Lately, biotechs have been heating up the market, which is why I bring to you another such company: Cell Theraputics, Inc (CTIC). On Thursday, I had mentioned to Tendo after researching some stocks that CTIC looked to be a good one to invest in, for I saw many similarities to that of GNVC. Not following up on this, I put it to the side and continued on looking for other big plays.
This morning I received a text from Tendo, telling me I was right on the money about CTIC (which at that point was up about 30% with heavy volume). I was right on the money, except for the fact that I hadn’t invested any money into it. I was sick to my stomach and frustrated for missing out on this huge jump.
But did I really miss out? Or is this jump just a warning signal? I researched CTIC again tonight and saw mixed reviews on the company, but let’s talk about them a little bit before we move on.
Cell Theraputics Inc. is a company that specializes in developing treatments for different types of cancer. Their latest drug, Pixantrone, is looking for FDA approval to treat relapsed as well as refactory non-Hodgkins lymphoma. Today they announced that the facility that has been manufacturing Pixantrone, NerPharMa (in Nerviano, Italy) has been approved by the FDA to continue manufacturing the drug product. Off of that news alone, the stock was up over 28% on the day, tripling the volume from the previous market day.
I’ve done a little research on CTIC and found an interesting report:
Cell Therapeutics offers bigger cash bonuses for 2009 while stock languishes
The article talks about how the execs in the company were offered cash bonuses despite the fact that the stock was plummeting. One could play Monday Morning Quarterback and say that this was a sign that they knew some good news was going to come out of this facility NerPharMa. However, towards the bottom of the article is something that really stuck out to me:
“Cell Therapeutics stock has been down for several weeks since FDA staff issued a critical report on pixantrone, saying it has “substantial” side effects for patients with non-Hodgkin’s lymphoma. The drug is the company’s only product candidate with a chance of winning FDA approval anytime soon. An FDA advisory panel is scheduled to recommend whether the drug should be approved on March 22, while the agency’s deadline to complete its review is April 23.”
The words “substantial side effects” don’t seem to make me feel all warm and fuzzy inside. How can a stock with that kind of news on a Friday still go up nearly 30% on a Monday, even if the facility where they’re creating the drug has been FDA approved? Despite all this, I’m considering taking a HUGE risk on this stock. Tomorrow morning (premarket), I will decide whether to buy into this company and bank on FDA approval of Pixantrone, or hold tight and just watch from the sidelines. I would have to say this would be the biggest stock risk I’ve ever taken, and could easily cost me about 50% of my investment. You’ll also have proof of me doing this since my Covestor account is attached to this blog as well. Regardless of what happens, I will look back at this entry and learn what I did right or what I did terribly wrong.
Let the games begin……..