In this article, I will feature one biotech stock that has seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:
- The stock is purchased by three or more insiders within one month.
- The stock is sold by no insiders in the month of intensive purchasing.
- At least two purchasers increase their holdings by more than 10%.
Achillion Pharmaceuticals (NASDAQ:ACHN) discovers, develops, and commercializes anti-infective drug therapies in the United States and internationally.
Insider buying during the last 30 days
Here is a table of Achillion's insider-trading activity during the last 30 days by insider.
|Name||Title||Trade Date||Shares Purchased||Current Ownership||Increase In Shares|
|RA Capital Management||10% Owner||Oct 31-Nov 20||4,091,007||23,366,007 shares||+21.2%|
|Dennis Liotta||Director||Nov 22||10,000||100,000 shares||+11.1%|
|Jason Fisherman||Director||Nov 18-19||15,000||40,000 shares||+60%|
There have been 4,116,007 shares purchased by insiders during the last 30 days.
Insider buying by calendar month
Here is a table of Achillion's insider-trading activity by calendar month.
|Month||Insider buying / shares||Insider selling / shares|
There have been 15,283,946 shares purchased and there have been 2,764,900 shares sold by insiders this year. The month of October has seen the most insider buying.
Achillion reported the third-quarter financial results on November 12 with the following highlights:
|Net loss||$13.9 million|
Achillion believes that its current cash balance of approximately $173 million will be more than sufficient to reach several value creating milestones and fund its operations for at least two years.
Pipeline and upcoming milestones
Achillion's discovery, clinical development, and commercial teams have advanced multiple novel product candidates with proven mechanisms of action into studies and toward the market. Achillion is focused on solutions for the most challenging problems in infectious disease including hepatitis C virus (HCV) and resistant bacterial infections.
Achillion has the following upcoming milestones:
|ACH-3422||28-day animal tox studies||Ongoing|
|ACH-3422||Phase 1 healthy subject study||1H/2014|
|ACH-3422||Phase 1 HCV proof-of-concept trial||1H/2014|
|ACH-3422||Phase 2 HCV all-oral combination trial||2H/2014|
|ACH-2684||Drug-drug interaction study to begin||1Q/2014|
|ACH-2684||Combo trial expected to begin||1H/2014|
(Source: November 13 presentation)
Achillion's competitors include Gilead Sciences (NASDAQ:GILD), AbbVie (NYSE:ABBV), Bristol-Myers Squibb (NYSE:BMY), Vertex Pharmaceuticals (NASDAQ:VRTX), Johnson & Johnson (NYSE:JNJ), Merck (NYSE:MRK), and Idenix Pharmaceuticals (NASDAQ:IDIX).
(Source: November 13 presentation)
Here is a table of these competitors' insider-trading activities this year.
|Company||Insider buying / shares||Insider selling / shares|
Only Achillion has seen intensive insider buying during the last 30 days.
There have been three different insiders buying Achillion and there have not been any insiders selling Achillion during the last 30 days. All three of these insiders increased their holdings by more than 10%.
There are two analyst buy ratings, 10 neutral ratings, and one sell rating with an average price target of $5.31. The stock plunged on September 30 after Achillion announced that the FDA concluded that the removal of the sovaprevir clinical hold is not warranted. The insiders started buying the shares after this news. I believe the stock could be a good pick from the current price level based on the intensive insider buying.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in ACHN over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.