Alexion Pharmaceuticals: 4 Different Insiders Have Sold Shares This Year

In this article, I will feature one biotech stock that has seen intensive insider selling during the last 30 days. Intensive insider selling can be defined by the following three criteria:

  1. The stock was sold by three or more insiders within one month.
  2. The stock was not purchased by any insiders in the month of intensive selling.
  3. At least two sellers decreased their holdings by more than 10%.

Alexion Pharmaceuticals (NASDAQ:ALXN) develops and commercializes life-transforming therapeutic products.

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Insider selling during the last 30 days

Here is a table of Alexion's insider-trading activity during the last 30 days by insider.

Name Title Trade Date Shares Sold Rule 10b5-1 Current Ownership Decrease In Ownership
Stephen Squinto EVP Feb 4 32,937 No 94,818 shares 25.8%
Larry Mathis Director Feb 3 80,729 No 29,456 shares + 11,713 options 66.2%
Max Link Director Feb 3 40,000 No 58,574 shares 40.6%
Leonard Bell CEO Jan 8-22 191,436 Yes 977,726 shares + 130,280 options 14.7%
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There have been 345,102 shares sold by insiders during the last 30 days. Leonard Bell sold shares pursuant to a Rule 10b5-1 plan. More details about the Rule 10b5-1 trading plan can be found from this link.

Insider selling by calendar month

Here is a table of Alexion's insider-trading activity by calendar month.

Month Insider selling / shares Insider buying / shares
February 2014 153,666 0
January 2014 191,436 0
December 2013 273,000 0
November 2013 14,125 0
October 2013 139,037 0
September 2013 36,350 0
August 2013 187,275 0
July 2013 372,125 0
June 2013 0 0
May 2013 122,103 0
April 2013 147,729 0
March 2013 23,115 0
February 2013 0 0
January 2013 70,000 0
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There have been 1,729,961 shares sold, and there have been zero shares purchased by insiders since January 2013.

Financials

Alexion reported the full-year 2013 financial results on January 30 with the following highlights:

Revenue $1.6 billion
GAAP net income $252.9 million
Cash $1.5 billion
Debt $113.0 million
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Outlook

Alexion's 2014 guidance is as follows:

Revenue $2.00-$2.02 billion
Non-GAAP earnings $3.70-$3.80 per share
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Pipeline and upcoming milestones

Alexion's Soliris is approved in nearly 50 countries for the treatment of patients with Paroxysmal Nocturnal Hemoglobinuria, including the United States, European Union and Japan. Soliris is also approved in the United States, European Union, Japan and other countries as the first and only treatment for pediatric and adult patients with aHUS, a genetic, chronic, ultra-rare disease associated with vital organ failure and premature death.

In 2014, Alexion expects to continue to extend its aHUS initiatives in the United States, complete the aHUS reimbursement processes across Western Europe, achieve a robust launch in Japan on its first full year of aHUS operations, and build on its initial presence in Turkey, Russia and Brazil.

Alexion is anticipating as many as seven potential product approvals between 2014 and 2018. These product approvals include asfotase alfa near late 2014.

Competition

There are currently no approved drugs other than Soliris for the treatment of PNH and aHUS. However, many companies, including major pharmaceutical and chemical companies as well as specialized biotechnology companies, are engaged in activities similar to Alexion's.

Conclusion

There have been four different insiders selling Alexion, and there have not been any insiders buying Alexion during the last 30 days. All four of these insiders decreased their holdings by more than 10%. Alexion has an insider ownership of 0.80%.

Before going short Alexion, I would like to get a bearish confirmation from the Point and Figure chart. The main reason for the proposed short entry is the intensive insider-selling activity.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within 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.