The healthcare sector has been the top performing group in one year performance, with a 16.2% gain during that period.
Based on this observation I screened for companies in the healthcare sector where at least one insider made a buy transaction during the month of November. Here is a look at five stocks that I found.
1. Synergy (SGYP) is a biopharmaceutical company focused on the development of new drugs to treat gastrointestinal disorders and diseases. Synergy's lead proprietary drug candidate plecanatide is a synthetic analog of the human gastrointestinal [GI] hormone uroguanylin, and functions by activating the guanylate cyclase C receptor on epithelial cells of the GI tract. Synergy completed a Phase I study of plecanatide in healthy volunteers and a Phase IIa clinical trial in chronic idiopathic constipation [CIC] patients. In October, 2011, Synergy initiated dosing of patients in a major Phase IIb/III clinical trial of plecanatide to treat CIC. Plecanatide is also being developed to treat constipation-predominant irritable bowel syndrome (IBS-C), with the first trial in IBS-C patients planned for the second half of 2012. Synergy's second GC-C agonist SP-333 is in clinical development to treat inflammatory bowel diseases, and is presently in a Phase I trial in healthy volunteers.
Gabriel Cerrone purchased 87,820 shares on November 14 by Panetta Partners. Gabriel Cerrone currently controls 631,230 shares of Synergy. Gabriele Cerrone has served as Chairman of the Board of Directors since July 2008.
The company reported the third-quarter financial results on November 13 with the following highlights:
|Net loss||$9.9 million|
Gary S. Jacob, Ph.D., President and CEO of Synergy commented on November 13:
"The third quarter of 2012 has been the most productive and exciting quarter in our history. During this period, we successfully completed enrollment, totaling 951 patients, in our plecanatide Phase IIb/III clinical trial in CIC patients, and are on track to complete last visit in all patients by December 7. After that we will lock the database, analyze the data, and expect to release top-line data during the first week of January 2013. This has all been accomplished by a highly focused and dedicated Synergy team driven to provide new treatments for people suffering from GI disorders and diseases."
Synergy is currently trading with the lowest market cap among its peers.
The stock has a $2.25 price target from the Point and Figure chart. There has been one insider buy transaction and there have not been any insider sell transactions this year. There are seven analyst buy ratings, 0 neutral ratings and 0 sell ratings with a average target price of $13.20. The next major catalyst for the stock will be the plecanatide Phase IIb/III clinical trial results due in the first week of January 2013.
2. MAKO Surgical Corporation (MAKO) is a medical device company that markets its RIO Robotic-Arm Interactive Orthopedic system, joint specific applications for the knee and hip, and proprietary Restoris implants for orthopedic procedures called MAKOplasty. The RIO is a surgeon-interactive tactile surgical platform that incorporates a robotic arm and patient-specific visualization technology, which enables precise, consistently reproducible bone resection for the accurate insertion and alignment of MAKO's Restoris implants. The MAKOplasty solution incorporates technologies enabled by an intellectual property portfolio including more than 300 U.S. and foreign, owned and licensed, patents and patent applications.
- William Pruitt purchased 10,000 shares on November 15, 2,000 shares on May 30 and 3,000 shares on May 25. William Pruitt currently controls 15,000 shares of the company. William Pruitt has served as one of the company's directors since June 2008.
- Christopher Dewey purchased 25,000 shares on November 14 and currently holds 829,527 shares of the company. Christopher Dewey has served as one of the company's directors since its inception in November 2004.
- Charles Federico purchased 2,000 shares on August 3 and currently holds 12,000 shares of the company. Charles Federico has served as one of the company's directors since June 2007.
- Richard Pettingill purchased 7,775 shares on August 3. Richard Pettingill has served as one of the company's directors since August 2010.
The company reported the third-quarter financial results on November 7 with the following highlights:
|Net loss||$6.6 million|
The company's 2012 annual guidance is 42 to 48 RIO system sales and 10,200 to 10,600 expected MAKOplasty procedures.
Only Intuitive Surgical is profitable out of these four companies. Stereotaxis has the lowest P/S multiple out of these four companies.
