I think you summed it up. Low volume drift.
While the price drifts lower, it is being accumulated in large lots. Sellers show up with 100-1000 shares to sell, and are bought by bidders looking for 5-10,000 shares. Like you, they know the potential, but also know they have the luxury of accumulating slowly at a lower price. There is no rush at this point.
News drives these kinds of stocks - biotechs still awaiting a marketable product. The pop last year to 17 clearly shows the potential here. That pop occurred when a Business Week article mentioned Biomira's huge potential. That hasn't changed. The Merrill upgrade in January wasn't based on short term expected price movement - it was based on the long term potential.
If you look at other biotechs in late stage testing, you will notice a similar pattern. Investors seem to forget about the clearly stated timeframes. They hear that a phase III trial has begun, or some mouse study "cured" cancer, and they flock like lemmings. Then they wonder why the stock doesn't move up indefinately for the next 1 or 2 or 5 years it will take for completion of the tests.
Each time we get news, the stock will move up as new investors jump on the "potential" - which was exactly the same the day before the news.
You are buying a company, not a stock. If you are in for the longterm, then you know why you chose this company.
Biomira has all the winning criteria:
Theratope:
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1 - A product with a huge market potential ($150-650 million/year)
2 - Cross applications to other cancer besides breast
3 - Cross applications as a "cancer preventative" (which has a market potential that is MORE than those with the disease)
4 - Already in final phase III testing
5 - Have a large corporate partner - Chiron
The Company:
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1 - Has enough cash (over 50 million) to complete testing
2 - Is considered a leader in the field of immunological therapies
3 - has been published in numerous prestigious scientific articles
4 - is doing everything on schedule, and is moving ahead as quickly as possible
5 - plays it "close to the chest" - a low key approach that produces only substantive and material news. This stock price is not filled with speculative "fluff".
6 - has completed final phase III trials on another product - their breast cancer diagnostics, still considered the best in the industry, and sold to Centocor.
Other products:
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1 - BLP-25 and BLP-16 - moving into Phase II now. Pre-clinicals indicate it could be the most effective immunological treatment ever discovered. 100% prevention of tumor growth, 100% effect on existing tumors (virtually eliminating them), 100% response rate. Applicable to 90% of all solid tumor cancers. They are being very quiet about this one - it's huge.
2 - Tumor specific Lipo vaccines, in collaberation with Biovector. Expected to begin human trials first half of this year.
3 - Unique IL-2 (Interluekin-2) formulation. Potential applications in both cancer and HIV treatments.
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I can wait on Biomira. News will come with results. Sometimes news just "happens" too...like that NY Times article we are all expecting to appear any day now. That could put BIOM at a $8-12 trading range awfully quick, especially leading into the May conference news. But even a move to $10 is just a tiny reflection of the potential here.
SM |
