Investing in biotech stocks - My experience so far

coachman12

BrockStoker said:

Coachman,  Hello Brock

Re "Bram": Yes, seems like I have written a few mini-novels recently. It's not unusual if I'm passionate about a particular subject, although more normally I'm much more reserved! 
I like it actually and your fervour is contagious so please keep it going.

AZN - I can understand your advisor thinking there could be dips to come. CV stocks have been made that bit more volatile. But again, more good news so I hear - AZN vaccine trials could re-start very soon. I think even if the vaccine fails, the dip will be transient/short-lived.
The advice from a week or two ago to take a lot of profit did not grab me too much but I did come on to this site to ask advice for the first time on MSE and you backed up my feelings and I am grateful. I agree with you about a vaccine failure ( though not with quite as much conviction)  ---but my adviser does not believe it at all: he thinks it will be pivotal ( he favours Moderna/ Cambridge as far as I can make out)---hence the advice to take a big AZN profit on 1-2000 shares a little while ago. I think AZN/Oxford trials have begun here again, and been proceeding in Japan for a little while.

If you've been reading ARWR YMB then you should have a good idea now why Ionis is not going to be a threat. There have been a few posts on the subject.
If it's got nothing to do with the FDA setbacks of 2018 , which sounded a bit "shady" and also affected Akcea, then I have missed Ionis' failure to show more than its original promise, then I ask you to tell me please as I must have missed it during my YMB intensive reading.

Regarding covid/the lockdown - it has been a bit of a blessing in disguise in many respects for me. It's certainly presented some excellent opportunities, and like yourself, has given me time to delve a bit deeper into things than perhaps I normally would. There have also been challenges for my wife and I, but I think we will come through relatively unscathed, and there are certainly many others out there that have suffered much worse that us due to this situation. I hope you have been coping OK!
I don't like to hear of your "challenges" and hope all is OK. We are coping well, quite snug really---relying on plenty of delivery services. Talking of which, I have mentioned my passion for Ocado previously and though October has not been kind to prices, they have still risen over the past 6 months from 1600GBX to 2400 now.

It sounds like you have the monitoring under control then. I'm a little OCD when it comes to watching my holdings/the market, and like to see every twist, turn, dip, and bit of news, even though I probably don't need to. Certainly with ARWR, I think that is a stock that can easily just be left to do it's thing over the next few years, without the need for constant supervision.

I think if you are planning buying more ARWR stock you might want to move fast. Perhaps I'm wrong, and there will be some dips, but I would not count on it, at least for the moment. It certainly seems to be gaining momentum, and I would not be surprised to see it do something similar to what AXSM did at the end of last year - that was a 3 bagger for me (if I'd sold at the top).
OCD .   It's happening to me with ARWR and I'm not even loaded with a huge shareholding. Was I the last investor in the world to buy at less than $50 ? Today's price is too high for me to buy an extra 500 shares----I'm waiting for a little dip that I hope will come along soon , bucking the general upward trend. If that happens, I will buy anywhere below $52ish. I am ready to pounce !

If you are contemplating other stocks in the sector,
No such thoughts at present Brock, even though I have obviously come across hitherto unknown companies in my biotech research which have tickled my interest.
I still like TXG (picks and shovels for the genetic revolution that is just getting warmed up) and ONEM (slightly more risky I think, but with much potential for growth if they can get it right). I only sold them because I wanted more ARWR, but if I had the extra cash, I would have kept them. I also think EVFM and AMRS (both of which I have significant holdings in) could make serious money, but they are a bit more risky.

Anyway, great to see ARWR making strong moves up. It looks like you got in at just the right time! If I might ask, what does your advisor think about ARWR?
I'm glad you asked because I meant to tell you at the time and forgot. When I told him of my purchase so he could add it to the portfolio and keep an eye on the new addition, I asked his retrospective opinion. He had to go and seek the advice of a specialist biotech colleague as he did not know ARWR well enough . I recollect he had to do the same thing when I purchased CIPLA (my only other biotech besides AZN, Alexion and ARWR)---which I recommend. The ARWR report from specialist was glowing, all the right noises, much knowledge about RNAi, etc----which pleased me and I knew would please you. There were only two questionmark comments: one was about a possibility I raised with you ie. possibility of takeover and I smiled that the MSE expert had already dealt with that aspect ( and I didn't have to pay for your thoughts  ). His only other thought was that Dr Anzelone had not founded ARWR, which he would have made the adviser a bit more sure of commitment and future personal ambitions and whether Dr Anzelone could be tempted away from ARWR. I was impressed that advisors were taking all such aspects into account, but , after your views, the links you provided and my own research, I was content.
                                       ---------------------------------------------
Looks like a poor day on markets so no "single day" jumping for joy at any of my shares, except ARWR----a company I hadn't heard of several weeks ago. Funny old world !
Till soon, Brock. Take care.

