AF reports on sensitive subjects. That's what journalists do. All he did was present the bear view. He made no subjective statements about whether he agrees, and to the contrary, has repeatedly stated previously that he disagrees with it.
I, for one, like knowing what the bear thesis is, and frankly, any reasonable investor should. It's good to dissect it to decide if your investment still holds up. In my view, the bear thesis is flawed. Simply put, the FDA not only agreed to accept the NDA, but the final meeting that led to the NDA acceptance was touted as highly productive. Additionally, the small n is no longer going to apply. The FDA wanted more data. By the time Adcom rolls around, they'll have plenty of more data (and they already do). I don't think the FDA would have accepted the NDA if they planned on rejecting the drug. The FDA knows that the Adcom review is going to be overwhelmingly positive for recommending approval for eteplirsen. They aren't stupid, and in the face of that, there's no way they reject its approval. Add to this the fact that over 90% of new drugs are being approved, and I think it's a lock. The FDA wouldn't have filed the NDA if they planned to reject. Bears are effed.
If the FDA saw the B4 data, then Dr. Kunkel obviously did as well. Do you think the man who first discovered dystrophin would have agreed to join SRPT if that data were underwhelming?
I'm sure I'll get bashed here, but I'm simply giving food for thought and suggesting people consider hedging (or not try to catch a falling knife) in the event of perceived bad news. These are only possibilities, but try as we might to convince ourselves they are remote possibilities, they are still very real possibilities. I do not own any SRPT shorts (I never short biotechs, even if I think they are junk), nor do I currently own any puts. (I might buy puts in the future to hedge my longs. Puts have a finite loss. Shorts do not.) For the record, I believe that etep's Adcom vote will be overwhelmingly positive, that etep will be approved, and that etep will own the market. I am not an SRPT bear, nor have I ever been.
I am hoping SRPT hears from the FDA about an 11/23 Adcom this week. In that case, most of these points would no longer apply. If this happens, I will certainly add to my position in the coming weeks, depending on market conditions.
1. The biotech meltdown is currently on the cusp of another potentially big drop. If this happens, lack of news from the FDA on SRPT's Adcom will weigh heavily on the stock. Do not be surprised to see IBB drop as low as 250.
2. It is possible that the FDA schedules etep's Adcom in January. BMRN's Adcom is only one month before their PDUFA, so it's not unreasonable to consider the same for SRPT.
3. If #2 occurs, it could have a significantly negative effect on the stock if a) BMRN's Adcom is positive, and b) drisapersen is approved before etep is even reviewed. Do not discount this possibility. It's very real.
We know that eteplirsen is superior, but please do not fool yourself into believing that the market won't crush SRPT if #3 comes to fruition. I do not want this to happen, but I also believe it is wise to look at all reasonable scenarios. We all know the history of SRPT.
In essence, my point is very simple: PLAY THE STOCK WISELY.
Thumbs up if you're tired of halt posting incessantly on this topic and think it adds nothing to the discussion surrounding SRPT.
Dude, did the Clintons rape your dog? Get over it. You seem mentally ill at this point.
People need to let go of their hate. I'm not suggesting they should start slobbing PPMD's #$%$, but how about trying to mend fences instead? This letter is a good start.
I don't think anyone wants to apologize. Because nobody really cares when you buy and sell. Imagine what the board would look like if everybody posted their buys and sells. Go ahead, imagine it. Then maybe you'll figure out why NO ONE CARES.
Twitter is a much better forum for posting buys and sells.
The problem with this theory is that there is clearly a big sector rotation going on. Biotech is greatly risk off at this point, and P/Es in the sector are being redefined. Tough to say where they will settle. Point being, in the current environment, you can't use past price as an indicator of where the stock should be or will be. (In other words, bargains can become much bigger bargains.
I think that longterm there is nothing to worry about with SRPT, but short term and mid term could be very rough, due to the biotech sector's shift to risk off. Based on options activity in major biotech ETFs and the fact that biotech hasn't partaken in the market's major move the past 10 days, there's a very good chance that the sector beatdown could continue through the rest of 2015. Hope I'm wrong, but I'd rather exercise caution than throw money at biotechs right now. We've become so accustomed to it at sell-offs, but eventually that stops working. I'm still holding my current SRPT, but not adding any biotechs (including SRPT) until the sector finds footing. Just saying...
Hey dumdum, the CFO should probably be given a raise instead. He had the foresight to realize the FDA was likely going to push back the Adcom, so he raised right away before that happened. If you don't think yesterday's news would have tanked the stock regardless, then you're high. The CFO has pretty amazing timing. Use your brain.
SRPT investors get too emotional sometimes. I guess it makes sense after everything that's happened with this stock, but I find it's best to just block the noise.
I doubt AF is a hedge fund shill. I think he likes to the stir the pot, and shorts just happen to take advantage of any perceived negative sentiment that they can, whether it's an AF article or BMRN's CEO taking a jab at eteplirsen. (I would also add that I think AF probably dislikes the cult-like mentality of many SRPT investors, which is why he is more prone to stir the pot here.)
SRPT is incorporated in Delaware. Hostile takeovers are pretty tough if the sought-after company is incorporated in Delaware. Wasn't a coincidence that SRPT incorporated there.
My gawd. What a joke of a report. To actually suggest that eteplirsen has no clinical effect is laughable.
I think folks who've primarily invested in biotech for the past 6 years need to be a little more objective, and this relates to SRPT as well. I see so many people on Twitter (and here on the board) talking about all of the great deals in biotech. They've been so accustomed to buying the dip that they're failing to realize just how immensely damaged the biotech market is right now. In reality, are things so bad? Probably not. But reality doesn't matter much in the market. Sentiment does, and big money has been unloading their biotechs left and right. It is a risk off sector now and probably for awhile.
Think about it. What triggered the drop in the first place? The drug pricing issue. With the political debates still at their infancy for this next presidential run, do you really think that issue is going to go away anytime soon and do you really think it will suddenly stop having an effect on the biotech market? Be careful of buying "good deals." If you're sitting on piles of cash and don't mind waiting it out longterm, by all means, have at it, but those falling knives that you're trying to catch could very well lose another 30% or more. And yes, this includes SRPT. Catalysts don't mean much when a sector is in a bear market. Just ask RLYP.
Just my two cents. There's nothing wrong with sitting on cash.
I think pearsby might be onto something in one of his more sane posts. It could be that the FDA is actually attempting to move the Adcom date up in order to approve faster. I could see this as plausible. Not necessarily likely, but plausible. If this is the case, it would certainly be a good explanation for the price action the last few days.
Uh, yeah, DUH. What did you expect them to do? Say, "We paid $700 million for Prosensa because we think drisapersen is a junk drug."
Expressing confidence and having a legit reason to be confident are two very different things. If BMRN were that confident in drisapersen, they wouldn't take every chance they get to try and dog eteplirsen. Now why would they do that???
Your hedge is looking excellent.
Why does the world have to revolve around SRPT when it drops 7%? Have you noticed every other biotech out there?
Nobody is intentionally driving the price down. Funds are selling because there is a high amount of fear in the market, and biotech is clearly risk off right now, thanks in large part to the concern of pricing. It has nothing to do with SRPT in particular, and nothing to do with conspiracy theories. This is just how the market cycles. That simple.