BioSci Rounds Report For Feb. 16, 2018

We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful. – The Oracle of Omaha (Warren Buffett)

Trading Analytics

On Feb. 16, 2018, the shares of Adamis Pharmaceuticals (NASDAQ:ADMP), a specialty bioscience to service the allergy and respiratory disease market, rallied 9.40% (as the stock traded $0.28 up at $3.20). The aforesaid trading came in as a surprise, as the stock has been on a downtrend since it reached the 52-week high of $6.45. In an excellent Seeking Alpha research, author John Engle alluded that the main concern is that the company has not been able to secure a marketing partner for Sympjepi – a single dose injection of epinephrine as the supportive treatment of the life-threatening allergic reaction coined anaphylaxis in patients at least 66 pounds. Interestingly, Sympjepi is more affordable than the EpiPen (injectable epinephrine) of Mylan (NASDAQ:MYL). Despite that the launch can be successful, it is highly difficult for a small bioscience firm to successful commercialized an approved product. That aside, Adamis also has other molecules in the pipeline that can potentially deliver value.

Figure 1: Notable market movers. (Source: Google Finance).

Market Outlook

Regarding the broader bioscience market, the iShares of NASDAQ Biotechnology Index (NASDAQ:IBB) traded down $0.30 at $110.36 (for -0.36% loss). Moreover, the SPDR S&P Biotech (NYSE:XBI) exchanged hands $0.39 lower at $92.47 (for -0.31% loss). While we do not try to time the market, it seems that bioscience investors felt a bit apprehensive during Fridays trading. Perhaps, the weak sentiment stems from the fact that the current bull market is the second longest in history since the Stock Market Crash in 1929 (a period subsequent to the Great Depression). It is uncertain how the market will react going forward. In one scenario, we could be facing a bear market later this year. In another more likely scenario, the bull market can extend another year or five to beat the previous record.

So what should you do as an investor? In the portfolio allocation article, we recommended our subscribers to take some profits from the robust winners in the IBI Long-Term Portfolio. The proceeds will be used to keep roughly 40% cash in anticipation of the next recession (which in our views is a great time to strategically deploy capital). During the recession, stellar companies will be on sale at a deep bargain to their intrinsic value.

Figure 3: Various bull markets. (Source: FINRA).

Bioscience Catalysts

Lung cancer is the leading cause of death in the US (having the annual mortality of 155,870 as well as the incidence of 222,500 cases). As follows, non-small cell lung cancer (NSCLC) is the most common form. Its great news today that the US FDA approved durvalumab (Imfinzi) of AstraZeneca (NYSE:AZN) for the treatment of Stage 3 NSCL (for patients with tumors that are unresectable and have yet to spread post-chemoradiation). According to the FDA Director Dr. Pazdur,

This is the first treatment approved for stage 3 unresectable NSCLC to reduce the risk of the cancer progressing, when the cancer has not worsened after chemoradiation. For patients with stage 3 lung cancer that cannot be removed surgically, the current approach to prevent progression is chemoradiation. Although a small number of patients may be cured with the chemoradiation, the cancer may eventually progress. Patients now have an approved therapy that has been shown to keep the cancer from progressing for a longer time after chemoradiation.

Interestingly, the share price of AstraZeneca moved slightly south amidst a significant development. In all probability, it seems that the market does not believe that the potential revenues of Imfinzi can make a dent in the $88B market cap firm.

Authors Notes: Were honored that you took the time to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Analyst Vu, and other PhDs), Integrated BioSci Investing (IBI) is delivering stellar returns. To name a few, Nektar, Spectrum, Atara, and Kite procured over 343%, 175%, 224%, and 82% profits, respectively. Our secret sauce is extreme due diligence with expert data analysis. The service features a once-weekly exclusive Alpha-Intelligence article, daily analysis/consulting, and model portfolios. Subscribe to our marketplace now to lock in the legacy price and save money, as we’re increasing our price soon.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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