down -0.14 point or -0.82% at 16.99
  • Monday was down -0.22 point or -1.27% at 17.08

 

Closing Down (12 of 12):

  • Generation Bio (GBIO -$0.21),
  • Verve Therapeutics (VERV -$0.31 after Thursday -$0.98 after Wednesday +$0.40 after Tuesday’s -$0.05 after Monday’s -$0.06),
  • Mesoblast (MESO -$0.14 after Thursday’s +$0.02),
  • Sangamo Therapeutics (SGMO -$0.109),
  • BioLife Solutions (BLFS -$0.08 after Thursday’s -$0.26),
  • Caribou Biosciences (CRBU -$0.05),
  • Compass Therapeutics (CMPX -$0.05),
  • Bellicum Pharmaceuticals (BLCM -$0.045),
  • Editas Medicine (EDIT -$0.04 after Thursday’s +$0.06, Wednesday’s -$0.04, Tuesday’s +$0.17 and Monday’s -$0.04),
  • Homology Medicine (FIXX -$0.03),
  • Agenus (AGEN -$0.02),
  • Adverum Biotechnologies (ADVM -$0.02),

Flat (1):

  • uniQure NV (QURE)

Closing Up (10 of 22):

  • Alnylam Pharmaceuticals (ALNY +$2.49 after Thursday’s -$3.61, Wednesday +$1.00, Tuesday’s +$0.65 and Monday’s +$2.70),
  • Ultragenyx Pharmaceuticals (RARE +$0.94 after Thursday’s +$0.37 after Wednesday’s +$0.52, Tuesday’s -$0.89 and Monday’s +$1.88),
  • Blueprint Medicine (BPMC +$0.92),
  • Intellia Therapeutics (NTLA +$0.73 after Thursday’s -$0.83),
  • Ionis Pharmaceuticals (IONS +$0.51 after Thursday’s +$0.09 after Wednesday’s +$0.40, Tuesday’s +$0.12 and Monday’s -$0.35),
  • Regenxbio (RGNX +$0.25),
  • bluebird bio (BLUE +$0.23 after Thursday’s +$0.09),
  • Precigen (PGEN +$0.20),
  • Harvard Apparatus RM (HRGN +$0.17)
  • Sage Therapeutics (SAGE +$0.16 after Thursday’s +$0.02)

 

Q3/23 – August

  • Friday closed positive with 22 incliners, 12 decliners and 1 flat
  • Thursday closed negative with 11 incliners, 23 decliners and 1 flat
  • Wednesday closed positive with 26 incliners, 6 decliners and 3 flats
  • Tuesday closed positive with 19 incliners, 13 decliners and 3 flats
  • Monday closed positive with 20 incliners, 13 decliners and 2 flats

 

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.”

Surprising, markets “shook-off” the rate hike fear; given that Powell gave no clear indication of which way he sees interest rates heading,

The cell and gene therapy sector turned slightly higher in volatile afternoon trading Friday as markets reacted to a hawkish inflation outlook

Of the three economic segments Fed Chair Powell identified in his speech, core goods and housing services that have fallen recently but the large non-housing services sector needs to show "further progress," he said. Yields, which had fallen on indications of economic slowdown after Wednesday's manufacturing data, reversed. The benchmark 10-year Treasury note rose 1 basis point to 4.24%.

It has seen a cruel summer for Nasdaq index, which is on pace for its worst Augusts since 2015 and 2001 … markets will be on pins and needles regarding what the Fed will do all through September and into October.

 

Cell and gene therapy sector equity dived Friday again after Thursday’s negative close post Wednesday positive close, Tuesday positive close after Monday’s pop following last week’s “pooping the bed” and most of the month of August while upbeat economic data kept alive fears of interest rates remaining higher for longer.

 

August tends to frighten many stock market investors and historians.

•              The stock market is riding high after a strong performance in July, but August could be a difficult month for investors.

•              Data compiled by the Stock Trader’s Almanac shows the S&P 500 averages just a 0.1% gain in August. That makes it the third-worst month on average for the benchmark index. The Dow, meanwhile, averages a loss of 0.04% in August. <CNBC>

 

What’s Cathy Woods, Ark Invest buying and up to in healthcare and biotech <Thursday>?

ARKK invested in the following healthcare and biotech companies: Ginkgo Bioworks (DNA), Accolade (ACCD), Recursion Pharmaceuticals (RXRX), Crispr Therapeutics (CRSP), Adaptive Biotechnologies (ADPT) and Intellia Therapeutics (NTL). <Motley Fool>

 

It hasn’t been a good month to report earnings…

Cell and gene therapy sector performance continues to suggest the results of earning season.

30 of 35 companies have reported so far in August. The average post-report reaction to these stocks has been 100% LPS (loss-per-share) consensus with many also missing revenue forecasts.

