Monday, August 1, 2016

Stock Analysis: Ionis Pharmaceuticals (IONS)

Notes:
Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning.

Today it was announced that Biogen is going to exercise its option to commercialize Nusinersen globally and is paying Ionis $75 million for the rights, with potential for $150M more in future milestones with a mid-teens royalty fee for future sales.  This is all a result of the drug reaching a primary endpoint in its ENDEAR, phase 3, study with an acceptable safety profile.  This points to significantly positive results that are so valuable, they intend on switching control patients over to the drug as soon as possible to get them on the therapy.  

This is big news for Ionis, who has been plagued by a beleaguered biotech sector and alarming news with Glaxo-Smith Klein decided not to pursue their own phase 3 study due to low platelet counts.  The latter is what had me particularly scared, as this had the potential to impact the entire platform that Ionis was based on.  These results we received today, help confirm that the platform is stable, which lends more credence to the possibilities in the future when they have 38 different possible therapies in the pipeline.  

As a result of this positive news, the stock rose over 30% today.  It's amazing how the charts were indicating an upward trend, but I never expected this.  This is the confirmation I was looking for to get back in the stock.  Unfortunately it popped huge on the news.  I'm now upgrading the stock based on this new set of data from a 3 to a 1.  That said, I'm hoping there is a pullback created by people taking profits from their purchases in the 20s to allow a better price point to get in and complete my position.

Nothing on this site should be taken as advice, research, or an invitation to buy or sell any securities.  All views expressed are solely of my own and I am not a professional money manager.  Please consult with your financial adviser before taking any action in your own portfolio.