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Insmed Incorporated Message Board

  • fudfighter4 fudfighter4 Aug 11, 2013 12:12 PM Flag

    This is how another BOD used Phase III success

    Satltsasw, re your -

    "You will also know that a biotech barely out of R&D can't demand the crazy valuations on an offering that you and fud are preaching about here."

    - here's how another biotech "barely out of R&D" raised money in 2009 -

    Date - Open - High - Low - Close - Shares traded

    July 01 - 3.05 - 3.05 - 2.87 - 2.92 - 4,859,325
    July 08 - 2.65 - 2.67 - 2.25 - 2.39 - 7,129,992
    July 15 - 2.53 - 2.85 - 2.53 - 2.75 - 7,890,613

    July 20 - Human Genome Sciences, Inc. (Nasdaq: HGSI) and GlaxoSmithKline PLC (GSK) today announced that BENLYSTA™ (belimumab, formerly LymphoStat-B®) met the primary endpoint in BLISS-52, the first of two pivotal Phase 3 trials in patients with serologically active systemic lupus erythematosus (SLE).

    July 22 - 14.50 - 14.83 - 13.35 - 14.05 - 33,920,750

    July 28 - Human Genome Sciences, Inc. (HGSI) today announced the pricing of its underwritten public offering of 23,215,000 newly issued shares of its common stock at a price to the public of $14.00 per share. The size of the offering was increased from the originally announced 18,000,000 shares. The Company also granted the underwriters a 30-day option to purchase up to an additional 3,482,250 shares of the Company's common stock.

    July 29 - 14.32 - 15.45 - 14.15 - 14.71 - 29,962,190
    Aug 05 - 15.16 - 15.18 - 14.58 - 14.90 - 6,429,720
    Aug 12 - 15.85 - 16.50 - 15.76 - 16.21 - 8,721,898
    Aug 19 - 15.25 - 15.95 - 15.25 - 15.86 - 5,616,838
    Aug 26 - 22.00 - 22.78 - 19.42 - 20.50 - 39,614,900

    "Benlysta worldwide sales should reach $3.1 billion by 2014, if it is priced at around $30,000 a year."

    That 2009 market valuation was based upon predicted use of Benlysta by 100,000 patients by 2014. 50,000 patients are treated for NTM each year in the US alone.

    The HGSI BOD diluted its shareholders by 17% to raise $310 million (net of $325 million). The Insmed BOD has diluted us by 44% to raise $93 million - and will need to raise more cash next year.

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    • Tessssssst - you miss the point. Whereas Phase III success increased the HGSI share price, it DECREASED the INSM share price.

      May 15 -

      Lazard Capital initiates coverage on Insmed with a Buy. PT $21.00.

      May 22 -

      Leerink Swann today ... raised its price target to $22.00 (from $13.00). After speaking with multiple MEDACorp KOLs and performing an extensive review of applicable literature, we have developed more conviction that Arikace is poised to be become a first-in-line treatment for non-tuberculous mycobacteria (NTM) infections," said analyst Joseph P. Schwartz.

      "We believe NTM may present an even more compelling market opportunity than CF, since there are no FDA approved treatments and 50,000 U.S. patients," he added.

      May 22 -

      Wedbush today ... raised its price target to $18.00 (from $11.00). Analyst Gregory R. Wade expects a positive outcome from ARIKACE Phase III trial for CF.

      "We estimate that ARIKACE represents at least a $300-million worldwide opportunity for the management of chronic Pa infections in patients with CF. We note there is additional upside to our market estimates should ARIKACE pricing come in higher than our estimated $6000/cycle estimate."

      Revenue of $300 million at $39,000 per patient assumes 7,692 patients using Arikace. A current valuation of $18 a share could only be justified if Arikace was expected to FAIL as a therapy for NTM.

      May 23 -

      The Insmed BOD adopts resolutions with relevance to a potential share offering.

      Date ........ High ... Low

      May 30 ... 14.30 ... 13.25
      June 13 ... 12.81 ... 11.82
      July 01 ... 10.65 ... 09.00

      With a market valuation already substantially lower than warranted by conservative revenue projections, and with the expected accumulation of millions of shares in June by the Russell 3000 tracker funds, the investors who subsequently shorted millions of shares had no reason to expect an opportunity to cover at an even lower price ..... unless they traded illegally on non-public information.

      • 4 Replies to fudfighter4
      • Bugseypug - re your -

        "Yes, the shorts have helped push the SP down, but only by a few bucks...not the $20 you are claiming."