Q2/23 net losses earnings, cash positions and runway outcomes. LPS (loss-per-share) releases will present challenges to share pricing with outcomes included … https://www.regmedinvestors.com/articles/13058

 

Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and truth is its product; I can always be WRONG but, I am mostly EARLY!”

 

The top three (3) performing in the session:

Friday: Alnylam Pharmaceuticals (ALNY), Ultragenyx Pharmaceuticals (RARE) – again and Blueprint Medicine (BPMC)

Thursday: Ultragenyx Pharmaceuticals (RARE), Editas Medicine (EDIT) and Ionis Pharmaceuticals (IONS)

Wednesday: CRISPR Therapeutics (CRSP) - again, Alnylam Pharmaceuticals (ALNY) – again and Blueprint Medicine (BPMC)

Tuesday: CRISPR Therapeutics (CRSP), Alnylam Pharmaceuticals (ALNY) and Ultragenyx Pharmaceuticals (RARE)

Monday: Alnylam Pharmaceuticals (ALNY), Ultragenyx Pharmaceuticals (RARE) and Blueprint Medicine (BPMC)

 

While The worst three (3) in the session:

Friday: Verve Therapeutics (VERV) – again, Generation Bio (GBIO) and Mesoblast (MESO)

Thursday: Alnylam Pharmaceuticals (ALNY), Verve Therapeutics (VERV) and Vericel (VCEL)

Wednesday: uniQure NV (QURE), Agenus (AGEN) and Editas Medicine (EDIT) 

Tuesday: Blueprint Medicine (BPMC), Ultragenyx Pharmaceuticals (RARE) and Beam Therapeutics (BEAM)

Monday: Vericel (VCEL), Sage Therapeutics (SAGE), Alnylam Pharmaceuticals (ALNY) – again, Graphite Bio (GPPH)  

 

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 …

 

Harvard Apparatus Regenerative Technology (HRGN) formerly Biostage (OTCQB: BSTG) … as of 7/20/23 -- so many issues according to the 8-K and 10-K!

•              Accumulated deficit:  $88.5 M (newest 10-K)

Question: How many CEOs, presidents, VPs, CFOs, CMOs, board members and audit members have … left or been laid-off, accounting firm’s resignations and employees have resigned since 11/1/13 when it spun out of Harvard Biosciences (HBIO) – guess? Also, how many consultants and CROs were left UNPAID after months of getting IND filed?

 

Going Concern

·         HRGN has incurred substantial operating losses since its inception, and as of June 30, 2023 had an accumulated deficit of approximately $88.5 million and will require additional financing to fund future operations.

·         The Company expects that its operating cash and short-term investments on-hand as of June 30, 2023 of approximately $4.7 million will enable it to fund its operating expenses and capital expenditure requirements into the Q1/2024.

·         Therefore, these conditions present risks about the Company’s ability to continue as a going concern.

·         WHO would INVEST??

·         HRGN will NEED to raise additional funds to fund its operations.

·         In the event the Company is unable to raise additional capital from outside sources before or during the Q1/2024, it may be forced to curtail or cease its operations.

Will HRGN ESCAPE the scandals when its “former” corporate name <Biostage BSTG)> was used by a former chairman and CEO Green initiating scandal plagued utilization of an Italian surgeon and the $5.9 M it took to settle out the executive responsibility as it was SHIFTED to the company shareholders and Harvard Bio (HBIO)???

•              On April 28, 2022, the Company entered into a Preferred Issuance Agreement, or PIA, with Harvard Bioscience (HBIO) dated as of April 27, 2022. Pursuant to the PIA, the Company and HBIO agreed that once HBIO had paid at least $4 million in certain settlement and related legal expenses, to satisfy the Company’s indemnification obligations with respect thereto, in lieu of paying cash, the Company would issue senior convertible preferred stock to HBIO that will contain terms as described in the PIA. <10-K>

•              On June 10, 2022, following the execution of a subscription agreement and HBIO providing evidence of payment of the requisite $4.0 million amount, the Company issued HBIO 4,000 shares of Series E Convertible Preferred Stock, or Series E Preferred Stock, at a price of $1,000 per share to satisfy the Company’s related indemnification obligations pertaining to the $4.0 million, in lieu of paying cash. <10-K>

•              Can this management team be TRUSTED by ANY shareholder other then major holders’ Chinese off-shore investors.

•              HRGN schedules earnings LPS (loss-per-share) – al but broke as 3–5-year clinical trial begins – four (4) years after IND approved

WHO and WHAT is PUMPING and PROMOTING the HRGN stock – has it begun again – 12, 504 shares traded <3 month average = 1,146 shares – out of nowhere or …??

 

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.