to continue our conversation, i agree this one looks interesting. big move over the last 12 months, i have been pondering whether (or not) to take an initial position. too bad they dont appear to have options, any ideas on that?
I am not an options player. My own technique is to winnow through the holdings of the more successful biotech investors - Baker Brothers, QVT, Ridgeback, etc. - looking for companies which have enough cash to continue for at least a year without secondaries, have some partnerships/collaborations with big pharmas, and have at least some drugs in phase II trials. If they already have an income stream, however small, that is a plus. Then you look at management, their track record, etc. As of the end of the first quarter, this one showed up in the holdings of Hambrecht & Quist and one other fund. And I think Adage, the big Boston hedge fund, which has a very broad portfolio, had a goodsized position. When the next 13-F's come out in a couple of weeks, I'll bet this is more widely held. So thanks for calling this one to my attention.
After a brief look at Puma, here's what I like: (1) Auerbach is obviously a very smart guy and he has brought over virtually the entire team from Cougar, the company that developed Zytiga and sold it to JNJ. (2) The phase II trial results in the subtype of breast cancer treated by Tykerb were much stronger than Tykerb's. (3) They have readouts of some interesting trials against smaller cancer target populations coming up very soon.
Mostly, I was really impressed with Auerbach's presentation at the G-S Healthcare symposium. On that basis alone, I am ready to take an initial position. If my position gets into the green, I'll add some more. I am drastically overweight in biopharma stocks, but it's been working very well for me. If I follow a company closely enough, I eventually come to a crude understanding of the science behind their drug or technique. Or think I do. I'm ready to stick my toe in here, even though it seems to have gotten ahead of itself a bit. that being the case, I'd probably add some more even if it drops off a little in the next week or two. What do you think?
Hi Bear. Funny how every stock I own you are also involved with. Bought PBYI at $19 and still own it. I would buy it on any pullback. For all the reasons you mentioned. Plus now in Phase III targeting a huge market obviously. And it's a buyout candidate. Also check out ACAD.
Hey Bear, I appreciate your though thoughtful response. I am also VERY overweight in Biotech (cldx, lgnd, snts, trsx, acrx, npsp).... Some I play with options, some I buy shares. Have learnt a lot over the last few years, one of which is to invest in 'under the radar' companies. Although I follow some of the mega bio investors like baker bros, I think because of their success they have become too large and they cause herd mentality when a new investment becomes public. Just my humble opinion. Puma fits my comfort zone, a little disappointed about the lack of option opportunity but will look to pick up 500 shares over the next week.