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  • Writer's pictureJohn Q Leonard

Biotech Stock Option Picks

Updated: Mar 9, 2020


Happy Friday! I hope today's post might provide some value to you and some fun food for thought. Enjoy the read, and have a safe and wonderful weekend.

Disclaimer: I am not an investment guru; nor do I have any license to give any investment advice, and the following should be taken in that context. Please don't take any of these statements as investment advice. Other factors must be taken into consideration when making any important investment decision.

Here, I present 2 biotechnology companies with high growth potential in the short term (1-2 weeks). My strategy is to buy call options with mid-June expiration.* Options limit my downside risk and take advantage of the binary nature of new data announcements and scheduled FDA decision time points.

Incyte Corporation (INCY) Baricitinib scheduled to get final approval in the next 3-4 weeks for Rheumatoid arthritis (refiled with the FDA in collaboration w/ Eli Lilly). The FDA has some concerns about the safety profile at the higher 4mg dose, but the FDA panel will evaluate each dose separately, and they seem satisfied with the 2mg data, although there will compete against Pfizer's fast-growing JAK inhibitor Xeljanz (tofacitinib). This article suggests they will “squeak by” on safety: https://www.fiercebiotech.com/biotech/fda-conflicted-lilly-and-incyte-s-refiled-baricitinib.

Argenix (ARGX) - ARGX-113, or Efgartigimod is a first-in-class antibody fragment designed for the treatment of patients with severe autoimmune diseases associated with high levels of pathogenic immunoglobulin G, or IgG, antibodies for which few innovative biologic treatments have been approved and severe unmet medical need exists. Efgartigimod has been created to degrade circulating disease-causing autoimmune antibodies and has potential in many large and orphan indications: multiple sclerosis, immune thrombocytopenia, systemic lupus erythematosus, myasthenia gravis and skin blistering diseases. Phase 2 data for a Myasthenia gravis (MG) trial was initially released on December 11, 2017 - 75% of patients showed meaningful improvement. Full data to be reported at American Academy of Neurology conference (April 24, 2018). Phase 3 trial to be initiated in 2018. Phase 1b/2a abstract to be presented at AAN Meeting April 27, 2018.

*When dealing with options, I like to do certain things to offset risk. Here, I bough a put option on Redhat (RHT) to offset systemic risk in the market. I plan to be in these options for 3-4 weeks.

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