Just my personal opinion but that may not be a bad strategy, because in some cases, especially with smaller companies, the execution risk after approval is as great (or greater) as getting the drug thru the FDA in the first place (financing, marketing, sales, meeting sales projections, competition, Dr. training, etc.). It's a whole different dynamic after approval and some companies are better than others at it. The reason I am more confident about VSTM than other small companies getting their first drug approved is that executive leadership has a lot of experience with large pharma - Genzym, Lilly, Novartis, Schering, and others. So they have been through process of not only getting a drug approved but getting it in the market.
But to your point, I can think of a couple situations where that was the case. I came across VCEL after approval for MACI and saw the stock wasn't doing anything even though they had just been approved for it. It sounded like a great procedure with no competition and there were several months after approval where the stock didn't do anything. I bought in around $3.50 to $4.00 and rode it up to just past $12 and sold. Got back in around $10 here. Management is rock solid, conservative in their guidance (they just raised revenue guidance this week by about 10%), and they are well funded. The other one is SRNE which is a little more problematic. The got their lidocaine patch approved back in Feb but their stock is 50% of where it was then because of delays getting it to market, etc. They have a pretty good pipeline though and are supposed to start getting their patch to market in Q4. They are in CAR-T and I think has a pretty good future, but they have stumbled out of the gate here on their approved product.
My plan for VSTM is if it runs up to $12 or so prior to FDA decision, I will sell half and keep half through the decision. If it stays below that, I will just wait it out and hold all through decision as it looks like very favorable at this point - data was excellent, they continue hiring (57 new employees with stock inducements yesterday), and they have funding in place. Would love to see a few more days like today! GL.
