Rayno BioBeat #5: XBI Breaks Through on a Strong Week for Biotech

Biotech Stocks Break Through to 2017 Highs in a Broad Rally

NASDAQ up 066%, IBB up 0.92%, XBI up 0.8%

The XBI is up 3.17% this week, 46% YTD, compared to only 1.1% WTD for the IBB. The breakthrough gains for the XBI can be attributed to strong performance of top ten holdings that are primarily mid-caps and M&A prospects: ALNY, BLUE, BMRN, CLVS, JUNO, PBYI, SRPT,  etc. The biotech breakthrough continued today with a “green screen” across the board including small caps. The large cap IBB is a slight laggard. Lets’ take a look at the Rayno Biopharmaceutical Portfolio performance this week and September:

  • Abbvie (ABBV) had a good day yesterday moving up to the $90 level, a YTD high, on news of an Agreement with Amgen (AMGN) that settled a patent dispute and gave a Non-Exclusive to Amgen for Humira effective January 2023.
  • Bristol-Myers Squibb (BMY) is at new YTD highs in a two month uptrend recovering from its clinical news sell-off and with deal talk ahead.
  • bluebird bio (BLUE) soared on news Thursday of a Phase 1 CAR-T study for Relapsed/Refractory multiple myeloma and that Celgene (CELG) exercised its licensing option. However the stock sold off today to $137.
  • Foundation Medicine (FMI) was up 5% for the week approaching a multiple top. Roche (RHHBY) owns equity in the Company and has R&D collaborations. Sep 26 was a Class Action deadline but so far little impact on the stock.

Biotech stocks have been trading near the top for most of September so we need to test the new 2017 highs. We remain bullish on our portfolio for Q4 and may rebalance the Rayno Life Science Portfolio after Q3 earnings.

Big 3%+ upside movers today: AVXS, CLLS, EDIT, EPZM, FPRX, GBT,INCY, TSRO, XLRN

In other news PTC Therapeutics (PTCT) soared 13 % surprising short sellers after the FDA approved the Company’s Duchenne muscular dystrophy drug despite a negative panel recommendation. This is a NEW FDA that leans toward approval (deregulation).

Disclosure long ABBV, BMY,XBI

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