The biotechnology and drug manufacturing market continues to give investors a hit-and-miss.
Bears are betting heavily against Hims and Hers (HIMS), holding a short interest of 28.31%. On May 21, Hims said that it would launch a generic version of Novo Nordisk’s (NVO) obesity drug, semaglutide, in Canada. The drug will cost as low as CAD 149 a month.
Novo lost market exclusivity for the drug in January. Generic drug firms like Teva (TEVA) will benefit. TEVA stock indicated a “double top” bearish pattern at over $36. Still, the stock is up by 127% from its 52-week low at $34.07.
Regeneron (REGN) shares trended in the $750 - $800 this year, only to break down. It closed at $638.88 last week in reaction to a late-stage trial setback. Regeneron said that Libtayo, an immunotherapy, did not meet the primary endpoint. The drug, which treats melanoma (a skin cancer), involved over 1,500 subjects. Shareholders will need to rely on a Phase 3 trial that evaluates fianlimab plus cemiplimab. Those drugs treat metastatic melanoma.
The market is overreacting to the results. Regeneron might need to rethink the doses, along with a comparison to an established drug like Merck’s (MRK) Keytruda. Similarly, the Phase 3 trial is in comparison to the treatment provided by Bristol Myers (BMY).
Investors should add REGN stock to the watch list.
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