January 14, 2025 7:51am

As I wrote, “Bad news is unhealthy news, good news seems limited, and no news is usually bad news”

JP Morgan Healthcare Conference continues this week

News: REGENXBIO (RGNX +$0.64 or +8.63% to $6.95) and Nippon Shinyaku Co., Ltd. announced a strategic partnership for the development and commercialization of RGX-121 for the treatment of Mucopolysaccharidosis II (MPS II), also known as Hunter syndrome, and RGX-111 for Mucopolysaccharidosis I (MPS I), also known as Hurler syndrome. Under the terms of the agreement, RGNX will receive $110 M at closing and up to an additional $700 M if certain milestones are achieved, consisting of $40 M in potential development and regulatory milestones and $660 M in potential sales milestones. RGNX will also receive meaningful double-digit royalties on net sales in the U.S. and Asia

 

Breaking: The producer price index (PPI) rose 0.2% in December, less than the 0.4% increase in November and below the consensus estimate for 0.4%. Excluding food and energy, so-called core PPI was flat compared to the forecast for a 0.3% rise. Excluding food, energy and trade services, the measure rose just 0.1%. <Bureau of Labor Statistics>

Pre-open Indications: A few (8) on the slippery slope unless “uncle algo and his electron his trading dwarfs” come to visit

Never leave an investor uninform

Remember that overnight and pre-open actions’ futures and markets doesn’t necessarily translate into actual trading in today’s market session.

My interpretation of the morning’s numbers is written to be informative; it’s built on what happened to make “it” happen today!

 

Monday’s night’s … RegMed Investors (RMi) Closing Bell: JPMorgan Healthcare conference kicks-off … https://www.regmedinvestors.com/articles/13765

Sage Therapeutics (SAGE) Confirms Receipt of Unsolicited Non-binding Acquisition Proposal from Biogen (BIIB) … https://www.regmedinvestors.com/articles/13763

 

Monday: the pre-open Dow futures are UP +0.08% or (+34 points), the S&P futures are UP +0.58% or (+34 points) and the Nasdaq futures are UP +0.88% or (+183 points)

  • Stock futures are positive and fludtuating after PPI release on Tuesday, 1/14/25
  • European markets traded higher
  • Asia-Pacific markets mostly rose

 

Henry’omics: We need to more than consider the economic environment to comprehend the micro re “our” universe of cell and gene therapy companies

Monday: The Dow closed UP +358.67 points or +0.86%, the S&P closed UP +9.18 points or +0.16% while the Nasdaq closed DOWN -73.53 points or -0.38%

Today’s Tuesday action comes after the Nasdaq slid for the 4th consecutive day in the regular session.

Economic Data Docket: December’s producer price index report

  • Economists predict that headline PPI grew 0.4%, while the core figure, which excludes food and energy, rose 0.3%.
  • National Federation of Independent Business (NFIB) Optimism Index is expected to rise to 102 for December.

 

Q1/25: January – 1 holiday, 1 market close, 3 negative and 4 positive closes

  • Q4/24: December 1 holiday, 15 negative and 5 positive closes
  • November 10 negative and 9 positive closes
  • October: 8 positive and 15 negative closes

 

Companies in my headlights – It’s your decision; I provide ideas and context

I post about “indication intelligence” looking toward investment conferences … to assist investors with insight into sector vulnerabilities and strengths. A dictionary definition of “indicate” refers to something less than a certainty; an indication could be a signal of being oversold or overbought, a recommendation, or grounds for inferring or a basis for believing.

I’d like to mention but, insight is cloudy yet, electronic trading will play pick-up-sticks!

  • Keep your eyes on: AXGN, CRSP, VCEL, BPMC and VERV … positive moves
  • Keep your eyes on: BLFS, MRNA and MESO … negative moves

 

The BOTTOM LINE: Watch-out below as an up/down week begins on another downdraft.

Yesterday, was a mixed market session as the cell and gene therapy sector cruised to another abyss.; the JPMorgan Healthcare Conference is a place where deals begin to be announced.

