Investing in biotech stocks - My experience so far

moneyfoolish

BrockStoker said:

@jjdc good to hear. Not sure about the "once in a decade" bit, but if their tech is up to scratch then they should at least be able to keep up with the pack.

What's stealing the show for me today is EVFM. A bit of free publicity from the NY Times, and up 25%+ intraday on big volume. Some serious momentum building there it looks like.

Do you understand what is going on with EVFM, BS? I'm pretty sure I saw somebody talking about it being a reddit stock on the Yahoo forum and people saying the price would be pumped up and then dumped down!

BrockStoker

moneyfoolish said:

BrockStoker said:

@jjdc good to hear. Not sure about the "once in a decade" bit, but if their tech is up to scratch then they should at least be able to keep up with the pack.

What's stealing the show for me today is EVFM. A bit of free publicity from the NY Times, and up 25%+ intraday on big volume. Some serious momentum building there it looks like.

Do you understand what is going on with EVFM, BS? I'm pretty sure I saw somebody talking about it being a reddit stock on the Yahoo forum and people saying the price would be pumped up and then dumped down!

Sounds like noise. Not everyone there is worth listening to - most probably aren't. Inverted thumbs are usually a good guide, but only on message boards like the ARWR board where there are a significant number of experienced investors.

I think all that's going on is investors realizing that EVFM was heavily over sold, and that it could be a very lucrative opportunity. The free publicity has also helped, along with heavy insider buying (and new price targets). It looks like sentiment has done a complete u-turn.

moneyfoolish said:

BrockStoker said:

@moneyfoolish - Yes, a biotech can easily tank with bad trial data. Keep in mind though, ARWR's TRiM platform does not follow the usual rules that conventional small molecule drugs follow. The chances are essentially stacked in ARWR's favor. I'm not saying they can't fail, but once we know it's already working, the chances that it will fall at a later hurdle is near microscopic. Good Amazing times are nearly here!

Hope you have some good Avacta news!

I have to say that the more I read about ARWR, the more positive I feel. Also, I think there are a lot of very knowlegeable stock holders on the Yahoo board who have been investing in this stock for many years and understand the science very well. The fact that they are becoming so confident is encouraging as some of them have been holders and accumulating for 20 years and more. Avacta went up 18% today but that only takes me to a level position! As with ARWR, AWRS and EVFM, I bought at almost the height of the market a few months ago. However, I am now 5% up on ARWR but still 20% down on AMRS

Keep reading. The science is key with ARWR, and that science is truly amazing. In particular, and I know I've said this before, the targeting ligands ARWR use are what sets them apart. Anyone can produce the part of the drug which performs the the gene silencing part of the job, but only ARWR can get it to that particular target tissue EFFECTIVELY, and without all the unwanted side effects associated with the drug ending up in other tissues. That is what sets ARWR apart IMHO, although there are other great qualities besides this that make ARWR what it is - a near perfect company, in an enviable position! They've cracked that nut in multiple tissue types, which puts them effectively light years ahead of the RNAi competition, and light decades ahead of previous medicine in general. The competition are all swimming upstream till they catch up/make that breakthrough, which may take years, by which time ARWR has picked off the juiciest low hanging fruit that RNAi has to offer.

So don't get too hung up on where your portfolio is at now. Let's see how all this new data plays out with Wall Street over the coming weeks/months. ARWR is a long term play after all. It will likely take at least 5-10 years to grow to the stage at which I'm considering taking profits. However, it's always nice to see big price moves, and I do believe you'll like what's coming soon

tom9980

EVFM - while I do see some chat on it being a Reddit squeeze play that's just noise, there is always someone trying to get themselves out of a hole having bought at a much higher price. I bought at $0.86 average so pretty happy right now to wait for the upcoming celebrity endorsement.  The insider buying was fairly small in my opinion but institution investors have bought heavily in recent weeks so I am looking to top slice above $1.50.

Arrowhead looking good right now but I do regret not buying dicerna at $25 where I had set an alert recently. $175+ per share looks possible for arrowhead in the next year if the next few weeks catalysts are positive.

moneyfoolish

tom9980 said:

EVFM - while I do see some chat on it being a Reddit squeeze play that's just noise, there is always someone trying to get themselves out of a hole having bought at a much higher price. I bought at $0.86 average so pretty happy right now to wait for the upcoming celebrity endorsement.  The insider buying was fairly small in my opinion but institution investors have bought heavily in recent weeks so I am looking to top slice above $1.50.