BrockStoker

The advice from a week or two ago to take a lot of profit did not grab me too much but I did come on to this site to ask advice for the first time on MSE and you backed up my feelings and I am grateful. I agree with you about a vaccine failure ( though not with quite as much conviction)  ---but my adviser does not believe it at all: he thinks it will be pivotal ( he favours Moderna/ Cambridge as far as I can make out)---hence the advice to take a big AZN profit on 1-2000 shares a little while ago. I think AZN/Oxford trials have begun here again, and been proceeding in Japan for a little while.

I think vaccines are going to be very hit and miss. It's one of the reasons I avoided chasing CV19 stocks, although I stuck with those that I already held who decided to go down the CV19 route. In that respect, I'm in a similar situation to you with a few of my stocks, where bad CV19 news could negatively affect them. I'm much less confident in Moderna's vaccine candidate than I was. There was a rumour that it was not doing so well, but not sure how true.

If it's got nothing to do with the FDA setbacks of 2018 , which sounded a bit "shady" and also affected Akcea, then I have missed Ionis' failure to show more than its original promise, then I ask you to tell me please as I must have missed it during my YMB intensive reading.

This post by BioBoyScout (posted 2 days ago now) is the one I was alluding to:

"Additional observations on the Ionis ENaC news. If you go to the Ionis webpage and look under the tab "Ionis Innovation" and select "Optimizing Antisense", you'll see an explanation of the technology that Ionis uses for its drugs. There are four different technologies: Gen 2+, Gen 2+ LICA, Gen 2.5, and Gen 2.5 LICA. What is LICA? Ionis explains it on that page, it's basically their antisense drugs with targeting ligands (LIgand Conjugated Antisense).

If you recall, Arrowhead in its presentations well over a year ago showed plenty of data on how using targeting ligands with their triggers was much more effective than without using targeting ligands. This is because you're able to target drug into areas where you want it to go. Without a targeting ligand, the drug ends up being much more dispersed throughout the body. The drug may "work" without a targeting ligand, but it will be much less effective because less of the drug gets to where you're wanting it to go (i.e. the liver, or the lung).

With that said, if you go to Ionis's pipeline page, head down to their ENaC drug and click on it, it will expand to show additional information about the drug. This additional info states that the technology used for its ENaC drug is Gen 2.5. It is NOT Gen 2.5 LICA or Gen 2+ LICA, therefore Ionis's ENaC drug is without a targeting ligand. What does this mean? It means that the drug is not specifically targeted like Arrowhead's is to the lung. No doubt Ionis's drug will get absorbed by the lung, but it will also get dispersed elsewhere and will most likely not get the same concentration of to the lung as Arrowhead can.

The benefit of having a ligand-less drug is that it's easier and cheaper to manufacture and test. The downside is that you're probably not getting most of your drug where you want it to be. The result can be a higher risk of side effects and off-target effects.

So given the fact that Ionis was able to effectively knock down and target the ENaC gene with a ligand-less drug, this should bode much better for Arrowhead's targeting ligand conjugated drug, not just in terms of effectiveness, but also in terms of safety."

Basically, the Ionis drug/drugs are never going to be as targeted as ARWR's, due to ligands, making them prone to unwanted side effects.

I don't like to hear of your "challenges" and hope all is OK. We are coping well, quite snug really---relying on plenty of delivery services. Talking of which, I have mentioned my passion for Ocado previously and though October has not been kind to prices, they have still risen over the past 6 months from 1600GBX to 2400 now.

That's not bad going! I'm quite surprised you've done so well out of it considering that it's been making a loss.

OCD .   It's happening to me with ARWR and I'm not even loaded with a huge shareholding. Was I the last investor in the world to buy at less than $50 ? Today's price is too high for me to buy an extra 500 shares----I'm waiting for a little dip that I hope will come along soon , bucking the general upward trend. If that happens, I will buy anywhere below $52ish. I am ready to pounce !

I guess ARWR enthusiasm is highly infectious when the realization of the potential here hits home. Normally not being able to sleep because of investments is because you are worried about them. In my case I have not been able to sleep the last few nights due to being so "revved-up" over ARWR!

