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portefeuille (98.85)




November 22, 2011 – Comments (1)

It might be a good idea to buy a few YMI shares today. It is currently at around 1.21 USD.


There are currently 17000 YMI shares in my "fund" (see here) with break-even of around 1.09 USD.


a recent "pitch" by zzlangerhans.


There's a move in baby biotech that I call the Sandbag, in honor of the original Indiana Jones movie Raiders of the Lost Ark. In the opening scene, Indiana braves numerous booby traps to reach his goal, the golden head of an Aztec god. Indy knows that removing the head from the pedestal will trigger the collapse of the temple so he has brought a bag of sand with him that approximates the weight of the head. He deftly knocks the head off the pedestal with the bag and leaves the bag in its place. For a moment he thinks he has succeeded in fooling the weight detection system, but then the pedestal starts to sink into the ground and all hell breaks loose.

As you might have guessed, the baby biotech Sandbag occurs when a company bumps a failing lead drug out of their PR statements and replaces it at the top with a new compound. The goal is to cushion or totally avoid the plunging share price that would be precipitated by abandoning the lead program by diverting investors' focus to a new area. If done poorly, the stock may collapse into the pennies like an Aztec temple (see CytRx, Adventrx). On the other hand, companies like Synta and Neurocrine have been much more successful with the move.

After reading YMI's most recent earnings PR, I saw that they've completed the Sandbag maneuver they began about a year ago. The body of the statement features pipeline newcomer CYT387 prominently while former lead compound nimotuzumab has been relegated to the "About YMI" postscript, despite several late stage trials still in progress. Right now, YMI's pedestal seems to be quivering ominously.

I've learned not to count out a biotech because of the messy failure of a lead compound, so I'm keeping an open mind about CYT387. The drug was responsible for elevating the share price over 3.5 after the company reported encouraging response rates in myelofibrosis at ASCO, and the effects compare favorably to Incyte's ruxolitinib which was just approved for the same indication. Updated data from the ongoing phase II trial will be presented at ASH in early December, and strong results could have a very dramatic effect at the current depressed share price. YMI is looking like a potential real buy later this month as long as the world's economic cheese doesn't completely fall off its cracker. 


(from here)

1 Comments – Post Your Own

#1) On November 22, 2011 at 1:37 PM, portefeuille (98.85) wrote:

There are currently 17000 YMI shares in my "fund" (see here) with break-even of around 1.09 USD.

now 23000 YMI shares in the fund with break-even of around 0.95 USD (see here).

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