Author Archives: Jane

Biotechnology Stock Price Drivers

The following may be happening that can affect the stock price:

  • Presentations or buzz occurring at key scientific and medical meetings; for oncology from which many biotechs sprout, we have ASCO, ASH, AACR, to name a few key meetings.
  • Clinical trial results are closely pending or just released. Typically companies dealing with the same or similar technology/pathway are affected by a peer company’s clinical trial results.
  • FDA decisions pending or released.
  • FDA holds on a clinical trial either imposed or lifted (as with $GERN).
  • Management taking the “poison pill” strategy against possible hostile bids (as with $ARIA 2 years ago)
  • Earnings are reported (usually at a loss unless there is already a commercial drug).
  • Merger & acquisition activity (Drama around $VRX hostile bid for $AGN).
  • Licensing announced including upfront/milestone payments.
  • Orphan drug designation announced (as with $ISIS recently).
  • Key management (C-level for biotech) changes.
  • Major insider buys/sells (like when $INO’s CEO bought a ton of company stock as a show of confidence when stock dropped last year because a blogger made unfavorable comments about the company’s drug, or $OPK’s founder buying a ton of his company’s stock last year when $IBB went through a bloodbath.)
  • Major shareholder (usually investment firms or hedge fund managers) buys/sells.

For the most part, biotech stocks should be viewed either as a speculative investment and/or truly for the long term. Those who bought $MDVN or $PCYC when these were in double digit prices and held through 2015 has seen their investment double or triple in value. There are those who daytrade and really speculate the sector for its volatility, but that’s a pretty stressful “day job” in my personal opinion.

Antibiotic Resistance: Cultural Issue not Medical Science

We must tackle a cultural problem around overuse of antibiotics.

It doesn’t matter whether we keep coming up with antibiotics: we simply breed for the most drug resistant pathogens by increasing the selective pressure in bacteria. We do this by over-prescribing antibiotics.

But wait. This isn’t necessarily about getting doctors to stop over-prescribing antibiotics. If it were that simple….

When a patient comes in complaining of what a physician judge to be “a cold”, the physician may very well tell the patient, “Go home, sip lots of hot tea and chicken soup, get plenty of rest, and take some decongestant for the symptoms.”

Then that patient says, “But I waited in your damn office for 45 minutes! You’d better get me SOMETHING.”

In other words, the patient EXPECTS the doctor to write a prescription for what the patient perceives to be “more than just” a cold.

If that doctor tries to educate the patient on the broader consequences of antibiotic overuse, the patient may very well continue to demand (DEMAND!) that the doctor write a prescription for an antibiotic (yes, here in the U.S. many patients aren’t afraid to tell doctor what they want prescriptions for). If that doctor refuses, the patient simply goes to another doctor, who is willing to write the prescription.

So I don’t care if we come up with nth generation macrolide / cephalosporin or we engineer a quinolone that won’t cause such serious adverse events that half of the drugs in that class has been pulled off the shelf…

I don’t care if we start ‘designing’ antibiotics that overcome a microbe’s awesome drug-effluxing receptors…

it is only a matter of time that we create enough selective pressure for a bug to breed and mutate into a superbug that not only will clip whatever enzyme an antibiotic uses to disable the superbug’s replication system but will pump and dump that antibiotic faster than you can say “vancomycin”.

The most important thing we can do is to curb society’s demand for antibiotics for conditions that does not warrant antibiotics, and hope that pharmaceutical sciences can catch up with the superbugs.

GSK Trading Sluggish on Avandia Saga

2013-06-10 11.31 AM105 Around ASCO time GSK was a promising stock being touted by life science investors as one of those undervalued stock that you can go both long and short. Even with the Avandia scandal going on, you’d think that GSK is almost invincible.

Except it isn’t.

Headlines around Avandia still dominates investor consciousness and even though GSK is more than Avandia, this goes to show that a little bit of bad news that lingers on too long can hurt investor confidence and such ambivalence has been playing out in GSK stock price these past couple of weeks.

$GSK needs to get close to $52.50 and break past this to regain investor confidence. The stock price seems tentative about it, teasing that $52 threshold.

The Bigger the Marketing Machine The Smaller the Cause Relevance

I saw this post from my friend Casey Quinlan about the Susan G. Komen foundation canceling various events across the U.S. due to public backlash of what the public perceives as the foundation’s foray into political stances:

2013-06-06 11.10 AM104

I don’t know what’s happened with Komen but the corporate good will seems to have declined the bigger it’s gotten. Maybe Susan G. Komen foundation needed to stay more a corpus supporting grass roots level chapters as opposed to this major corporation painting everything pink.

What was ironic was that the pink ribbon concept was created by the late Ms. Lauder of Breast Cancer Research Foundation. I did not know that BCRF was the originator of the pink ribbon concept! I thought it came from Komen because this organization pops up *everywhere* I see breast cancer. What a pity that BCRF isn’t getting more recognition and activity about its work — but this also speaks to the formation of public consciousness: the better marketing machines gets the credit even when they may not have come up with the innovation.

Large “cause-based” organizations that consume 80%+ funds for overhead will run into this type of PR problem. Instead of funding research, education, outreach, even scholarships (think: children whose parents have passed due to cancer) — the infrastructure gobbles up the raised funds. This is also what causes frustration and resentment in consumers.