Ok
I’m in at $55
This seems ridiculous
What is interesting is that despite this, even with the added N2 patients to the N1 patients, and the resultant downward apparent overall response rate, the responses in N1+N2 are statistically significant over historical treatments. The phase I/II trials are essentially concluded for first line renal cell, first line melanoma, and cis-platinin ineligible bladder cancer. They have the data they need to advance to phase 3 clinical trial for each of the indications, and are enrolling those trials presently.
This corroborates the information that 9 patients were no evaluated. The trial efficacy endpoint was met so there was no need to evaluate further patients. The statistics would have probably been even better had these additional patients been evaluated. The drug could advance to Phase III without considering these 9 patients.
Chris
1 Like
Thanks Jack - I’ve been informing myself on Nektar for some time on this board, and with the combined information and articles over the weekend, and your clear evaluation this morning, I took the plunge and bought a full tranche at 54.50. I figure on such a big drop based on mispricing, the 3-day rule doesn’t apply. You just need a couple of talking heads to explain publicly the misunderstanding, and the buying opportunity could go from crazy to just very good.
4 Likes
Jack-
Thank you for your insight, and welcome to Montana!
Jimbo
Well Jack, I had said I added earlier, and wouldn’t add any more, but when you posted as a knowledgeable person and had confirmed what I had (much less knowledgeably) posted earlier:
In my naive opinion, this is ridiculous, and simply a misunderstanding of what they reported. If the patients improve gradually over months, of course when you add new patients the overall response rate drops when you add in those patients who have just started on treatment…duh!
well I decided to add more in spite of having all I had thought I wanted, so I added a rather large bunch at $54.70.
Thanks again for your help,
Saul
10 Likes
3-day rule! Enter slowly, boys and girls. Save some powder for Wednesday-Thursday.
KC
Agreed. Never add on the day of the huge news drop, always wait at least until day 2. Sure, maybe it opens $2 higher the next day but you’ll save yourself the additional $15 drop more often than not as we’re seeing today.
6 Likes
Aside from this, a few normal factors are probably driving the price down artificially: margin calls
False, margin desks won’t even be making these calls until around 1-2pm or later unless you’re talking about execs or someone with a massive, massive block of shares.
Good clients are normally given until 3pm to make good before being forced out of their position by the margin clerks.
Naj,
sat next to the margin desk for a couple of years at a Very Big Bank.
10 Likes
Thank you Saul and Jack for following this stock and exposing this move as a potential buy opportunity. I’ve been following this stock for about 6 months now and knew this board had followed it closely. After I saw the big drop today I checked this board out and sold EDIT and ALGN, my two smallest positions, and bought NKTR. I didn’t want to sell these stocks as they are full of promise, it couldn’t pass this up.
1 Like
More at $55.90 for me
As of this morning, I built a 5%+ position in NKTR around $53 (including some long-term options).
As a non-medical expert, I’ve been absolutely enthralled with the company and prospects for the last 12 months. What potential to significantly better the world!
However, from a strictly price action standpoint (TA), parabolic moves by companies without significant cash flow / revenue / earnings (for lack of a better term, “story stocks”), are mostly followed by swift regressions downwards. And NKTR had been significantly overbought from late 2017 to early 2018. Hence, I’ve been waiting for an entry point, and today, on semi-positive / neutral news the bottom fell out.
From a technical perspective, there may still be room left to fall (low $30’s as an absolute bottom), but I couldn’t pass up the opportunity to get involved in the potential upside at <$8B EV. I will purchase more if it falls into the $40’s, but we have very quickly entered over-sold conditions.
Good luck to all. And for humanity, I hope NKTR wildly succeeds!
Stephen
2 Likes
I’m in too. I have been watching this one since you first mentioned it, and I am impressed with everything so far. May it turn out as good as it seems from the trials for everyone.
1 Like
Jack:
THANK YOU! As a former biotech finance executive at several companies in the Bay Area who only understands the bigger picture and does not have as firm a grasp on the details and Science, I rely on PhD’s like you to dumb it down and synthesize it for me. Your education and expertise in the field and this concise interpretation of the results is greatly appreciated and corresponds with my more limited review of the ASCO presentation, as well as those of a few other Biotech friend’s opinions I respect.
I added a little to my position this morning around $53/share and plan to maintain my current 4% position of my total portfolio. That is a lot for me to have in a company with no revenues or proven products, but I consider NKTR a relative exception with deep pockets (very large cash position), cutting edge science and solid partnerships. The next 12 months will prove very interesting. Thanks again!
Victor
6 Likes
Etrade has always given me two to three days for a margin call. Been a long while, but enough time to wire money w no problem. Don’t know if that is still their policy.
Tinker
These N2 patients are the interpretative problem as their mean time on trial is 4-5 months and thus they are skewing the response data downward as they have just not been on trial long enough (they look like the N1 patients back in November).
That’s all well and good, but NKTR set the criteria and yet failed to communicate the result as you have attempted to do here. Still worrisome.
