Replies to post #39344 on Biotech Values

[rfj1862]

My 15-minute take on your list. Left out a few that are too obvious (like VLTS).

I wouldn't buy any of them, but if I had to, I'd buy NBIX or AVNR.

COR
Someone else can comment on this one. I’ll keep my mouth shut.

CORT
Absolutely hopeless. RU486 has no effect on psychotic depression, and the company doesn’t have anything in the pipeline.

DOVP
I don’t know much about DOVP, and their website is confusing as hell. No idea here if the pain drug is promising or not.

ICGN
No hope here either since hydroxyurea failed. Although they have several drugs and leads in preclinical development, it’s going to be a long, long time before this moves.

INHX
DOA, since Veronate, their drug for prevention of staph infections in very-low-birth weight infants, is a mechanistic failure. Can’t believe this one every made it past the concept stage.

NBIX
The dust might have settled sufficiently to pick this one up. As of third quarter they had 404 million, or about 4 years at the current burn. They have a bunch of stuff in the pipeline (GnRH antagonist, urocortin for CHF, and an SNRI for neuropathic pain).

NEOL
Dead. Their glioblastoma drug is a complete failure, and the next best thing they have—“me too” liposome entrapped paclitaxel-- is just entering phase II.

NTMD
Don’t know enough about BiDil to have an opinion.

OCCX
Isn’t this the rheopheresis company that Cramer pumped? This will never go anywhere—in order to make any money, any treatment based on apheresis has to show outstanding efficacy given the cost and time involved in the treatments. This won’t.

RNVS
Dead. But they’ve got lots of cash. Maybe POTP should “merge” with them.

THLD
Gone. Does anyone really think glufosfamide is going to show efficacy in pancreatic cancer?

[DewDiligence]

Best/Worst 2007 Biotech Turnarounds—Survey Recap

Although 2007 has five weeks remaining, I’m taking the liberty of ending last year’s survey on turnaround stocks (survey #81) so that a new survey for 2008 can be started.

Last year’s survey asked for the best and worst biotech turnaround stocks — i.e. the survey was limited to stocks that got hammered during 2006. The list of answer choices (in alphabetical order) was: AVNR COR CORT DOVP GENR ICGN INHX NBIX NEOL NTMD OCCX PRW RNVS THLD VLTS VSGN.

As it turned out, the 2007-to-date performance of voters’ top picks for the best turnaround stock was worse than the 2007-to-date performance of voters’ top picks for the worst turnaround stock, although the performance of both groups of stocks was abysmal.

The top-3 vote-getters for the best 2007 turnaround stock were COR, NBIX, and VSGN in that order. COR and VSGN are down more than 50% in 2007 to date. (All three of these stocks are down more than 75% since the start of 2006.)

The top-3 vote-getters for the worst 2007 turnaround stock were GENR, DOVP, and NTMD in that order. DOVP and NTMD fell sharply for the second straight year while GENR eked out a 2% gain. (DOVP is down a shocking 99% since the start of 2006.)

Here are the tallies for the top-3 vote-getters in each group:

Q1: Which is the best turnaround play
for price appreciation in 2007?

 
       Pcnt Who  Pcnt Change  Pcnt Change 
      Voted For  From 1/1/07  From 1/1/06 
 COR     44%        -58%         -78% 
 NBIX    21%         -3%         -84% 
 VSGN     9%        -54%         -92%

Q2: Which is the worst turnaround play
for price appreciation in 2007?

 
       Pcnt Who  Pcnt Change  Pcnt Change 
      Voted For  From 1/1/07  From 1/1/06 
 GENR    28%         +2%         -74% 
 DOVP    19%        -30%         -99% 
 NTMD    12%        -56%         -88%

Moral: Picking turnaround stocks within the relatively short time period of one year is hard.