The stock has a $9 price target from the Point and Figure chart. There have been seven insider buy transactions and 13 insider sell transactions this year. There are three analyst buy ratings, eight neutral ratings and one sell rating with a average target price of $26.71. I have a neutral bias for the stock currently.
3. Pacific Biosciences (PACB) offers the PacBio RS High Resolution Genetic Analyzer to help scientists solve genetically complex problems. Based on its novel Single Molecule, Real-Time [SMRT] technology, the company's products enable: targeted sequencing to more comprehensively characterize genetic variations; de novo genome assembly to more fully identify, annotate and decipher genomic structures; and DNA base modification identification to help characterize epigenetic regulation and DNA damage. By providing access to genetic information that was previously inaccessible, Pacific Biosciences enables scientists to increase their understanding of biological systems.
Michael Hunkapiller purchased 262,300 shares on November 14-16 and 400,000 shares on August 6-7. Michael Hunkapiller currently holds 762,300 shares of the company. Michael Hunkapiller became President & CEO of Pacific Biosciences in 2012. He is Chairman of PacBio's Board of Directors, and has served on the Board since 2005.
The company reported the third-quarter financial results on October 25 with the following highlights:
|Net loss||$22.7 million|
|Shares outstanding||55.9 million|
|Cash per share||$2.14|
The company is targeting less than $20 million with cash usage per quarter, and less than $80 million with cash used for this year, which would translate to approximately $100 million in cash and investments at the end of the year.
The company's system revenue backlog of 5 units as of September 30, 2012 represents an order for one PacBio RS instrument received during the second quarter of 2012 and four PacBio RS instruments orders received during the third quarter of 2012.
Pacific Biosciences is currently trading below the industry average P/S ratio.
The stock is currently trading below the net cash level of $2.14 per share. There have been two insider buy transactions and there have not been any insider sell transactions this year. There is one analyst buy rating, four neutral ratings and four sell ratings with a average target price of $6.25. I have a bullish bias for the stock below the net cash per share level.
4. Progenics Pharmaceuticals (PGNX) is a biopharmaceutical company focused on innovative therapeutics for patients suffering from cancer and related conditions.
Progenics' pipeline candidates include PSMA ADC, a human monoclonal antibody-drug conjugate in phase 2 testing for treatment of prostate cancer, and preclinical stage novel multiplex phosphoinositide 3-kinase (PI3K) inhibitors for the treatment of cancer.
Progenics has exclusively licensed development and commercialization rights for its first commercial product, Relistor, to Salix Pharmaceuticals for markets worldwide other than Japan, where Ono Pharmaceutical holds an exclusive license for the subcutaneous formulation. Relistor (methylnaltrexone bromide) Subcutaneous Injection is a first-in-class treatment for opioid-induced constipation approved in more than 50 countries for patients with advanced illness.
Mark Baker purchased 48,833 shares on November 15 and 5,994 shares during January 11 - October 24 pursuant to a 10b5-1 trading plan. Mark Baker currently holds 93,672 shares of the company. Mr. Baker joined Progenics in 2005 as senior vice president and general counsel and secretary, and has since served as executive vice president, president, and was appointed to the board of directors. Mr. Baker serves currently as Chief Executive Officer of the company.
The company reported the third-quarter financial results on November 8, with the following highlights:
|Net loss||$11.3 million|
|Net cash||$44.3 million|
|Shares outstanding||33.8 million|
|Net cash per share||$1.31|
As announced on July 27 the FDA issued a Complete Response Letter [CRL] requesting additional clinical data for the supplemental New Drug Application [sNDA] for Relistor (methylnaltrexone bromide) injection for subcutaneous use for the treatment of opioid-induced constipation [OIC] in adult patients with chronic, non-cancer pain. On October 5, an End-of-Review meeting was held with the FDA's Division of Gastroenterology and Inborn Errors Products to better understand the contents of the letter. The Division has expressed a concern that there may be a risk associated with the chronic use of mu-opioid antagonists in patients who are taking opioids for chronic pain. In order to understand this potential risk, the FDA's Division has communicated that a very large, well-controlled, chronic administration trial will have to be conducted to assess the safety of any mu-opioid antagonist prior to market approval for the treatment of patients with OIC who are taking opioids for chronic, non-cancer pain. Salix has held discussions with the Division and has expressed the view that the post-marketing, clinical and preclinical data currently available for Relistor adequately demonstrate an appropriate and expected safety profile sufficient to permit the approval of the current Relistor sNDA.