As the conference kicked off, deals were announced from Eli Lilly (LLY), Johnson & Johnson (JNJ), and GSK (GSK)… positive news for biotech/cell therapy:

  • GSK Plc (GSK) is buying US cancer biotech IDRx for as much as $1.15 billion, Idrx is a clinical-stage biopharmaceutical company dedicated to transforming cancer treatment.
  • Eli Lilly (LLY) to acquire Scorpion Therapeutics' Breast Cancer Candidate For up to $2.5 Billion. The acquisition will expand LLY's oncology pipeline with STX-478, the differentiated and potentially best-in-class, mutant-selective PI3Kα inhibitor currently in a Phase 1/2 clinical trial. STX-478 could potentially address 30-40% of people with hormone-positive breast cancer, building on Lilly's advancements against this disease
  • Johnson & Johnson (JNJ) recent acquisition of Intra-Cellular Therapies was valued at $13.6 billion, is expected to contribute to long-term growth, particularly through Caplyta, a drug for bipolar depression and schizophrenia, with potential peak sales above $5 billion. Despite this, the deal is initially dilutive to earnings per share in 2025 but is projected to become accretive by 2030.

January ‘25 recap:

  • 1/13 - Monday’s advance/decline line ended with a negative close at the close of 11 incliner, 20 decliners and 4 flats
  • 1/10 - Friday’s advance/decline line mid-day ended with a negative close at the close of 29 incliner, 2 decliners and 4 flats
  • 1/9 - Thursday, markets were closed
  • 1/8 - Wednesday’s advance/decline line ended with a negative close at the close of 27 incliner, 27 decliners and 1 flat
  • 1/7 - Tuesday’s advance/decline line ended with a barely positive close at the close of 17 incliner, 16 decliners and 2 flats
  • 1/6 - Monday’s advance/decline line ended with a positive close at the close of 22 incliner, 12 decliners and 1 flat
  • 1/3 - Friday’s advance/decline line ended with a positive close at the close of 30 incliner, 8 decliners and 2 flats
  • 1 /2 - Thursday’s advance/decline line ended with a positive close at the close of 21 incliner, 12 decliners and 2 flats

 

An issue for the sector, the rising 10-year Treasury yield (^TNX) reached a 14-month high at 4.79%, pressuring stocks and creating competition for equity investments.

Earnings are a-comin’ … from Q4/24 are due … as downdrafts follow as proven in past sessions!

  • Big Point to remember “Think about it; the biggest problem the cell and gene therapy sector has …  99% of them have no earnings! If rates are higher for longer, that means that sector companies will continue to struggle or be unable to raise capital and therefore be subject to debt servicing firms!” <Me>

 

What could 2025 have in store for the capital access space as Partners are the gift of life!

  • "You'll see a number of cell and gene therapy comandantes drive for secondaries – they’re desperate for cash, but I do think a lot of cell and gene therapy sector companies NEED to be focused on what is driving their own growth —they're focused on a lot of change BUT … that's happening in the market… capital expansion is second.

I seem to be asking a question followed by a question …

  • Do we need to brace ourself for more economics and their down trending affect?
  • Is this market STILL “bubblicious” my concerns are macroeconomic and valuation

 

Welcome to my world of defining the “grey’ in our universe!

  • The sector is what it is, until it isn’t and even then, it doesn’t seem to be… as NOT much changes as the sector’s share pricing rides the waves of volatility, algorithms, electronic trading and short covering.
  • I am more frequently right than consequentially wrong; if I wanted to be liked, I wouldn’t have been an analyst/journalist.

 

Opinions expressed are those of the author and are subject to change, and not intended to be a forecast of future events, a guarantee of future results, nor investment advice. All investments are subject to risks. Investors should consider investment objectives.

Whether information or intelligence is good, bad or somewhere in between; I put into context what is relevant and useful for investors.  All investments are subject to risks. Investors should consider investment objectives.  Regulation Analyst Certification (Reg AC): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and it’s or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Henry McCusker, the editor and publisher of RegMed Investors could hold or have positions securities referred to in this publication and he will NOTIFY investors of holdings.