Inhibrx, Inc. (INBX)

Entertaining to watch as INBX IPO underwriters continue to keep this stock from crashing on the secondary market by using stabilizing bids. But they only have so much they can do. Will the floor drop out?

Definition:
A stabilizing bid is a purchase of stock by underwriters to stabilize or support the secondary market price of a security immediately following an initial public offering (IPO). After an IPO, the price of the newly issued shares may falter or be shaky in trading.

I've followed the research of others and did a little digging on my own. INBX does not look promising.

1) Poor financials. Huge losses of $51.4 MILLION in 2019 and $38 MILLION in only the first 6 months of 2020. INBX claims it is due to "increased R&D costs", but it turns out that they moved into a very expensive building two years ago, overlooking Torrey Pines Golf Course with ocean views. No way, as an investor, am I going to pay for those views until they have a successful drug portfolio established. INBX is spending $ as though they are Celgene or Eli Lilly already. That kind of reckless spending rarely ends well.

2) Bad track record. This company is not new. It was founded in 10 years ago. They sold a CD47 antibody to Celgene. That program was terminated relatively quickly. INBX then sold a GITR antibody to Five Prime. That program was terminated almost immediately. Neither of those companies provided an explanation as to why they terminated the deals, that I can find. I'm speculating the antibodies showed some non-specific cross-reactivity and both Celgene and Five Prime discovered this early on? Purely speculative. Maybe the TOX studies came back poor? Either way, those companies got burned by INBX, IMO. That's what happens when you don't do your due diligence.

3) A biotech founded 10 years ago with virtually no success stories (except grants and a small licensing deal to Bluebird (another poorly run company)) values itself at $119 MILLION???!!!

The only ones getting rich off this deal are the VC firms and company management. No way am I going near this one yet.

Did you see the latest update from Inhibrx? They gave a summary of clinical results on INBRX-109, an antibody against a tiny chondrosarcoma patient population. I guess they will have to charge patients hundreds of thousands of dollars per treatment to get a return for investors and more importantly make themselves rich considering the other program is exploring 'combinatorial' efficacy with Keytruda since their standalone drug is not impressive enough on its own. But the best part of all is they slipped in the fact (at the end) that Oxford Finance extended $40 million to Inhibrx as a loan. I'm sure Oxford secured extremely favorable loan terms to extend that lifeline. This begs the question "Will there be anything left over for retail investors"? Because this huge debt will certainly negatively impact profitability. This is an extremely risky company to invest in, IMO.