Salix and Progenics plan to continue to work with the FDA to generate a reasonable path forward for the further development and regulatory review of Relistor that can be agreed upon by the parties. While it is not possible to determine definitively the duration of discussions with the FDA regarding this matter, at this time Salix and Progenics anticipate a path forward could be reached with the FDA during 2013.
Progenics opened enrollment in a phase 2 study of its PSMA ADC compound in prostate cancer patients during the third quarter. The trial is an open-label, multicenter study to assess the anti-tumor activity (measured by prostate specific antigen; circulating tumor cells; bone, visceral and nodal metastases; and pain), tolerability and safety of PSMA ADC in up to 75 subjects with metastatic castration-resistant prostate cancer.
There have been 12 insider buy transactions and eight insider sell transactions this year. There is one analyst buy rating, three neutral ratings and 0 sell ratings for the stock currently. I would expect the net cash of $1.31 per share to act like a support for the stock.
5. Celsion (CLSN) is a leading oncology company dedicated to the development and commercialization of innovative cancer drugs including tumor-targeting treatments using focused heat energy in combination with heat-activated liposomal drug technology. Celsion has research, license, or commercialization agreements with leading institutions including the National Institutes of Health, Duke University Medical Center, University of Hong Kong, the University of Pisa, the UCLA Department of Medicine, Kyungpook National University Hospital and the Beijing Cancer Hospital.
- Robert Hooper purchased 11,600 shares on November 15, 10,000 shares on September 10, 2,500 shares on August 29, 4,520 shares on May 15 and 4,500 shares on March 21. Robert Hooper currently holds 90,027 shares and serves as a director of the company.
- Jeffrey Church purchased 2,000 shares on September 14 and currently holds 18,787 shares of the company. Jeffrey Church was appointed Senior Vice President, Corporate Strategy and Investor Relations on July 8, 2011. Mr. Church joined Celsion in July 2010 as Vice President and Chief Financial Officer.
- Michael Tardugno purchased 5,000 shares on September 14 and currently holds 196,014 shares of the company. Mr. Tardugno was appointed President and Chief Executive Officer of the company on January 3, 2007 and was elected to the Board of Directors on January 22, 2007.
- Frederick Fritz purchased 5,000 shares on May 17 and 4,000 shares on March 19. Frederick Fritz currently holds 21,000 shares and serves as a director of the company.
The company reported the third-quarter financial results on November 12 with the following highlights:
|Net loss||$6.0 million|
The company is projecting average cash usage per month to be $1.7 million. Celsion has available to draw an additional $5 million from a $10 million loan facility with Oxford Finance LLC and Horizon Technology Finance Corporation, pending positive data from the Phase III HEAT Study. The company has no plans to raise additional capital before disclosing top line data from the HEAT Study which, if positive, will vastly expand the company's strategic and financing options.
In November 2012, the company announced that a minimum of 380 events of progression have been realized in the HEAT Study. According to protocol, 380 events of progression, subject to confirmation by the Study's independent Data Monitoring Committee [DMC], trigger the data collection process, unblinding and final analysis of the results by the DMC. Progression Free Survival [PFS] is the HEAT Study's primary end point which has been granted Special Protocol Assessment by the FDA. Following DMC review, the company plans to disclose top line results, an announcement that is expected to occur in January 2013.
The stock has a $8.75 price target from the Point and Figure chart. There have been nine insider buy transactions and there have not been any insider sell transactions this year. There are three analyst buy ratings, 0 neutral ratings and 0 sell ratings with a average price target of $7.67. The next major catalyst for the stock will be the HEAT study results due in January 2013. If we get negative results the stock could dip below $2. With positive results the stock will likely challenge the $10 mark.
Disclosure: I am long PACB.