ARROWHEAD PHARMA

I posted recently about my large gains on my many shares in Astra Zeneca. But I talk now about one of my portfolio companies on which I lost money. What happened to Arrowhead ? I bought over 1000 shares a few years ago and watched the volatility normally associated with Biotechs, but nevertheless, there was a point in which my profit was nearly 100%. And then the markets ( regardless of general fluctuations on NASDAQ) seemed to completely lose confidence in the company, which is based in California. I bought at 40 USD a couple of years ago and saw prices as high as 90 about 18 months ago. I have given up on this company and sold this autumn at 33 USD----a small loss but both I and my portfolio manager had put a lot of time and research into Arrowhead and their possibilities for amazing breakthroughs in the RNA field. 

I seem to remember a few posters who were similar adherents of Arrowhead and I wonder if any of them are still around and whether they casn shed any light please on a company I had such high hopes for. TIA
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  • edited 15 December 2022 at 6:56AM
    kinger101kinger101 Forumite
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    edited 15 December 2022 at 6:56AM
    The was a bit of a biotech bubble during COVID.  Particularly for companies doing anything RNA.  I suspect it gently deflated.

    Arrowhead has only pipeline medicines, so their shares are always going to be a punt. On the positive side, it looks like they do have some IP in targeting specific tissues in the body, and that they're partnering with some larger pharmaceutical companies (giving them some credibility among their peers).

    But there shares are going to be more volatile than big pharma stocks.

    Did you do your research?  What is the typical attrition rate during each stage of a clinical trial?  When are their phase 3 trials gue to report?  What is the market size for the conditions they're aiming to treat?  What are their competitors up to?

    PS - I remember the biotech poster.  The phrase singing when you're winning springs to mind.
    "Real knowledge is to know the extent of one's ignorance" - Confucius
  • CusCus Forumite
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    Yes, @BrockStoker was the man on this.
  • sevenhillssevenhills Forumite
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    I bought AMYRS and they gained over 80% so I sold. I have had other shares that did similar, I didn't sell and they went bust. So I tend to take the profit.
    AMYRS are now way down 1.7 will they recover?
  • kinger101kinger101 Forumite
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    I bought AMYRS and they gained over 80% so I sold. I have had other shares that did similar, I didn't sell and they went bust. So I tend to take the profit.
    AMYRS are now way down 1.7 will they recover?
    Technically, I think they're brilliant and employ some some of the brightest minds in synthetic biology.  The issue they have is sometimes they make chemicals using yeast because they can.  Not because there's a huge market for them.    

    DSM, Croda and Chr Hansen (the later two which have been bought out by Cargill the Novazymes) certainly have more commercial awareness.  Maybe someone will buy Amyris for their IP/expertise.     
    "Real knowledge is to know the extent of one's ignorance" - Confucius
  • Richard1212Richard1212 Forumite
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    kinger101 said:
    The was a bit of a biotech bubble during COVID.  Particularly for companies doing anything RNAi.  I suspect it gently deflated.

    Arrowhead has only pipeline medicines, so their shares are always going to be a punt. On the positive side, it looks like they do have some IP in targeting specific tissues in the body, and that they're partnering with some larger pharmaceutical companies (giving them some credibility among their peers).

    But there shares are going to be more volatile than big pharma stocks.

    Did you do your research?  What is the typical attrition rate during each stage of a clinical trial?  When are their phase 3 trials gue to report?  What is the market size for the conditions they're aiming to treat?  What are their competitors up to?

    PS - I remember the biotech poster.  The phrase singing when you're winning springs to mind.
    I couldn't agree more with your PS  :)
    Yep, we did all the research, kept up to date with the CEO's many statements, watched the competition, were impressed by the  range of 15 pipeline trial drugs aimed at various diseases and parts of the body, impressed by multi billion  association deal with Janssen, thought gene silencing was the future cure for everything-----and VERY impressed by their TRiM Platform which was attracting interest from all over the place ( personally I thought there would be a very lucrative takeover by one of the giants in the field for the platform alone).