        - it makes a refreshing change to find somebody with a clear understanding of what happened. For the benefit of the other investors who use this forum would you mind sharing the reasoning which led to that conclusion please?

      • Tessssssst, re your -

        "I know I've said this many times, but there is absolutely no evidence that shorting happened definately before the new release - it could have equally happened after and this is more likely given the disappointing results. When a analyst says "we think its still viabale" that kind of tells you that the results were disappointing. In fact the Friday before, there was heavy buying not selling."

        1. You forgot to mention that the analyst in question was SO disappointed by Phase III results which guaranteed Arikace will displace Tobi as the central therapy in the CF antibiotic regimen that he increased his price target to $24.

        2. The shorting occurred both before and after the release of the results on July 1. How do you think the share price dropped so far below $14.30, during a period when investors could see that the stock was substantially undervalued, and four or five million shares were accumulated on behalf of the Russell 3000 tracker funds? Can you suggest a credible reason* for shareholders to have SOLD four or five million shares in those circumstances?

        3. The Friday before July 1 was the day on which the tracker funds actually bought their shares. Do you think that might have anything to so with the "heavy buying" you noticed?

        4. I think we've just got to the part where you offer a calculation which supports a belief on the part of the Shorts that the stock was overvalued at $12 with Phase III success ..... unless you're just another in the long line of wannabe shysters who ask us to believe they are unable to calculate valuation while at the same time asking us to believe $30 would be an unreasonable valuation.

        * As opposed to the ludicrous cover story of "disappointing results" (see 1) which assumed major investors cannot calculate valuation

      • I know I've said this many times, but there is absolutely no evidence that shorting happened definately before the new release - it could have equally happened after and this is more likely given the disappointing results. When a analyst says "we think its still viabale" that kind of tells you that the results were disappointing.

        In fact the Friday before, there was heavy buying not selling. Why can't you get that? Secondly, our BOD could not do the same as HGSI precisely because the results were not as good and the price didn't go up 700%. Thirdly, what was the price action in HGSI before the news release - had it climbed 300% and was ready to be dumped at the slightest disappointment? What were the analyst predictions for HGSI after the news came out that the BOD ignored in setting the PO price? In fact what a corrupt BOD at HGSI - the PO was at only $14 and yet it went to over 30 a few months later? Were you on that Message Board screaming - insider info! insider info! Oh dear me....

        Sentiment: Strong Buy

      • No that is the point exactly.

    • Yup exactly what insmed did too. PO slightly below market price following news release.

    • Terry, re your -

      "An analogy from 2009 ( stock market hyperbole) with a company that had approvals and results in hand comparing it to Insmed in 2013 ..."

      - I don't recall HGSI having an approved drug before Benlysta was finally approved by the FDA in 2011. But I do distinctly recall HGSI having an operating loss in 2010 of $190,773,000 - which makes me wonder if this was another one of your lies.

      If not, to what "approvals and results in hand" do you refer?

      But even with that horrendous cash burn the investors who bought shares in the July 2009 offering valued HGSI at over $2 billion - whereas the recent offering valued Insmed at less than $400 million.

      The success of Arikace in the EU CF pivotal clinical trial would appear to all but guarantee FDA approval of Arikace both for CF and for NTM -

      1. As regards CF - better compliance with antibiotic regimens is such a high priority with the FDA that it approved Tobramycin Inhalation Powder despite the concerns of FDA staff not only that TIP is associated with more adverse effects than is the inhalation solution but also that in one of its clinical trials, TIP failed to evidence superior efficacy to a PLACEBO.

      Once-daily Arikace will deliver far better compliance than anything currently available, plus sustained efficacy. It's quite amusing watching you hinting that the recent offering was to fund a US CF clinical trial.

      2. As regards NTM - Amikacin injection is routinely used to treat NTM pulmonary infection. Mycobacterial infection in the lungs is based in dead tissue in the airways this side of the interstitial fluid, some distance away from the blood vessels. Arikace has now proved at Phase III that it delivers amikacin to a pulmonary infection. How can inhaled amikacin not be more effective against NTM than amikacin delivered via the bloodstream?

      Insmed, the analysts and the institutional investors know all this - so why the vast difference in valuation between the HGSI offering and the Insmed offering?

    • An analogy from 2009 ( stock market hyperbole) with a company that had approvals and results in hand comparing it to Insmed in 2013 is about as stupid as saying Funds should pay 30 dollars for Russell or that banks should listen to Insmeds paid analysts for offering price.... OK charts over and Insmeds is pivoting... surfs up ! go outside and as they say in Britain- look for a sunny spell......

 
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