Respectfully, where do you get "the pipeline is chock-a-block with very promising candidates"? Elagolix is in the hands of Abbvie, thank goodness, VMAT2 is stumbling along, GPR119 hasn't been heard of since the partnership agreement with BI in 2010, Indiplon is dead, CRF with Glaxo is dead, Urocortin 2 is dead, and they haven't brought a new compound out of the lab since 2010. The two partnership agreements with Abbott and BI called for a potential of $755 million in milestone payments and from Gorman's mouth on the call, they will not get any milestone payments in 2014. That means that by the end of 2014, they will only have been paid $30 million, which is pitiful. If they had received a reasonable sum of milestones, this dilution would not have been necessary. Management at Neurocrine doesn't give a hoot about investors, they merely want to ensure the corporate teat is well stocked and they can keep sucking. Remember, 21 years in business and not a single commercial product!
PS: Having expressed my antipathy, I still have a stock count in the five figures, because I believe in Elagolix, Abbvie, and Neurocrine's 25% royalty stream when the drug is commercialized.
What we have here is a company achieving more success than anticipated. The pipeline is chock-a-block with very promising candidates that now need to advance to the next step. The reality is these steps are expensive and, with the stock trading around $18, it's not a bad time to hand the plate around to collect the needed alms. Had this secondary occurred just a few months ago, dilution would have been over 20% instead of the paltry 10% now needed. Accumulate on the dips.
Well said and informative. The management of this co, with its wonderful medical research dept, (at least formerly) is among the worst imo.
Any guess as to what the pps will be?
Whoever invests in this better look very closely at how NBIX changed their endpoints from Kinect-I to Kinect-2. NBIX was apparently "reprimanded" by the FDA as mentioned in a previous post. I bet this is related.
There are ways to "prove" things are statistically significant that truly may not be. Changing how you measure outcomes on the fly in order to prove what you want to prove is one way. I'm sure the FDA will look carefully into this, even though NBIX says the results are "real". They may require another phase II study - hence the need for more cash even though they have more than $100 million on hand. Also we need to see the safety data from second study. What happens to patients when the dose is increased? On Jan 9 the safety data from the first study was released, not the second study.
Now we know why insiders sold and why Morgan Stanley and Alpha Street downgraded.
NBIX has a market cap of over 1.2 billion - almost what it would be if they could currently generate revenue from selling NBI-98854. So the company is overvalued. Moreover, FDA approval is no guarantee and far away if the FDA sees problems in what NBIX has done between Kinect1 and Kinect2.
I bet whoever invests in NBIX will realize this. 7-8 million shares is more than 10% dilution. Maybe a generous starting point for pps is $15. That is about 10% below where the CEO dumped 40% of his stake.
Frankly I think it ought to be lower. This company definitely should have a market cap of less than $1billion. $10/share would yield a market cap of $750 million after dilution to about 75 million shares. But I recognize that would be drastic. I bet investors end up overpaying at $14-15. Things just do not seem right to me about this company. Maybe people have already priced in positive results on Elagolix Phase IIb which should be out soon. Even if that data is good, it should now warrant a "sell the news".
Sentiment: Strong Sell
Important information --- for whom? How does it affect Neurocrine? Please explain. Thanks in advance.
The wonderful thing about history is that more gets created every day. I'm betting that, once we've made a few more years of history, NBIX will have left the ^NBI in its wake!
Neurocrine has had a huge rise recently due to the Kinect2 trial results announced in January. That is all fine and good, and I certainly appreciate the appreciation. If you look at the long term story however, it is a little different. Using Yahoo's intereactive chart and comparing NBIX to ^NBI, the Biotech Index, ^NBI outperforms NBIX for the 1 Year, 2 Year, and Max (approx 18 years) periods. For the Max period NBIX is up 58% while ^NBI is up over 700%. I realize that is history, but history can be informative.
I like the part where he says, "we sat down with management and there were smiles on their faces". Haha, I'd be smiling to, if I was able to off load more then 200,000 share at peak prices. Not once, but twice. Managements laughing all the way to the bank. Mostly laughing at institutions and retailers holding the bag.
I see another price target, $19. Keeps getting lower and lower.
Hide and watch. You don't remember when CEO Gorman said he would not have a secondary when the stock was trading a little over $2 and did one at $1.94. The next time as the stock breached $10 for the first time since Indiplon, he diluted again at $8 and something. I am long this stock, but I am very suspicious of management. Gorman and some others have been at Neurocrine since it was founded in 1993 and the company has yet to produce a single commercial product. The only reason I am in the stock still is because Abbvie has complete control of Elagolix.
I am more interested in the direction of this stock, then I am about spelling. If I am short and wrong, then it would be wise to cover my short interest and go long. I had to short the stock. I am willing to lose my nice little profit shorting twitter, in order to prove myself right, that this stock shouldn't have a 1.4 billion dollar market cap (maybe $400 million). Unless I can find something (other then the safety and effectiveness of a failed 50mg drug) that made this stock pop $10, shorting it only makes since.
it is also interesting that you are obviously short...That is fine, just say so, but please do not insult the intelligence of us that can spot your type from miles away with your "questions"...and spell check would not hurt either!
I was looking at insider ownership and it looks like they just about sold all their shares. The institutional ownership in this stock is very large. There's quite a few institutions that own their shares at $11.31. I wander whose company, the analysts represents, to write articals pricing the stock so high.
It isn"t hard to see that the stock is being manipulated. There is just not enough buyers out there to support the number of shares these institution need to sell without losing a lot of money. Every time they go to sell, it drops alot on minimum shares. Just look at AH, .83 on 10,000 shares.
I am not one to short a stock, but I can"t find a single reason to be long on this stock. If the drug is no different then the placebo, then how would it have any kind of safety issues or not be efficient? Wait, maybe we should be asking the roughly 16% that didn't finish the testing.
This latest news, that made this stock pop, seems rather strange. First, in Sep. the company came out with new that the 50mg did not beat the placebo group. The stock begins to drop, insiders sell at the top, and finally the stop drops big.
The 100mg might work, but the tolerability is questionable. I thought a second trial was for the 100mg dose. But, then out comes news, about the safety and effeciency of the 50mg dose. The trial never compared the 50g dose to the placebo controll arm in the last 6 weeks. The 50mg dose,stated earlier in Sep., to not work.
The stock pops 10 pt.. Now, insiders are selling again and analyst are quoteing target prices at $23. What is wrong with this picture. Not to mention, the horrible quarter, and future guideance.
Does anyone know, for any reason why this company is worth more then $6 a share.
What was so great about it? Operating expenses increasing, no milestones in 2014, no mention of the new compounds hinted at in the press release. Dilution is a real possibility to keep the gravy train going.