December 20, 2023 9:37am

BLUE priced at $1.50 per share of a diminished offering of 83,333,333 shares 30-day option to purchase up to an additional 12,499,999 shares of its common stock at a before deducting underwriting discounts and commissions.

The gross proceeds from the public offering are expected be $125 million, before deducting underwriting discounts and commissions and offering expenses payable by bluebird

Wednesday opened down -$1.09 or -44.65% to $1.34, after Tuesday's -$0.62 or -20.33% to $2.43 after Monday's-$0.22 (-6.73%) to $3.50 with a -$0.43 (-14.10%) aftermarket indication

As I had stated ... " more bitter than sweet" !

 

 

 

With Goldman Sachs & Co. and J.P. Morgan Securities acting as joint book running managers for the offering and Raymond James acting as co-manager for the offering.

 

The Bottom Line: A whole lot of shares and desperate move; investors close your wallet!

The FDA approved BLUE’s sickle cell disease (SCD) gene therapy last week …

On 12/8, the day of the approval, its shares crashed by 40%; from market close 12/7 to market close 12/14, the stock dropped roughly 30%. Friday, 12/15 dropped -$0.03.

The first issue is that a pair of BLUE's direct competitors, CRISPR Therapeutics (CRSP) and Vertex Pharmaceuticals (VRTX), saw their jointly developed gene therapy for SCD, called Casgevy, approved at the same time.

That means BLUE's product, which is called Lyfgenia, will be forced to fight for market share from the get-go.

Lyfgenia is priced at $3.1 million per dose, and it's curative or near-curative. But CRISPR's product costs $2.2 million per dose, and it's also largely curative. <Motley Fool>

  • Then there's the black box warning that regulators mandated for Lyfgenia. Black box warnings denote serious safety risks for patients taking the medicine.
  • In Lyfgenia's case, regulators were concerned about the risk of patients developing hematological malignancies (blood cancers) like acute myeloid leukemia (AML) as a result of treatment.
  • While BLUE conducted a study in 2022 showing that the two cases of its gene therapy patients developing AML were unrelated to their participation in Lyfgenia's clinical trials, the FDA does not appear to be convinced.
  • Now, BLUE will need to check in with patients twice per year for at least the next 15 years to screen them for blood cancers. That'll be expensive. <Motley Fool>