Monday’s Markets ‘Hungover’ After Strong Weekly Advance – $ARNA $INVO $NUE $PFE Rise

Published Dec 13, 2021

By John F. Heerdink, Jr.

“The secret of getting ahead is getting started.” – Mark Twain

Monday’s markets felt a lot like a relatively bad, but somewhat expected hangover, after an amazing week of partying or in last week’s case, a rush up in market value. Indeed we started and ended in the red today as 7 of the 11 sectors closed lower. The four leaders were the real estate sector up +1.3%, the utilities & the consumer staples sectors up 1.2%, & the health care sector up .9%. A bevy of growth concerns plagued investors minds again today on the back drop of the recent run up including the reported inflation numbers, the Fed’s lingering interest rate or increased pace of tapering due out on Wednesday & the reportedly growing Omicron cases in the USA, UK and to some degree from around the world weighed heavily on the markets. We did not receive any macroeconomic reports today, but tomorrow the Producer Price Index (PPI) report for November & the NFIB Small Business Optimism Index report for November will surface. Along with the aforementioned host of concerns that seemed to point towards lower growth, the yield curve also moved lower & slightly flattened as the 2-yr yield closed down 2 basis points at .64% & the 10-yr yield fell 7 basis points to 1.42%. The US debt picture took a back seat in the press today, but it is also floating around out there and needs to be addressed this week in some way. Gold prices rose $3 to closes at $1,787/oz. & silver closed at $22.31, +.13. Bitcoin (BTC) closed at $46,710.49, -6.62%.

On the bright side of the markets, we possibly got a good sign in the form of M&A surfacing in the beaten down biotech sector. Pfizer (PFE, $55.20, +4.59%) announced that it is acquiring Arena Pharmaceuticals (ARNA, $90.08, +80.38%), a transaction valued at $100 per Arena share in cash, for a total equity value of approximately $6.7 billion. This proposed acquisition is believed to offer potentially new, differentiated best-in-class approach to address unmet need for a broader number of patients with immuno-inflammatory diseases, while expanding an innovative pipeline potentially that could enhance growth through 2025 and beyond. The SPDR S&P Biotech ETF (XBI), a barometer of the smaller biotech stocks, closed at 110.80,+ .81%.

In turn, the major indices closed lower as follows: the S&P 500 closed at 4,668.97 (-.91%), the Dow 30 closed at 35,550.95 (-.89%), & the Nasdaq closed at 15,413.28 (-1.39%). The small caps on the Russell also took a sizable hit and closed at 2,180.50 (-1.42%), while the micro caps moved down in virtual lock step as the iShares Micro-Cap ETF (IWC) closed at $136.06, -1.57% as liquidity dried up.

VP WATCHLIST

Apple (AAPL) closed at $175.74, -.2.07%. Tesla (TSLA) closed at $966.41, -4.98% well off its all time and recent high of $1,243.49 as Ford closed at $20.43, -4.76%), Rivian (RIVN) jumped 3.7% & Lucid Group (LCID) rose 4% after being included in the NASDAQ 100. The Walt Disney Company (DIS) closed at $150.43, -1.49% and is valued at $277.993B. Today, Cox Communications added Disney Plus to its lineup of next-gen TV services.

On the small side, Atossa Therapeutics (ATOS), a clinical-stage biopharmaceutical company seeking to develop innovative proprietary medicines in oncology and infectious disease with a current focus on breast cancer and COVID-19, rose to an intraday high of $2.07 prior to closing at $1.97, -1.99% on 3.04M shares of trading volume. Atossa management recently held a “A Town Hall Q&A Event With Atossa Therapeutics Management Team” via Tribe Public. You can view it clicking here. Atossa also announced last week that it had completed a pre-investigational new drug (PIND) meeting with the FDA to obtain input from the FDA on pre-clinical, clinical, manufacturing and regulatory matters in the U.S. for Atossa’s proprietary Z-endoxifen to treat breast cancer in the neoadjuvant (prior to surgery) setting.

