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Arena Pharmaceuticals, Inc. Message Board

bearofbleecker 9081 posts  |  Last Activity: 23 hours ago Member since: Jul 27, 2000
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  • Reply to

    Patient Count...

    by congoisking Nov 21, 2014 2:51 PM
    bearofbleecker bearofbleecker 23 hours ago Flag

    Nothing is more fatal in investing than the need to be proven right.

  • To the degree that insurers try to limit the availability of Sovaldi/Harvoni to the most serious cases, it seems to me that they are cutting off their noses to spite their face. There are two groups of HepC patients in the US (1) The older, shrinking group who contracted the disease through blood transfusions in the '80's, and (2) The younger, growing group who contract the disease through dirty needles, tattooing, etc. If you only treat the most advanced cases, you do very little to shrink the latter group. In fact, you are, in effect, "farming" advanced HepC cases as members of this group progress to later stages of he disease. As an insurer focused on short term profits, perhaps this is justifiable. But as a matter of national health policy, it makes more sense to attack the disease at its reservoirs in prisons, drug treatment centers, etc. and essentially wipe it out.

  • Reply to

    So let;s analyze this...

    by akadvisor2014 Nov 21, 2014 12:51 PM
    bearofbleecker bearofbleecker 23 hours ago Flag

    At first, I put the post-earnings dropoff to the MM's replenishing their inventory. But, after it went on for several days, I think you have to recognize it as organized disciplined selling. Premarket, the tape is painted with a few small trades above the previous day's close. It is then run up quickly in a little headfake rally to take out the stops of the shorts and encourage those who are awaiting the big move up, after which it is sold off into the close. Look at the chart to the right of this page and you will see this pattern repeated - even on the 18'th when it closed higher due to the European approval. We could concoct various benign theories - a hedge fund facing margin calls on a disastrous long position in oil, etc. But the simultaneous rise in ABBV suggests that there is skepticism about GILD's ability to maintain the forecasted revenue stream and market share in HepC in the face of competition and resistance from the insurers. So even the strong initial script numbers do not seem to help. My own response has been to hold my GILD positions in my taxable accounts, but hedge them with ABBV, while in my IRA I now have a larger position in ABBV and a relatively small one in GILD. (Which, after selling out at 112.80, I have tried to reestablish at 108, 104, and now, 100.80. The money I've lost climbing back in has almost completely offset the money I saved by selling out pre-earnings.) I still believe that GILD will dominate HepC treatment and will continue to try to rebuild the position. Someday Lucy may really hold the football.

  • Reply to

    GILD DROPPED FROM Goldmans VIP list

    by notsoobviousman1 Nov 21, 2014 4:49 PM
    bearofbleecker bearofbleecker 23 hours ago Flag

    If you recall, GILD recently was put on Goldman's list of "most overvalued stocks". Not overvalued in terms of earnings potential, cash flow, revenue, etc. Overvalued in terms of how much higher they were trading than Goldman's price target. So, if your stock is trading at 100 and Goldman's price target is 60, it's not that Goldman was wrong, it's that the market is wrong in not recognizing Goldman's perfect judgment. Actually, their "most overvalued stocks" list should be called "our analysts' biggest screw-ups".

  • Reply to

    Must read!!!!!

    by cedell007 Nov 21, 2014 5:12 AM
    bearofbleecker bearofbleecker Nov 21, 2014 8:38 PM Flag

    Barron's did a thorough study of Cramer's recommendations a couple of years ago and concluded (1) That someone was being tipped to his buy/sell recos, and (2) the only way you could make money on his buy/sell recos was to trade against them. (short his buys, buy his sells.) Although he is consistently wrong, he has been more conspicuously wrong lately. He was stirring up the Ebola hysteria, cautioning against buying airlines, cruise lines, etc. Fortunately, this created an opportunity for me to buy AAL at 29 and CCL at 35. He (or the people who author his motormouthed spiels) know nothing about biotech. One of the great opportunities his ignorance created was when Kyrpolis was approved for multiple myeloma and he announced that this would send CELG into the tank, dropping the stock 8 bucks after hours. Realizing that the approval of Kyrpolis was actually good for CELG, I bought it at what turned out to be a huge bargain. His biotech guru on The Street, Adam Feurstein, was recently dead wrong on AVNR, which virtually tripled overnight. (PS Does everyone in New York now talk at 200 words per minute, or is Cramer possibly on some kind of drug?)