    BUT in 2021 when Arrowhead paused one of their  pipeline drugs ( for cystic fibrosis, based on bad results with testing on rats),  -----though cystic fibrosis was a minor part of their overall
    priorities------it was as though their whole RNA interference technology was thrown into question and they never really recovered market confidence in spite of pipeline advances in a number of areas , new association deals and more trial drugs. To be fair they have never marketed a drug---after nearly 10 years.

    Biotechs is a real nightmare for investors, IMHO. Yes, you can make a fortune----but since selling most of my Arrowhead shares, I have tended to stick to a few of the major players in that sector, more importantly actual pharmaceutical companies rather than "would be " pharmas ( and even they need some nerve on occasions). It is not one of the sectors in my 9 sector portfolio that I step into lightly----and you probably feel the same way. I feel there are less problematic areas for making big killings  (as in the case of AZ where I have made really lucrative gains in the space of 2 years).
  • kinger101kinger101 Forumite
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    I personally don't invest in individual stocks.  Happy pooling risk via trackers.  I don't have the time for research, and if I did beat the market as a result, I'd put it down to luck rather than skill.
    "Real knowledge is to know the extent of one's ignorance" - Confucius
  • Richard1212Richard1212 Forumite
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    kinger101 said:
    I personally don't invest in individual stocks.  Happy pooling risk via trackers.  I don't have the time for research, and if I did beat the market as a result, I'd put it down to luck rather than skill.
    You make a case , Kinger, for employing a portfolio manager : like you, I don't have time for research except on few occasions when I am deeply interested in the company or subject matter. My manager is invaluable and manages a very large portfolio covering 9 market sectors. I have no doubt that constant research by my manager makes "skill" more significant than " luck" ( though of course there will always be exceptions ).
  • edited 16 December 2022 at 1:45AM
    JohnWinderJohnWinder Forumite
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    edited 16 December 2022 at 1:45AM

    I get the sense that you don’t need my advice with your investing, but you’ve raised an interesting point.

    ‘I have no doubt that constant research by my manager makes "skill" more significant than " luck"’

    Recall that over the last century 96% of USA stocks returned no more than a savings account would have. Only 4% of stocks made the US stock market as good as it was. Two thirds of US stocks gave a negative return over the last few decades. This suggests that ‘luck’, if it means choosing haphazardly or without deliberation, will fail badly as a stock investing approach since you’re more likely to choose a loser each pick. So your advisor’s skill will need to be much MUCH more significant than their luck. It probably is, but is it enough to get you above market returns, taking the same risk? This is why not, according to the cognoscenti (which I’m not)…

    The price of any/all stocks reflects all the knowledge which all stock traders have; everything known about that stock is reflected in the price. We can say that because if any trader(s) knew something suggesting the stock was more (or less) valuable that no one else knew, they would buy (or sell) thus moving the price until it reflected their knowledge of its value. So, to claim you can trade stocks to get better than market returns is to say you have more knowledge of those stocks than all or nearly all traders in the market!  Someone on the planet has to be the best I suppose, but why should it be your advisor (or why not, I suppose)? It’s a ‘big ask’. The challenge for your advisor, doing all his research, is that he’s up against not just me or you with limited knowledge whom he’d make a killing out of, but up against the best professional investors and fund managers on the planet with all their resources. Is he better than all or almost all of them? That would take luck on your part, or he needs luck to make up for any gap between his knowledge and the total of everyone else’s.

    You hitch your wagon to luck more than you need to in chasing market returns which we can get with a broad cap weighted index fund; or are you after more than that, in which case consider leveraged market buying.

  • JohnWinderJohnWinder Forumite
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    My manager is invaluable and manages a very large portfolio covering 9 market sectors. 
    To which we might add: he’s now up against other professionals who each focus on just one of those nine market sectors. An even ‘bigger ask’.
  • mattywallace121mattywallace121 Forumite
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    Hires portfolio manager who completes large amounts of research, yet comes on a public forum asking for advice...............?
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