Fate Therapeutics, Inc. (NASDAQ: FATE), a clinical-stage biopharmaceutical company dedicated to the development of programmed cellular immunotherapies for patients with cancer, today showcased positive interim Phase 1 data from the Company’s FT596 program for patients with relapsed / refractory B-cell lymphoma (BCL) at the 63rd American Society of Hematology (ASH) Annual Meeting and Exposition. FT596 is the Company’s off-the-shelf, multi-antigen targeted, iPSC-derived natural killer (NK) cell product candidate derived from a clonal master induced pluripotent stem cell (iPSC) line engineered with three anti-tumor functional modalities: a proprietary chimeric antigen receptor (CAR) optimized for NK cell biology that targets B-cell antigen CD19; a novel high-affinity, non-cleavable CD16 (hnCD16) Fc receptor that has been modified to prevent its down-regulation and to enhance its binding to tumor-targeting antibodies; and an IL-15 receptor fusion (IL-15RF) that augments NK cell activity. “The interim dose-escalation clinical data from our FT596 program in relapsed / refractory B-cell lymphoma demonstrate that off-the-shelf, iPSC-derived CAR NK cells can bring substantial therapeutic benefit to heavily pre-treated patients in urgent need of therapy, with high response rates and meaningful duration of responses,” said Scott Wolchko, President and Chief Executive Officer of Fate Therapeutics. “We are particularly pleased with the therapeutic profile that has emerged with FT596 in combination with rituximab, where over half of the patients treated with a single dose of FT596 at higher dose levels achieved a complete response with a favorable safety profile that is clearly differentiated from CAR T-cell therapy. We look forward to assessing a two-dose treatment schedule for FT596 to further define its potential best-in-class therapeutic profile and ability to reach more patients, including those earlier in care.” Shares of FATE closed at $48.98, -.37% , but have rallied in the after markets to $51.50, +5.14%.

InMed Pharmaceuticals Inc. (NASDAQ: INM), a leader in the development, manufacturing and commercialization of rare cannabinoids, closed at $1.43, -4.67% after hitting an intraday high of $1.53. Eric A. Adams, InMed President & CEO stated recently, “The first quarter of fiscal 2022 saw positive momentum across all of our programs. With the completion of the BayMedica Inc. (“BayMedica”) acquisition, our integrated teams are working together to identify rare cannabinoids in BayMedica’s pipeline for commercialization in the consumer health and wellness industry. For the duration of fiscal year 2022, we will be focused on growing revenues through the launch of these selected rare cannabinoids, in addition to expanding sales of BayMedica’s Prodiol® CBC (cannabichromene) and progressing our existing programs.”

INmune Bio, Inc. (NASDAQ: INMB), a clinical-stage immunology company focused on developing treatments that harness the patient’s innate immune system to fight disease, today announced data to be presented at the San Antonio Breast Cancer Symposium showing mucin 4 (MUC4) expression predicts worse survival and is a treatment resistance factor in women with triple negative breast cancer (TNBC). INB03, a DN-TNF therapy, can reverse TNBC treatment resistance by decreasing expression of MUC4 and reducing immunosuppression in the tumor microenvironment (TME) by increasing anti-tumor macrophage phagocytosis and increasing lymphocyte function in the TME. The poster will be presented by Dr. Roxana Schillaci, Instituto de Biología y Medicina Experimental, Buenos Aires, on December 10th. RJ. Tesi, M.D, Chief Executive Officer of INmune Bio, commented, “We are excited to have Dr. Schillaci present these data that expand on her previous findings on the role of MUC4 expression which predicts worse survival and resistance to therapy in HER2+ breast cancer therapy. Now, in both TNBC and HER2+ breast cancer, MUC4 predicts resistance to immunotherapy and an immunosuppressive TME that can be overcome with INB03.” Treatment with INB03 in murine models of breast cancer improves macrophage anti-tumor phagocytic activity, lymphocyte infiltration and function suggesting improved response to combination therapies of INB03 with inmunotherapy. Shares of INMB closed trading today at $11.35, -5.97%.