  • bearofbleecker bearofbleecker Nov 21, 2014 8:15 PM Flag

    Raleigh, although it's tempting to put it down to sinister agendas, perhaps sheer ineptitude is a better explanation. I note that while the S&P is up 11.64% ytd, GS is up a pitiful 6.96%. If you are wired in with all the key decision makers and have access to unlimited capital and leverage, shouldn't you be able to at least match the averages? Apparently not. When, during the financial crisis, it became apparent that they were feathering their own nest at the expense of their clients, I think their mystique was fatally damaged. I note that since they rebounded to 184.35 on Aug. 31, 2009 ( the moment when they decided that they were actually a bank and could go to the Fed (us) for rescue) they have essentially gone nowhere. JPM has done much better. WFC has almost doubled since that date. MS, a rough equivalent, has also done much better. As has EVR, an investment bank which makes a point of not trading against its clients. Why, after all, would you want to buy stock in a company which rewards its partners royally first (even when they screw up) and then distributes the crumbs to their stockholders? A broken model. My price target is 64.

  • Will someone at Goldman-Sachs shake the GILD analyst and see if he/she is still alive? I have the uneasy feeling that he/she has been slumped over his/her desk for the past year in a state which has been misinterpreted as mental exhaustion but is actually rigor mortis. I note that on February 5 of this year (just 2 weeks before the big biotech selloff) Goldman raised its price target on GILD from 75 to 82. The stock was selling at 78 that day, but proceeded to slide (along with the entire biotech sector) to a low of 64.81 on April 10. So, at this point, if you bought on the strength of Goldman's upgrade, you are down more than 13 points.
    As the biotechs were starting to recover, Goldman again displayed their acute sense of timing by downgrading GILD on April 14, cutting their price target from 77 to 68. The stock closed that day at 66.79, but proceeded to march up to an alltime high of 116.83 on October 31. Now, along with the 13 points you lost by listening to Goldman in February, you have missed another 50 points of gain. If you had disbelieved Goldman and sold when they were counseling you to buy and bought when they were counseling you to sell, you would have had a two-bagger over 9 months.
    Perhaps they were delivering the bonus check to their GILD analyst and, after stuffing it into his/her gaping mouth, and noticing the unmistakable odor of decaying flesh, suspended their coverage of GILD. Or perhaps they're going for the hat trick.

  • bearofbleecker bearofbleecker Nov 21, 2014 4:42 PM Flag

    To all those who expect that ABBV will someday have a meaningful share of the HepC market, I say,
    "I drink your milkshake!"

  • I added shares today at 100.90 (too soon) and 100.58. But I'd venture to say that about 90% of the trading in this stock these days is phony - just the MM's passing shares from one hand to the other. I also unloaded 1/3 of my ABBV hedge. Ironic that a stock with the POSSIBILITY of a PIECE of the HepC market is doing so much better than a stock with a hugely profitable dominant share of that market. But while the ABBV partisans dream of all that as-yet-unrealized revenue, I say, as did Plainview in "There Will be Blood", ....
    "I drink your milkshake!"

  • Reply to

    Script numbers anyone

    by elgrego1 Nov 21, 2014 10:54 AM
    bearofbleecker bearofbleecker Nov 21, 2014 12:49 PM Flag

    Right now, with ABBV falling a bit off its high, I think I'll start adding here at 100.92.

  • Reply to

    right now I hate GILD, but....

    by eckgar1 Nov 21, 2014 12:01 PM
    bearofbleecker bearofbleecker Nov 21, 2014 12:30 PM Flag

    Keeping GILD positions in my taxable accounts, along with smaller hedging position in ABBV. Smaller GILD position in my IRA, with a much larger ABBV position. The moment ABBV gets approval, I, like everyone else, will dump it.

  • Reply to

    Script numbers anyone

    by elgrego1 Nov 21, 2014 10:54 AM
    bearofbleecker bearofbleecker Nov 21, 2014 12:24 PM Flag

    Watch the last 15 minutes. I think we'll be up. In any event, I intend to add shares toward the close.