Arrowhead looking good right now but I do regret not buying dicerna at $25 where I had set an alert recently. $175+ per share looks possible for arrowhead in the next year if the next few weeks catalysts are positive.

I also looked at Dicerna, tom9980, but decided there was a large overlap with Arrowhead and was more advanced. Still think Dicerna is a good bet though and if either advance, the other should also.

BrockStoker

Well I think you all know my position on DRNA vs ARWR. I don't see why anyone would opt for DRNA when ARWR has so many advantages at this point in time. As it is the market views DRNA as being ahead at the moment (if valuation is anything to go by), so I'd be weary of investing in DRAN for that reason alone - if the market suddenly starts to favor ARWR over DRNA/ALNY.

On another note, there is growing division over last week's FDA/Biogen altzheimer's drug approval which warrens keeping an eye on:

https://seekingalpha.com/article/4434232-alzheimers-drug-biogen-fda-defied-odds-aduhelm

Also, some good advise for those of us willing to take that little bit extra risk and go for "gold", although I'm sure some might call it controversial:

https://thehustle.co/stanley-druckenmiller-q-and-a-trung-phanin

iwillworkforyou

this is like a sci-fi novel, amazing! hope to invest soon too

BrockStoker

iwillworkforyou said:

this is like a sci-fi novel, amazing! hope to invest soon too

Welcome aboard.

Indeed, we are living in very interesting times. Opportunities abound, but careful not to step on a mine! Hope you can learn from my own and others mistakes. Read all you can, and realize that an investor's worst enemy is usually themselves. Making a mistake can lose you money, so don't rush in and blow your whole budget in one go. People win big by overweighting single companies, buy you should know what you own inside and out before doing this! As always, only invest what you can afford to lose!

That said, enjoy the ride

BrockStoker

As I'm sure all ARWR followers will be aware, a new deal with Horizon Therapeutics to commercialize a treatment for gout was announced earlier today (or yesterday rather since it's now after midnight). Gout is a fairly common inflammatory condition affecting the joints, and caused by excess UA (uric acid) production in the liver, which is where ARWR will target the condition to turn down UA production. "Remove the insult (UA in this case), and cure the condition".

As usual, there is some good commentary on the implications on the Yahoo Finance message board for ARWR, and like most on there, I think this deal is significant for ARWR, although it may not seem such a huge deal at first glance.

Firstly, Horizon Therapeutics is an established big player in the gout treatment market, so we have yet another vote of confidence that has some weight, once again validating the TRiM platform. As with the other deals Arrowhead has made, Horizon would not have entered into it without having done some serious DD.

Secondly, a pattern appears to be emerging, with each partner having been carefully chosen for what it can offer Arrowhead in terms of getting it's therapeutics to the widest possible market in the fastest possible time by using established players in their respective field. I would argue big pharma is effectively being forced into making deals with Arrowhead, or else risk being "vertexed" (a new verb coined by one eloquent YHMB poster).

Lastly, this deal came completely out of the blue - keep in mind those words "it's what we don't know". It's just one of many cherries that will soon adorn the ARWR cake. Remember, the list of potential RNAi treatments for various conditions is pages long, and if ARWR can continue to reel off these indications at an ever increasing pace, although not all indications will be huge (10's of $B PA), multiple many hundreds of millions PA revenue streams (this one could be worth a few $B PA at peak if I'm not mistaken) will soon start to mount up. TRiM is basically a license to print cash. CA mentioned recently he expects Arrowhead to be pulling in $20-50B in sales PA within a few years, and it's easy to see how if you start to combine the potential of the already existing pipeline with "what we don't know"!

Also worthy of note, with the upcoming release of date in trials with humans with cancer, HIF2a, Arrowhead applied for a HIF2a patent last week. That patent covers not just once cancer, but a list of at least 15-20 types of cancer. It's a franchise that could ultimately be worth many tens of $B (if not hundreds) PA in sales, so it's one to watch.

The pop today may have been minimal, but the next week or so should start getting really interesting with the multiple data releases due on top of what we have already. Will it be the moment when Wall Street realizes how much potential for growth ARWR is sitting on? I don't know, but it could be, or we might have to wait a bit longer for the really big moves in SP. At this point I think worst case is we see $120-130 SP before end of this year, and upside is hard to judge if the market gets it and really starts to like what they are seeing! I hate making predictions, as the market is often irrational, but at some point the penny will have to drop, and the flood gates will open. That is my humble opinion.

