Would it be best to reduce one's position prior to May 12th?
I have been reluctant to reduce my position because I see a lot of positive catalysts for THRX that could lead to increased share price. Odds are very much in their favor for approval. They have the backing of GSK, and on top of that there are buyout rumors.
But I am new to investing in biotech and would like to get the opinions of those who have more long term familiarity with the sector. From what I have read so far, it sounds like even when the FDA decision is favorable some biotech stocks still sell off.
And after seeing the recent debacle with AVEO it has me wondering if holding a full position is worth the risk.
Thoughts or suggestions?
I have been through so many of these....
If the news is good, the price will drop.
If the news is bad, the price will drop.
In this case approval is expected and that expectation is built into the current price. This will be approved and it will pop when trading resumes in the PM session. There will also be a spike at the open the next day, then profit taking. Once profit taking subsides then the price will work back to where it is now.
I will be shorting this in the PM session after approval or the next trading session.
I recommend to sell all. If it is not approved, the SP will plummet much worse than it would go up in the case approval. You can buy the stock after the drug gets approved though. Trust me, I lost 75% with TTNP, I know how bad it feel when the odds go against us ,,,
jup. bios are a different breed..fda can do a 180 on a drug. the fda did not like aveo's trial design and that was the question for the fda panel. so aveo has to run another trial.. ttnp on the other hand was a 180 from the fda. i thought ttnp would get an approval. the fda had nothing bad in its brief docs, the fda panel gave a positive vote 10 -4 -1. the fda gave a crl on tuesday. run another trial on dosage..it dropped 80%..you just never know..
if breo gets approved i see thrx like some of my other plays..snts (approved in jan pps 11 to 13 then a slow move to 18) and aegn approved in dec 12 went from 22 to 27 slow move up to 42pps..
yes, it seems like if things play out like that, with a slow move up after approval, I could just buy THRX back as mbacsun suggested. My main concern is missing out on a big move up due to the approval or buyout news or something of that nature. It seems like THRX's decision to split into two companies was pretty well received. But I don't want to lose my gains either. So I'll have to make a decision soon.
I don't really think that one can call the FDA's decision to not approve TTNP's medical device and drug a 180. There were a lot of concerns regarding that and was one I would have been surprised if it was approved. Now, if Zoegenix's drug is approved, that will be a 180 as it did not get good marks from the advisory panel. I am really on the fence on THRX's approval. I think it can and will get approved eventually, but I wouldn't be surprised if the panel wants more data.