Hi Kathy, Yes, the NERX albatross has hung from my neck for a very long time. I'd guess it's going to be harder to show a loss from now on, however!
NERX has been one of those "top of the pyramid" stocks in my account. Never enough there to really hurt anything but my ego, and always enough potential that it kept me intrigued. Certainly from a Fundamental point of view, there's hardly a single biotech that would qualify as anything but pure speculation since most don't make any money, or even have a product for sale!
However the lure of a home run hit has kept me invested in both the common and the preferred. The Preferred has paid the rent while the common was used to trade with AIM. Until the last few months, most of the AIM trades have been Buys, however. I'd have to look but I think this rollercoaster ride started with the common at about $12. I think my cheapest shares were purchased at $1.50. Nice range, don't you think?
So, it wasn't that there weren't other stocks that might have done better, but the desire to see it through to its end. NERX has kept with the same strategy for targeting certain types of cancers and has now started to show positive results. The next round of tests (Phase III) will be the most telling. The concept of low total dosage radiation chemotherapy that targets just the cancer cells is a powerful one. They are still a long way from selling product, however.
Of the dollars that I've spent on biotechnology, NeoRx's have been the hardest to make pay, even with AIM's help. In each case, until just very recent times most have been dogs and cats in my portfolio. Of the few that I own, Chiron has been profitable the longest and is the only one with a substantial portfolio of products that sell on the open market. It's also been a profitable investment more of the time than any of the others.
On the other hand, CHIR is showing only "modest" returns compared to GENE at this point. I must stress that the recent returns on all of my biotech stocks hasn't come through a major improvement in the underlying fundamentals, but through a change in the perception of the whole group by investors. I'm not complaining as I had plenty of "inventory" to sell as the prices have been rising. They, as a group have gone from being the "leanest" relative to Cash Reserve to being fully funded with cash.
Is there substance to the biotechs in general? Yes, there's real products and profits in the overall group. But the majority of them don't make a dime or have anything to sell yet. Of the ones I own, Chiron has the most product and profit, Cohesion next, Genome doesn't have profit, but is selling "product", Biopure has product but is still in its infancy and finally NeoRx which has no products as of yet for the open market.
Having patience and keeping these stocks in perspective relative to the overall portfolio has allowed me to stay with them. Deep pockets hasn't hurt! As we know, AIM will continue to buy as long as the prices fall. The biotechs have offered many opportunities over the last 10 years to exhaust people's Cash Reserves as well as patience! Finally in a very short period of time they've made me look smart.
But until the last few months, these weren't stock I even liked to mention here on the BB as I was afraid my comments might be misinterpreted. Only two of the biotech stocks I own belong anywhere but at the very top of one's investment pyramid from a fundamental point of view. Since I've never been to Las Vegas, I guess we could consider these investments "Vegas" money - something I could afford to lose on a long shot.
Best regards, Tom
PS: speaking of Vegas, do you think you might be able to make the trip?
PPS: Wouldn't Sully be proud of me? |
