Investing in biotech stocks - My experience so far

BrockStoker

Fourth patient discharged from hospital after Sorrento's COVI-MSC infusions. That's 4/4 who were in a very bad way.

https://finance.yahoo.com/news/01-26-21-covi-msc-222800004.html

Looking forward to seeing the markets reaction to this bit of new

Voyager2002

BrockStoker said:

Fourth patient discharged from hospital after Sorrento's COVI-MSC infusions. That's 4/4 who were in a very bad way.

https://finance.yahoo.com/news/01-26-21-covi-msc-222800004.html

Looking forward to seeing the markets reaction to this bit of new

Last price 15:36:55 - 01/02/2021 

14.66$

+15.80%(+2.00$)

BrockStoker

Voyager2002 said:

BrockStoker said:

Fourth patient discharged from hospital after Sorrento's COVI-MSC infusions. That's 4/4 who were in a very bad way.

https://finance.yahoo.com/news/01-26-21-covi-msc-222800004.html

Looking forward to seeing the markets reaction to this bit of new

Last price 15:36:55 - 01/02/2021 

14.66$

+15.80%(+2.00$)

Good volume as well.

Should be more catalysts/news coming up too - they have quite a few pokers in the fire!

Of course, it's stocks that I sold previously that are REALLY flying today:

https://finance.yahoo.com/quote/BCRX?p=BCRX

Gritstone too:

https://finance.yahoo.com/quote/GRTS?p=GRTS

Can't grumble though, EVFM and ARWR both up - everything looks green today! (edit - apart from AMRS)

ultrasilvam

@BrockStoker any thoughts about Tissue Regenix Group (TRX)? are you familiar with them by any chance? 

BrockStoker

ultrasilvam said:

@BrockStoker any thoughts about Tissue Regenix Group (TRX)? are you familiar with them by any chance? 

It's one I've had in my watch list since someone mentioned it earlier in this thread. It's not one I'd bet the farm on, but could be a 10-20 bagger, or you might loose all/most of your initial investment. Only done some very basic DD, but it doesn't look very expensive (though could be better) and volume has been building in a way that suggests it could break out soon.

One thing that does stand out is the very large float (4+Bn) - which I don't think is a great thing? Still lot's of insider/institutional ownership of stock which is not a bad thing.

BananaRepublic

BrockStoker said:

Fourth patient discharged from hospital after Sorrento's COVI-MSC infusions. That's 4/4 who were in a very bad way.

https://finance.yahoo.com/news/01-26-21-covi-msc-222800004.html

Looking forward to seeing the markets reaction to this bit of new

This does seem to be a small sample but let’s assume it’s a cure with no side effects. We now have vaccines that by all accounts are 100% effective at preventing serious illness. So isn’t this going to be expensive (I don’t think stem cells are cheap) and largely not needed? Mind you, it might make a very good short term investment. 

BrockStoker

I don't think covid is going away any time soon, although vaccines are getting it under control. The trouble is that covid is "slippery", and eventually there will be a variant which the vaccines won't be able to combat effectively. At least one vaccine is only 60% effective with the SA variant for example. So the threat of outbreaks could be with us for years. Effective therapies will play their role along side vaccines, and in many cases it does not matter if the virus mutates. Indeed, I recently heard that funding/focus is starting to shift away from vaccines and to therapeutics. There still hasn't been a very good therapeutic found, which makes this one very attractive/desirable IMHO, especially if it's as good as these early results suggest.

There's a risk it does not play out like this of course, and there are plenty of competitors, but I think SRNE has hedged it's bets nicely with a variety of promising products in it's pipeline.

https://sorrentotherapeutics.com/research/covid-19/

As you say, it could at least be a good/great short term play, but with their current non-covid pipeline, they at least have a few shots on goal which could justify the current valuations.

I just looked into the cost of the stem cells they use (adipose-derived stem cells (ASCs)) and they are relatively cheap/abundant:

https://www.hindawi.com/journals/sci/2019/5858247/

It may be that SRNE gets Operation Warpspeed funding - wouldn't surprise me if CEO Ji was in talks with NIH. Also it could be approved on the basis of phase 2 trial data if the trial is well enough designed/has enough participants enrolled. I believe Phase 2 starts in March and is complete by December, but would not be surprised if this was hastened.

I'm not sure of the cost per treatment but I hear their covid tests which are supposed to take as little as 15mins while being very accurate cost $112 each which sounds about right to me.

Overall though, I like the fact that it's a fast moving disruptive biotech that has been able to adapt to the new landscape. If these early results are anything to go by, it has the "next gen" advantage over many existing biotechs, which means that drugs/therapeutics are highly targeted/precise so they are likely to work - or at least significantly more likely - than old tech. That's not to say it won't find itself fighting/competing with others like itself, so I'm not sure about holding for the very long term, but for the moment it seems to be in the sweet spot! I wouldn't be surprised to see a series of 10-50% pops over the next few weeks/months. Possibly high double digit/low triple digit share price before the year is out, perhaps more, providing everything goes well.

In this environment it seems almost anything is possible, and if it pops anywhere near triple digits soon, I may sell it all and buy ARWR if that still hasn't popped, but that's the super-optimistic scenario.

BananaRepublic

I believe 60% effective means prevents covid symptoms 60% of the time, but as far as I know all vaccines are 100% effective at preventing hospitalisation and death. Anyway, this is a footnote. Remind me about this when you retire to the Caribbean. 🙂

Voyager2002

Social media are saying that this morning SRNE received a US patent for a fluid delivery apparatus. The only article about this is behind a pay-wall: any idea what it is?

And the share price has pulled back somewhat: is that likely to be profit-taking after yesterday, or has something happened?

BrockStoker

ultrasilvam said:

BrockStoker said:

ultrasilvam said:

@BrockStoker any thoughts about Tissue Regenix Group (TRX)? are you familiar with them by any chance? 

It's one I've had in my watch list since someone mentioned it earlier in this thread. It's not one I'd bet the farm on, but could be a 10-20 bagger, or you might loose all/most of your initial investment. Only done some very basic DD, but it doesn't look very expensive (though could be better) and volume has been building in a way that suggests it could break out soon.

One thing that does stand out is the very large float (4+Bn) - which I don't think is a great thing? Still lot's of insider/institutional ownership of stock which is not a bad thing.

I bought 100000 TRX shares with the view to keep them long term (10+ years or more). Paid a bit less than £600 for these including the dealing fee, so let's see what happens. 10x would be lovely, 20x will make me regret I didn't buy more :-) 

You might not need to hold them for 10+ years, but it's good to be mentally prepared to do so if required. Good luck!