Neurocrine Biosciences, Inc. (NBIX)

The recent mixed results for the 702 study have created a green thumb opportunity in CAPS, although I would hesitate to buy shares in a sketchy outfit like Neurocrine with real money. In this study, also known as Lilac PETAL (barf), several different outcome measurements were used which virtually guaranteed mixed results. Of course in Neurocrine's PR they dismissed all the non-significant outcomes as irrelevant and wholeheartedly embraced the significant results. If anyone believes they wouldn't have done the exact opposite had the outcomes been reversed, I have a cure for melanoma that I'd like to sell you. On the other hand, Intermune stock actually went up after much more foreboding mixed results in a late stage trial.

Why did Neurocrine take it on the chin? Possibly because of their history of misleading investors on the cruddy sleep drug Indiplon. Not much trust left. But I think a larger reason was the heading of an article that came out from thestreet.com shortly after trading began that day - Neurocrine's Elagolix Misses Main Study Goal. The article itself, by Adam Feuerstein, was far more even-handed than the heading. But Feuerstein has become much more influential than companies and insitutions are willing to admit. If anyone doubts, take a look back and see how he hastened Introgen into their well-deserved coffin.

I respect AF a lot, and consider him one of the best sources for opinionated biotech market research. And as he has pointed out, his editors write the headings. But it's very interesting to see how a choice of words can have such a strong short-term effect on share price. My prediction is that Neurocrine will continue on track as though the trial was a success, pending data from the four arm leuprolide comparator trial in Q3. The share price will return to an equilibrium and I will again move to the sidelines before the next binary catalyst. I'm planning to hold on to my Neurocrine score leader position.