🆁🅶🅱
6 Likes
In for a penny, in for a pound - tossed another chip on the table and increased number of shares by another 67% at $56 even.
Seems more reason to think of the results as non-catastrophic than catastrophic to the company.
We’ll see,
Jeff
1 Like
That’s all well and good, but NKTR set the criteria and yet failed to communicate the result as you have attempted to do here. Still worrisome.
I have to disagree. They presented scientific results, which are by their nature complex. Moreover, for scientific and legal reasons, they probably have to be more strict with their language than we can be on this board. For what it’s worth, they did communicate that the results were positive. That is clear in all of their summary language and the continuation to phase 3 trials. If investors interpreted that as negative, then that is on them.
It is not the job of the company to babysit the anxieties of individual investors. A particular analyst got this wrong (who knows why) and the market got a case of the jitters. How is that NKTR’s fault?
I have no worries about this. In fact, I am happy that I got to buy more at a better entry price.
-lemur
6 Likes
They presented scientific results, which are by their nature complex
that does not require them to present it in a complex, or frankly awful, way. Did you even look at their slide deck? Its an utter eye sore, moreso than usual pharma slide decks.
How is that NKTR’s fault?
Well, it was their presentation… Having a higher share price is beneficial for them when they need to raise additional funds, negotiate a buy out, etc. I do not think many publicly traded biotechs are going, “oh good, our share price fell 40% today!”
If the data was so great, then they should have done a better job explaining it.
¯_(?)_/¯
28 Likes
The share price did not fall 40%+ due to small time investors panicking. It was institutions that sold and they sold very hard, and the small time investors followed suit.
The actual end point for 214 is to be determined in the future. The numbers they used were quite tiny to begin with in regards to number of patience. They will have plenty of time to give each patient time to respond in Phase 3, and I am sure there will be updates on the numbers when the data matures again on the additional patients.
But no one is missing the fact that this drug does better as time drags on. That is being taken into account. What they are looking at is the competitive environment that 214 has to sell into if approved. They want front line (at least in the future, if not outright at the beginning). Not second to third line treatment. The difference in value is stark, in the billions and billions of dollars. Thus the forward looking valuation, off the back of napkins for many, had to go way down.
Did they overshoot? Probably. On the New Paradigm board I wrote about the almost universal pattern fo successful biotechs. KITE was an exception to the rule by JUNO followed it. The stage we are in now is the Martha Stewart stage where usually someone goes to jail (that won’t happen here, but it feels like someone should). This has happened to practically every successful biotech I ever invested in. And fortunately I usually did not invest in them until the company reached this stage of clinical development (although I got stuck in EXEL just before this).
The next stage, after panic, illegal insider selling, arrests etc. (Martha Stewart stage - and again the criminal element won’t happen here but I use if for effect) is that o average, say 18 months, the stock will make a remarkable comeback and may even be multiples higher than from where it fell.
However, given how high NKTR was before it fell, I do not know if the multiples higher will hold here, but the same general thing will happen in this stage.
This is the time that tests your fortitude, like no other in investing. Easy for me to say because I do not own any (my 2 day trial period convinced me I do not need biotechs in my life at this point in my life, so got rid of it and bought more NVDA and ANET at the time), but it is also the time to take a very deep dive into the company, and for those who have been waiting for the Martha Stewart stage to hit, see if they really do want to dive in big time and then go in hybernation as the nearly inevitable recovery stage slowly rolls out.
Tinker
23 Likes
Don’t recall if Merk’s PD-1 inhibitor been discussed on Saul’s board as a competitor to NKTR-214. Does anyone on this board with expertise in bio-tech have a perspective on this TMF author’s remarks in his article titled:
“Is Nektar Therapeutics Stock a Bargain Now?
A highly anticipated presentation left investors with more questions than answers. Is the stock a bad-news buy?”
“…Even if the combo (of NKTR-214 and Opdivo) can produce a long-term survival benefit, it’s going to be hard to beat the results that Merck & Co.'s PD-1 inhibitor recently provided. Adding Merck’s Keytruda to standard chemotherapy reduced the risk of death by 51% for newly diagnosed patients with advanced-stage lung cancer.”
https://www.fool.com/investing/2018/06/04/is-nektar-therapeu…
sjo
9 Likes
Although the circumstances are completely different… except being biotech… I’m reminded of “the good 'ol days” when I lost 1/3 of my portfolio in just a few minutes after a less-stellar-than-expected response from the FDA for a drug from DNDN.
It was enough to make me raise my eyebrows. 
Didn’t get worked up because I figured I could earn it back easily enough.
Since that time, I’ve been less… enthusiastic… regarding biotech “investments”. In quotes because there is typically an unusually high degree of gambling in the overall thesis.
Interesting times. 
Rob
Rule Breaker / Market Pass Home Fool & STMP/MTH Maintenance Coverage Fool
He is no fool who gives what he cannot keep to gain what he cannot lose.
7 Likes