Neptune Technologies (NEPT) was one of a few green equities in a sea of red on Friday. Why? Some of NEPT’s largest shareholders, a crowd with a history of activism, hope to affect change at the Canadian manufacturer of krill oil supplements according to a 13D filing that hit on Thursday after the close. The filing suggests that the company should implement changes to its Board of Directors and management to improve profitability and stock performance.
All four of these investors – George Haywood, Con Egan, Conor O’Driscoll, and Fulvio Dobrich – were influential in the ouster of former Sarepta Therapeutics’ (SRPT), then AVI Biopharma, CEO Les Hudson in 2010. Read Activism at Neptune: Sarepta Deja Vu,or understand the investment thesis in PropThink’s previous report.
Also on Friday, we published our first look at Albany Molecular (AMRI), a stock we’ve followed with interest since CEO Bill Marth presented an aggressive growth plan for the small API manufacturer/CRO early this year. It’s not a terribly sexy story, but one that we believe has multi-bagger potential. Owning the stock is a bet on management and the team’s plan to generate revenue of $1.4 billion by 2019 – the company’s worth just $500 million. We like the strategy, but gauging an entrance in the stock is difficult in this environment. Get the full story here.
Sarepta Therapeutics (SRPT) cancelled a presentation scheduled for Tuesday afternoon and in-tandem launched a newly redesigned website (http://www.sarepta.com/). Over-analyzing the new website is a fool’s errand, but with the company slated to give an update on the regulatory path for eteplirsen following its March meeting with the FDA, the cancellation had many speculating that a press release or conference call was imminent. That hasn’t happened in the days since the cancellation.
Last year, Sarepta held a conference call just days after a meeting with the FDA in which the regulatory body suggested that it would be “premature” to file for approval in DMD based on existing phase 2 data for eteplirsen. Assuming the latest meeting with the FDA actually took place in March, either SRPT has more to hash out with the regulatory agency or the company is taking a more conservative approach than last time around and is waiting for meeting minutes from the event. The company should have those within 30 days of the meeting, thus an announcement by the end of April islikely, again, assuming the meeting took place in March. PropThink suggested owning the stock in January at $18. SRPT is a story we continue to follow closely.
One of 2013’s bio IPOs, Agios Pharma (AGIO), saw a soaring share price on Mondayafter reporting early data demonstrating that its cancer metabolism drug AG-221, a first-in-class inhibitor of IDH2 mutations, generated promising clinical activity, including complete remissions in several patients whose blood cancers harbored the mutation. An “oncometabolite”, 2-hydroxygluturate (2HG) is a by-product of the mutated IDH2 gene. Initial findings support the theory that inhibiting mutant forms of IDH2 suppresses the growth of these 2HG-producing tumor cells. While the science is attractive, we have a hard time swallowing AGIO’s $1.5B valuation. The company filed to sell $75 million in stock later in the week.
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One or more of PropThink’s contributors have taken a position in NEPT, SRPT, and AMRI.
