Actions speak louder than words, as the saying goes. And when it comes to insiders, that certainly seems to be the case. If we track informative insider buy transactions, we can get a good idea of the stocks that insiders see as compelling investing opportunities right now. This matters because insiders have access to a wealth of company information and insights. Here we use TipRanks’ Daily Insider Transactions to dive into some of the latest big insider spending. You can filter the options to delve into a specific sector, and limit the results to only transactions from top-performing corporate insiders. Here we screened for biotech stocks with transactions of over $50,000.
Let’s take a closer look at the results now:
KALA
Kala Pharmaceuticals (KALA) develops drugs using its special mucus-penetrating particle (MPP) technology. This includes INVELTYS – a cutting edge drug designed to treat post-operative inflammation and pain following eye surgeries.
“INVELTYS is the first and only FDA-approved corticosteroid eye drop with a BID dosing regimen to be used after ocular surgeries” cheers HC Wainwright analyst Ram Selvaraju (Track Record & Ratings). Most notably, INVELTYS is now rounding its commercial launch set for 2019.
As a result, Selvaraju ascribes an asset value of $1.1B for INVELTYS- and this drives his 12-month price target of $32. Given current share levels, this indicates massive upside potential of over 320%.
He models for $200M in cash after the latest financing round, which should see KALA through both the INVELTYS launch and the STRIDE 3 trial (for dry eye disease).
Clearly insiders want a piece of the action. In the last week, two directors have each invested a further $20 million in the stock. Post-purchase, Shah Rajeev (Insider Transactions) now has a total of $35 million invested in Kala’s fortunes. This isn’t his only big holding- Rajeev has piled into multiple biotech stocks including Solid Biosciences and Ra Pharmaceuticals.
EPIZYME
Full speed ahead! Epizyme’s (EPZM) vision is to rewrite therapy for cancer and other serious diseases through targeted epigenetic medicines. This involves looking at how the expression of DNA can be changed without changing the structure of DNA itself.
And now good news: the FDA regulatory body has just lifted a partial clinical hold on Taz trials for lymphoma and certain solid tumors.
According to top HC Wainwright analyst Andrew Fein (Track Record & Ratings) this “marks the removal of a major overhang for the past a few months, and should allow EPZM to forge ahead at full speed to arrive at several value inflection points in the months ahead.”
He sees multiple catalysts in the near-term including the full data release for the epithelioid sarcoma (ES) program at ESMO this October, followed by a pre-NDA meeting to support the planned NDA submission in 1H19. Fein sees shares spiking 177% to $25.
So it’s not surprising that five-star director David Mott (Insider Transactions) has just snapped up shares worth almost $4 million- bringing his total EPZM holding to a sizable $62 million.
AMICUS
Amicus (FOLD) is buzzing right now. The biotech has just announced a definitive agreement to acquire Celenex for $100M in upfront cash (plus up to $75M in sales milestones). Per the deal, Amicus will now get its hands on Celedex’s platform of 10 gene therapy programs.
Top 100 Cowen & Co anlayst Ritu Baral (Track Record & Ratings) gives the deal her seal of approval. “The technology has been validated in other orphan CNS disorders, and preclinical data looks encouraging and consistent” the analyst writes.
She adds: “Lead programs are in the clinic for CLN6 and CLN3. CLN6. 2-yr results in 2 CLN6 pts look very strong (more data in 2019).” Baral has a $31 price target on the stock (130% upside potential).
And as we can see below, top insider Perceptive Advisors (Insider Transactions) just invested a further $630,000 in the stock. In fact in the last three months Perceptive Advisors has spent no less than $8.43 million on Amicus. It now owns a whopping $278.5 million in the company- just one of its total $3 billion insider holdings.
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