Hopefully there will be a dip so you can get some more in. I'm not sure if we will see $52 again though. I thought the same before, and was proved wrong, but ARWR is behaving very differently to how it was just a few weeks back.

I'm glad you asked because I meant to tell you at the time and forgot. When I told him of my purchase so he could add it to the portfolio and keep an eye on the new addition, I asked his retrospective opinion. He had to go and seek the advice of a specialist biotech colleague as he did not know ARWR well enough . I recollect he had to do the same thing when I purchased CIPLA (my only other biotech besides AZN, Alexion and ARWR)---which I recommend. The ARWR report from specialist was glowing, all the right noises, much knowledge about RNAi, etc----which pleased me and I knew would please you. There were only two questionmark comments: one was about a possibility I raised with you ie. possibility of takeover and I smiled that the MSE expert had already dealt with that aspect ( and I didn't have to pay for your thoughts  ). His only other thought was that Dr Anzelone had not founded ARWR, which he would have made the adviser a bit more sure of commitment and future personal ambitions and whether Dr Anzelone could be tempted away from ARWR. I was impressed that advisors were taking all such aspects into account, but , after your views, the links you provided and my own research, I was content.

Interesting to hear - Thanks! It sounds like your biotech specialist is quite well clued up then.

Interestingly ARWR does not consider itself to be a biotech, but just a "tech" company. There's an interesting post on the YMB from someone called "Bug", posted last night, which is worth a read if you have not already. I think it hits the nail on the head - pointing out it's the business model that sets ARWR apart from the rest, although I do think that is only one piece of the puzzle(the rest being very focused management/a great team, with a killer RNAi platform, and of course the fact that RNAi is truly cutting edge).

Looks like a poor day on markets so no "single day" jumping for joy at any of my shares, except ARWR----a company I hadn't heard of several weeks ago. Funny old world !
Till soon, Brock. Take care.

Yes, a lot of red about in the last few days, but my portfolios (the one portfolio holding ORTX as it's single holding being the exception now) are well into the green overall. Nice feeling!

Will be interesting to see what a green market day does

BrockStoker

Here's a little update on my portfolio. Looks like it's starting to hold above 50% total gain now! I've combined both my S&S ISA and SIPP into one single portfolio on Yahoo Finance for monitoring purposes. As mentioned before, a total of £40K of my money was invested, and it's almost a whole year since I first bought. This snapshot is from 20th Oct.

Note:

1. Some of the gains (including the total gain) for some stocks are not correct since I had to sell in one portfolio, and buy back in another. The stocks most affected are ARWR and BCRX, but others may be out by a small amount since I would have had to find all my FX rates for my buys, and it was easier to approximate what the Dollar cost was. The actual values are all correct.

2. Total and Day gains (at the top are in GBP), as are the "Market Value", "Daily Gain" and "Total gain" columns. Everything else is in USD.

3. The annual performance chart is not correct since I did not bother to enter in the dates of individual buys, but grouped multiple buys into a single lot and gave it a buy date corresponding to the first time I bought the stock. In many cases I bought a few lots, trying to buy lower than the original price I paid.

coachman12

Quite an achievement , Brock. It can take some very shrewd buying to make such profits in 5 years, let alone your ONE year. Continuing success. But you'll have to get rid of the Arrowhead shares : they'll only drag you down 

BrockStoker

Thanks Coach. I wish I could take full credit, but the timing when both lots of £20K came through probably played a part - at least the first lot, which came through just as the biotech sector was coming out of a 5 year hibernation. Very lucky there for sure. For the second lot, I got the ball rolling as the CV19 crash was in progress, and it came through just a few days before the bottom. Picking up my first lot of ARWR shares for under $20 was a no-brainer.

Edit to add: On the other hand, I made a few mistakes early on that hampered performance.

1. I bought too many stocks. I should have just gone with a few high conviction stocks.

2. I bought in quite small lots (increasing my fees/costs).

Correcting those mistakes (as far as possible) took a fair chunk out of my profits.

If you think that's impressive, here's my wife's portfolio today, which I began buying exactly 13 days ago today! Only two stocks so far, but there is still dry powder for any opportunities.

adindas

https://www.dailymail.co.uk/news/article-8938065/CEO-sells-stock-worth-5-6-mln-day-Pfizers-COVID-19-vaccine-update.html

Is it an insider trading??

