While certain industries have been skyrocketing over the past few days, such as cannabis stocks, others have tumbled for one reason or another. While the confirmation of a Biden victory has definitely helped or hurt various industries, other sectors have seen declines for entirely different reasons. Friday saw a number of well-known biotech stocks tumble on missed earnings, poor clinical results, and general uncertainty.
Among the biggest losers just prior to the weekend was Global Blood Therapeutics (NASDAQ: GBT), a mid-cap biotech stock that specializes in treating blood disorders. Its main drug is Oxbryta, which treats patients with sickle-cell disease. Unfortunately for the company, revenue growth seems to have stagnated, with some Wall Street analysts downgrading the stock following its Q3 results.
“GBT shares will be range-bound until there are encouraging signals that Oxbryta’s growth trajectory is recovering to pre-covid levels,” wrote Raymond James analyst Danielle Brill in a note to clients. He went on to downgrade the company’s stock to a “neutral” from its previous “buy” rating. While this might not seem all that bad, it’s a pretty big mark against its future prospects for a growth-oriented biotech stock.
Overall, the company saw a 17% increase in revenue between Q2 and Q3, from $31.5 million to $36.9 million. While this seems pretty good on paper, shareholders were expecting prescriptions of Oxbryta to be much higher. At the same time, the company is still unprofitable, with Global’s Q3 net losses coming in at $59.9 million, which is still a pretty high figure.
In response to the news, Global Blood Therapeutics’ stock fell by 35%.
Other notable biotech stocks that have tumbled include Assembly Biosciences (NASDAQ: ASMB), whose shares tumbled as much as 65% on Friday. In this case, the company announced poor clinical results for its hepatitis B virus candidate, vebicorvir. The phase 2 trial testing the drug found that 39 of the 41 patients ended up seeing diminishing results after they discontinued treatment, more or less killing the drug’s chances of moving onwards in the clinical development process.
Amneal Pharmaceuticals (NASDAQ: AMRX) and Sarepta Therapeutics (NASDAQ: SPRT) are both down around 16% and 13%, both due to poor Q3 results as well. There are a handful of other small-cap biotech stocks that were down double-digit percentages as well.
While large-cap biotech stocks did relatively well last week, with certain names like Biogen jumping as much as 40% over last Wednesday, most small-to-mid caps seem to be struggling right now.
Global Blood Therapeutics Company Profile
Global Blood Therapeutics Inc operates in the healthcare sector of the United States. It discovers and develops novel therapeutics to address blood-based disorders. GBT440, its lead drug candidate targets the underlying mechanism of red blood cell (RBC) sickling, which provides the potential to treat sickle cell disease. GBT440. an oral, once-daily therapy arrests abnormal hemoglobin polymerization, the underlying mechanism of RBC sickling. In addition, the company is engaged in other research and development activities targeted at hereditary angioedema and owns exclusively licensed rights to its portfolio of product candidates in the United States, Europe, and other major markets. – Warrior Trading News