Good luck to all ARWR holders, and biotech investors in general!

moneyfoolish

BrockStoker said:

As I'm sure all ARWR followers will be aware, a new deal with Horizon Therapeutics to commercialize a treatment for gout was announced earlier today (or yesterday rather since it's now after midnight). Gout is a fairly common inflammatory condition affecting the joints, and caused by excess UA (uric acid) production in the liver, which is where ARWR will target the condition to turn down UA production. "Remove the insult (UA in this case), and cure the condition".

As usual, there is some good commentary on the implications on the Yahoo Finance message board for ARWR, and like most on there, I think this deal is significant for ARWR, although it may not seem such a huge deal at first glance.

Firstly, Horizon Therapeutics is an established big player in the gout treatment market, so we have yet another vote of confidence that has some weight, once again validating the TRiM platform. As with the other deals Arrowhead has made, Horizon would not have entered into it without having done some serious DD.

Secondly, a pattern appears to be emerging, with each partner having been carefully chosen for what it can offer Arrowhead in terms of getting it's therapeutics to the widest possible market in the fastest possible time by using established players in their respective field. I would argue big pharma is effectively being forced into making deals with Arrowhead, or else risk being "vertexed" (a new verb coined by one eloquent YHMB poster).

Lastly, this deal came completely out of the blue - keep in mind those words "it's what we don't know". It's just one of many cherries that will soon adorn the ARWR cake. Remember, the list of potential RNAi treatments for various conditions is pages long, and if ARWR can continue to reel off these indications at an ever increasing pace, although not all indications will be huge (10's of $B PA), multiple many hundreds of millions PA revenue streams (this one could be worth a few $B PA at peak if I'm not mistaken) will soon start to mount up. TRiM is basically a license to print cash. CA mentioned recently he expects Arrowhead to be pulling in $20-50B in sales PA within a few years, and it's easy to see how if you start to combine the potential of the already existing pipeline with "what we don't know"!

Also worthy of note, with the upcoming release of date in trials with humans with cancer, HIF2a, Arrowhead applied for a HIF2a patent last week. That patent covers not just once cancer, but a list of at least 15-20 types of cancer. It's a franchise that could ultimately be worth many tens of $B (if not hundreds) PA in sales, so it's one to watch.

The pop today may have been minimal, but the next week or so should start getting really interesting with the multiple data releases due on top of what we have already. Will it be the moment when Wall Street realizes how much potential for growth ARWR is sitting on? I don't know, but it could be, or we might have to wait a bit longer for the really big moves in SP. At this point I think worst case is we see $120-130 SP before end of this year, and upside is hard to judge if the market gets it and really starts to like what they are seeing! I hate making predictions, as the market is often irrational, but at some point the penny will have to drop, and the flood gates will open. That is my humble opinion.

Good luck to all ARWR holders, and biotech investors in general!

Yes, BS. Lots of potentially promising news from ARWR in June and July according to YF watchers although they are all surprised at the fall today (over 2% as I write). I'd be very happy with your worst case $130 SP but even that would go nowhere near my losses in AMRS and Avacta which has had a huge drop over the last few days because the supposedly large LFT sales have not appeared! Every time AMRS struggles over the $16 mark it fails to hold and drops back.

BrockStoker

@moneyfoolish Just short term noise today. The market remains irrational/oblivious to ARWRs potential, and till that changes, we are "just another risky biotech stock". The institutions know what's up, and it's in their interest to keep the price down so they can accumulate, but as someone said on the YHMB, they can only get their way for so long. Once people start to pile in the game is up, but we need those data readouts to be jaw droppers, which I think they will. Ultimately ARWR should make up for any other stocks that fail to perform, if you hold on long enough, but I think the same is true of AMRS - just temper your expectations for quick recovery/gains. AMRS may well recover soon, but could just as easily trade sideways for some months.

Another example of market shenanigans is the two PRs Sorrento got today, and only up a bit under 3%:

https://finance.yahoo.com/news/sorrento-announces-phase-2-abivertinib-130000932.html

https://finance.yahoo.com/news/sorrento-enters-multi-cooperative-research-174600742.html

Again, not getting what it deserves - I'm down over 30% with it, but I'm confident it will come good eventually.