Shares of INVO Bioscience, Inc. (NASDAQ: INVO), a medical device company focused on commercializing the world’s only in vivo culture system (IVC), INVOcell®, closed at $3.40, +.89%. INVO announced recently that the Company has received approval by Medical Devices Control Division for FDA Thailand to import and commercialize INVOcell in Thailand. In April 2021, INVO Bioscience entered an exclusive distribution agreement with IVF Envimed Company Ltd. to distribute the INVOcell system within Thailand. Established in 1993, IVF Envimed Company Ltd. has established a wide network of clinics and hospitals across Thailand primarily focused on fertility solutions. IVF Envimed is a member of the ‘Thai Society of Reproductive Medicine’ which organizes congresses and educational programs where IVF Envimed participates. Shares of INVO closed at the high of the day at $3.25., +1.56%. Recently, Steve Shum CEO of INVO stated, “We continue to execute against our core mission of improving access to advanced fertility services for the many patients around the world through the use of the INVOcell solution. During the quarter, we achieved a significant milestone with the opening of our very first INVO Center, based in Birmingham, where we have commenced initial cycles. Further, we opened clinics in Atlanta, Georgia and Monterrey, Mexico to expand the INVO Center business model and we are working to open the San Francisco Bay Area clinic as soon as possible. We completed the acquisition of a Canadian-based entity that will be used to distribute the INVOcell in Canada and to develop INVO Centers in the region. With our INVO Center strategy now successfully underway, we are optimistic on the prospects for further expansion using this unique and innovative model. As part of a detailed review, we have initially identified more than 20 cities here in the U.S. that we believe have excellent characteristics in terms of demographics and level of current fertility care that would be ideal locations for an INVO Center. As an important development to our ability to expand the INVO Center model, we will regain full U.S. commercialization rights to INVOcell® from Ferring in early 2022, which removes certain limitations we had on expanding this business model in the U.S. Further, it allows us to resume direct sales to IVF clinics in our home territory and further expand our channel development plan. With our strong team of leaders highly experienced in commercializing advanced reproductive technologies, we are optimistic about our prospects as we pursue our multi-channel market expansion strategy. In addition to the opening of our INVO Center in Monterrey, Mexico, we continue to advance our international commercialization plans. Clinical validation of INVOcell® continues to grow with four poster abstracts presented at ASRM this year. We are excited about the recent developments to advance commercialization of the INVOcell® solution. We look forward to leveraging the recent success of our INVO Centers, particularly in the U.S. With a great team, board of directors, and key advisors in place, we believe we have laid a strong foundation to achieve our goal of democratizing advanced fertility treatment with the INVOCell® solution, which should lead to strong revenue growth going forward.”

Shares of NeuBase Therapeutics (NASDAQ: NBSE) a biotechnology platform company Drugging the Genome™ to address disease at the base level using a new class of precision genetic medicines, closed at $2.86, -1.72%, but has traded up to $3.39, +18.53% in the aftermarket. Dietrich A. Stephan, Ph.D., Chief Executive Officer of NeuBase, presented in person a corporate overview at the Jefferies London Healthcare Conference recently.

FURTHER AFIELD

MGM Resorts International (MGM, $40.34, -2.58%) reportedly stated that will sell the Mirage hotel and casino in Las Vegas to Hard Rock International for about $1.08B in cash.

Block Inc. (SQ, -3.24%), previously known as Square, found out that Buy now pay later firm, Afterpay Ltd, has received 99.7% arrival via the cast proxy votes for the proposed $29B buyout.

Merck (MRK), known as MSD outside the United States and Canada, today announced its inaugural issuance of a $1 billion sustainability bond, which was part of an $8 billion underwritten public offering of notes that closed on Dec. 10, 2021.

Nucor Corp. (NUE, $115.55, +2.07%) has agreed to pay more than $400M to acquire a 51% share in California Steel Industries Inc., which it will operate as a joint venture with Japan-based JFE Steel. CSI has over 800 full-time and temporary employees and five product lines. “Acquiring a majority ownership stake in California Steel Industries expands our geographic reach in sheet steel and gives us a strong presence on the West Coast,” commented Nucor CEO Leon Topalian.

Investing & Inspiration

“No matter how many goals you have achieved, you must set your sights on a higher one.” – Jessica Savitch
“Start where you are. Use what you have. Do what you can.”– Arthur Ashe
“The secret of getting ahead is getting started.” – Mark Twain