Achillion Pharmaceuticals: 3 Different Insiders Have Purchased Shares This Month

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:

  1. The stock is purchased by three or more insiders within one month.
  2. The stock is sold by no insiders in the month of intensive purchasing.
  3. 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.

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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%
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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
November 2013 2,930,000 0
October 2013 6,003,946 0
September 2013 2,800,000 2,754,900
August 2013 112,282 0
July 2013 3,397,718 5,000
June 2013 40,000 5,000
May 2013 0 0
April 2013 0 0
March 2013 0 0
February 2013 0 0
January 2013 0 0
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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.

Financials

Achillion reported the third-quarter financial results on November 12 with the following highlights:

Revenue $0
Net loss $13.9 million
Cash $173.1 million
Debt $0.4 million
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Outlook

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.

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(Source: Achillion)

Achillion has the following upcoming milestones:

Compound Study Timeline
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
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(Source: November 13 presentation)

Competition

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).

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(Source: November 13 presentation)

Here is a table of these competitors' insider-trading activities this year.

Company Insider buying / shares Insider selling / shares
GILD 10,000 5,553,222
ABBV 4,500 209,395
BMY 0 2,607,814
VRTX 0 1,447,775
JNJ 0 113,709
MRK 0 431,484
IDIX 0 0
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Only Achillion has seen intensive insider buying during the last 30 days.

Conclusion

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.