  • bearofbleecker bearofbleecker Nov 21, 2014 12:19 PM Flag

    I think you're exactly right, even in the face of the apparent European approval for ABBV's therapy. However, by the end of the session, I think the Dec 110 calls will be dictating price action. At the moment (12:17ET), they are trending up at 95 cents. This is already a huge position with 41,132 contracts.

  • Reply to

    Script numbers anyone

    by elgrego1 Nov 21, 2014 10:54 AM
    bearofbleecker bearofbleecker Nov 21, 2014 12:03 PM Flag

    FBR, maintaining their 130 price target, notes total script numbers (Harvoni + Solvaldi) at 6,228, a 7% increase over the prior week. Harvoni scripts 2,954, a 21% increase. They also note that for 4 out of the 5 days last week, the AASLD (Liver Disease) conference was under way and presumably many hepatologists were out of their offices and not writing prescriptions.

  • bearofbleecker bearofbleecker Nov 20, 2014 2:26 PM Flag

    This calls to mind the ancient joke about the kid who is given two $10 bills by his mother and told to pick up her regular $20 prescription at the pharmacy. The kid, who has a larcenous steak, pockets one of the bills and folds the other one up. He passes the folded bill to the pharmacist, snatches the bottle of pills and runs for the door. When the pharmacist realizes that he only has $10, he calls out, "Don't run, kid - I still made nine bucks!"

  • bearofbleecker bearofbleecker Nov 19, 2014 11:19 PM Flag

    Looking at your past posts, you also seem to have your life savings in GSAT. And while you have been pouring your lfe's blood into GILD, you seem to have been foreseeing a breakdown into the 90's. And imaging wonderful things for ABBV. It's one thing to be a liar, but sadder yet to be a clumsy liar.

  • Reply to

    Cramer late to the party

    by markusgzee Nov 18, 2014 12:57 PM
    bearofbleecker bearofbleecker Nov 19, 2014 1:46 AM Flag

    Cramer was leading the Ebola hysteria. I suppose I should thank him, since it enabled me to take a large position at bargain prices. He seems to be ranting and raving more than ever, totally dominating what he has made a farcial program, with the more intelligent commentators flattering him and deferring to him.

  • bearofbleecker bearofbleecker Nov 17, 2014 2:12 PM Flag

    If we go there, we will hit a lot of stops, I think. Be careful what you wish for.

  • Reply to

    Buffoons

    by notsoobviousman1 Nov 17, 2014 11:22 AM
    bearofbleecker bearofbleecker Nov 17, 2014 1:57 PM Flag

    If you think that the drop in this stock is due to the pipsqueaks on Stocktwits and Twitter, you are mistaken, I think. The retail investor, as clearly evidenced here, is overwhelmingly positive on this stock. The stock is going down in the face of boosted price targets, strong scripts, and a lot of positive PR.

  • Reply to

    Buffoons

    by notsoobviousman1 Nov 17, 2014 11:22 AM
    bearofbleecker bearofbleecker Nov 17, 2014 1:41 PM Flag

    I am long this stock, but I think that something real is going on here. We had a strong base at 110 before earnings, which, if I recall correctly, went up close to 114. After very strong earnings, and a brief sell-on-the-news falloff, it made a new alltime high at 116.83. However, during the first half of November, the stock has dropped about 12%, even while the scripts for the Harvoni intro have been very strong. It might be argued that the IBB has fallen about 3% during this time; however, since GILD is about 8.5% of the IBB, this is inevitable. Meanwhile, ABBV has advanced about 4%. Every day, we begin with a little false rally, after which the stock is sold off. To me, this looks like disciplined selling by large holders. Outside of my IRA, I am locked into my GILD positions by tax considerations. But I have hedged those positions with ABBV, and in my IRA, I have cut my GILD position by 80% and taken a larger hedging position in ABBV. I am familiar with all of the arguments about low p/e, superior HepC drug profile, promising pipeline, etc. But with GILD representing about 15% of my portfolio, I was overexposed to this stock. Now, at about 8%, with a hedge in place and buy orders in below 100, I am worrying less.

ARNA
4.17-0.01(-0.24%)Nov 21 4:00 PMEST

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