RegMed Investors (RMi) Closing Bell: adding to investor agita

January 28, 2025 4:29pm

I reiterate, don't chase the cell and gene therapy sector, wait for some stability

Never leave an investor uninformed!  I say today what others won't, so you can do what others can't!

On point, short on words, long on facts and being judicious!

I follow the dictum, quoting Churchill that “short words are best, and the old words when short are best of all.”

RegMed Investors’ (RMi) pre-open: The Strange Case of Dr. Jekyll and Mr. Hyde … https://www.regmedinvestors.com/articles/13782

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

Tuesday: The Dow closed UP +136.77 points or +0.31%, the S&P closed UP +55.42 points or +0.92% while the Nasdaq closed UP +391.75 points or +2.03%

• Indexes gravitated Tuesday recovering from a sell-off sparked by the Chinese artificial intelligence startup DeepSeek

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

• Durable goods demand declined 2.2% for the period, the 4^th drop over the past 5 months, including a 2% slide in November. Economists had been looking for an increase of 0.5%. Excluding transportation, orders showed a 0.3% increase. Nondefense aircraft and parts orders tumbled 45.7%.       

Tuesday’s advance/decline line at the open was negative with 9 incliners, 24 declined and 3 flats; ending with a negative close at the close of 14 incliner, 17 decliners and 4 flats

• As compared to Monday’s advance/decline line at the open was positive with 25 incliners, 8 declined and 2 flats; ending with a negative close at the close of 12 incliner, 21 decliners and 2 flats

Metrics:  Tuesday, the IBB was up +0.57%, the XBI was down -0.21% while the VIX was down -11.49 points or -8.31% at 16.41

Q1/25 – 2 holidays, 1 market close, 8 negative and 9 positive closes

• Q4/24 – 1 holiday, 6 positive and 15 negative closes
• November – 1 holiday, 10 negative and 10 positive closes
• October: 8 positive and 15 negative sessions

Tuesday’s Closing Down (10 of 17):

• Ultragenyx Pharmaceuticals (RARE -$0.78 after Monday’s -$0.78),
• Beam Therapeutics (BEAM -$0.65),
• Intellia Therapeutics (NTLA -$0.54 after Monday’s -$0.44),
• Verve Therapeutics (VERV -$0.51),
• uniQure NV (QURE -$0.48 after Monday’s +$0.13),
• Adverum Biotechnologies (ADVM -$0.35 after Monday’s +$0.29),
• Prime Medicine (PRME -$0.20),
• Sage Therapeutics (SAGE -$0.09 after Monday’s +$0.34),
• Brainstorm Cell Therapeutics (BCLI -$0.09),
• Caribou Biosciences (CRBU -$0.08)

Flat (4)

• Cellectis SA (CLLS)
• Harvard Apparatus (OTCQB: HRGN)
• Homology Medicine (FIXX)
• Sangamo Therapeutics (SGMO)

Tuesday’s Closing Up (10 of 14):

• Moderna (MRNA +$3.29)
• Alnylam Pharmaceuticals (ALNY +$2.77 after Monday’s -$2.03),
• Lenz Therapeutics (LENZ +$1.58).
• Blueprint Medicine (BPMC +$0.59 after Monday’s -$1.03),
• AxoGen (AXGN +$0.48 after Monday’s -$0.21),
• Mesoblast (MESO +$0.44 after Monday’s -$0.39),
• Compass Therapeutics (CMPX +$0.40 after Monday’s +$0.17),
• Vericel (VCEL +$0.39 after Monday’s +$2.29),
• MiMedx (MDXG +$0.35),
• BioLife Solutions (BLFS +$0.21 after Monday’s +$0.50),

The BOTTOM LINE:  NO rebound but a slowing of the downside on Tuesday, as I wrote this a.m., “Risk versus uncertainty – which is worst?”

Not good to ask a question with aa question … look really closely at the sensitivity to the sector’s share pricing’s downfall ... there is the micro and less of the macro … you want to focus on what’s oversold pre-earnings release— not Nvidia, not indexes, the sector is OUR key.

As sector earnings season is about to begin; There are a lot of questions that need to be answered before investors can really make an educated decision on how they want to deal with their exposures.

• It comes down to just … ride it out as share pricing usually bounces back!

January ‘25 recap: understand the “flow” …

• 1/28 - Wednesday ended with a negative close at the close of 14 incliner, 17 decliners and 4 flats
• 1/27 -Monday ended with a negative close at the close of 12 incliner, 21 decliners and 2 flats

• 1/24 – Friday ended with a negative close at the close of 12 incliner, 22 decliners and 1 flat
• 1/23 - Thursday ended with a positive close at the close of 26 incliner, 4 decliners and 5 flats
• 1/22 - Wednesday ended with a positive close at the close of 18 incliner, 14 decliners and 3 flats
• 1/21 - Tuesday ended with a positive close at the close of 28 incliner, 6 decliners and 1 flat
• 1/20 – Markets were closed

As I have written “Many sector companies are engaged in cost realignment programs, which won’t be realized consequences over the next few Qs where the operating expense levels; spending on SG&A (selling, informational, and administrative) and R&D (research and development) facilitate the need to extend runways and enable expectation of clinical innovations.”

• "I think the market's going to come back to earnings, the first couple of months of 2025, and 1st H/25 will be a shifting cell and gene therapy sector due to earnings releases... I still believe stocks will swing upward pre and them more post releases

Big Point to remember “Think about it; the biggest problem the cell and gene therapy sector it’s all to the future …  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!”
•  2024 saw very little life IPOs (initial public offering) market and secondaries – I have seen private investments, mortgages, sell-offs, as companies deferred and struggle to gain further market access i.e., public. <Me>

What could 2025 have in store for the capital access space?

• "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 pipelines … capital expansion is second.

Why do I keep repeating, so investors can make the connection …

The top three (3) performing in the session:    

• Tuesday: Alnylam Pharmaceuticals (ALNY), Moderna (MRNA) and AxoGen (AXGN)
• Monday: Vericel (VCEL), BioLife Solutions BLFS) and Sage Therapeutics (SAGE)
• Friday: Mesoblast (MESO) and Ionis Pharmaceuticals (IONS)

The worst three (3) in the session: 

• Tuesday: Beam therapeutics (BEAM), uniQure NV (QURE) and Adverum Biotechnologies (ADVM)
• Monday: Alnylam Pharmaceuticals (ALNY), CRISPR Therapeutics (CRSP) and Blueprint Medicine (BPMC)
• Friday: Moderna (MRNA), CRISPR Therapeutics (CRSP) and AxoGen (AXGN)

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

• Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and facts are its product; I can always be WRONG but … I am mostly EARLY!”

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. 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.

Henry McCusker, the editor, and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication. 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.