Who could know the product better and earlier than the insiders on how successful their product are ??

This is the potential problem with investing in Bio Tech, Pharmaceutical companies. Pfizer is not a small cap stock but with small cap penny stock the problem is even much bigger..

Insider trading is illegal but the problem is how to prove it and the cost of investigating them.

There is a good educational videos and reseasrch regarding Insider trading. Search this title on youtube.. I deliberately do not put the link as it is not my intention to promote this channel.

"Pfizer CEO Sells Shares After Vaccine Announcement - What Does It Mean?

adindas

BrockStoker said:

Here's a little update on my portfolio. Looks like it's starting to hold above 50% total gain now! I've combined both my S&S ISA and SIPP into one single portfolio on Yahoo Finance for monitoring purposes. As mentioned before, a total of £40K of my money was invested, and it's almost a whole year since I first bought. This snapshot is from 20th Oct.

Note:

1. Some of the gains (including the total gain) for some stocks are not correct since I had to sell in one portfolio, and buy back in another. The stocks most affected are ARWR and BCRX, but others may be out by a small amount since I would have had to find all my FX rates for my buys, and it was easier to approximate what the Dollar cost was. The actual values are all correct.

2. Total and Day gains (at the top are in GBP), as are the "Market Value", "Daily Gain" and "Total gain" columns. Everything else is in USD.

3. The annual performance chart is not correct since I did not bother to enter in the dates of individual buys, but grouped multiple buys into a single lot and gave it a buy date corresponding to the first time I bought the stock. In many cases I bought a few lots, trying to buy lower than the original price I paid.

Well done BrockStoker said. Such an Achievement.

BrockStoker

adindas said:

https://www.dailymail.co.uk/news/article-8938065/CEO-sells-stock-worth-5-6-mln-day-Pfizers-COVID-19-vaccine-update.html

Is it an insider trading??

Who could know the product better and earlier than the insiders on how successful their product are ??

This is the potential problem with investing in Bio Tech, Pharmaceutical companies. Pfizer is not a small cap stock but with small cap penny stock the problem is even much bigger..

Insider trading is illegal but the problem is how to prove it and the cost of investigating them.

There is a good educational videos and reseasrch regarding Insider trading. Search this title on youtube.. I deliberately do not put the link as it is not my intention to promote this channel.

"Pfizer CEO Sells Shares After Vaccine Announcement - What Does It Mean?

Adindas,

As far as I'm aware, insider trading is not illegal, at least if an insider declares the trade and sticks to the rules. I believe the trade must be declared before hand to be "above board".

One reason I like Arrowhead so much is that the CEO usually books sales before data is due (before the share price has gone up), knowing full well that the data will be good.

With other biotechs I have been invested in, I have not found it to be a problem, although it can scare investors, as it did when EVFM's CEO sold some stock to buy her parents a new home - I thought that was perfectly acceptable/reasonable, but the SP still sank.

The way I see it is that there need to be incentives for insiders to perform, and if those incentives are in the form of stock, then they should be allowed to trade (within the rules). At the end of the day sometimes insiders need cash too, and also for purposes of diversification it's not a bad idea.

The other side of the coin is that we also see insiders buying stock, which is bullish anyway, but especially so if they are not using their stock options, but their own cash.

So I'm not sure you can read anything into it, although sometimes it might be a warning sign, but probably not in this case I suspect, although I could be wrong.

ChilliBob

Can you guess who this is? /Me waves to Nitric/Nits.  

Thrugelmir

BrockStoker said:

adindas said:

https://www.dailymail.co.uk/news/article-8938065/CEO-sells-stock-worth-5-6-mln-day-Pfizers-COVID-19-vaccine-update.html

Is it an insider trading??

Who could know the product better and earlier than the insiders on how successful their product are ??

This is the potential problem with investing in Bio Tech, Pharmaceutical companies. Pfizer is not a small cap stock but with small cap penny stock the problem is even much bigger..

Insider trading is illegal but the problem is how to prove it and the cost of investigating them.

There is a good educational videos and reseasrch regarding Insider trading. Search this title on youtube.. I deliberately do not put the link as it is not my intention to promote this channel.

"Pfizer CEO Sells Shares After Vaccine Announcement - What Does It Mean?

 as it did when EVFM's CEO sold some stock to buy her parents a new home - I thought that was perfectly acceptable/reasonable, but the SP still sank.

Institutional investors require confidence in the management. Lose trust you lose respect. What else is the management doing to feather their own nest?