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   Daily Blog - Tiger Software

                   September 21, 2007

            Biotech's Game of Roulette.

        Tiger's Power Stock Ranker
              Lets You Beat The House.

William Schmidt, - Tiger Software's Creator
      (C) 2007 William Schmidt, Ph. D.  - All Rights Reserved. 

      No reproductions of this blog or quoting from it
      without explicit written consent by its author is permitted.

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                Yes, Playing Biotechs Can Be A Lot Like Playing Roulette.   
But TigerSoft's Power Stock Ranker Lets You Beat The House...

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  Walk up to a roulette table, place your money on a single number and the odds are only
       one in 37 (European wheel) or one in 38 (American wheel) that your bet will pay off.  But when you
       do win,  you get a big stack of chips back, 35 for every one you invested.  It's like that in biotechs.
       For every Amgen there are hundreds of biotechs still trying to hit it big.  

                    The FDA has become increasingly cautions after the withdrawl of Vioxx.  The FDA
       approved only 17 new prescription drugs in 2006, the lowest number in a decade.   This is a
       major factor in the past year's weakness in biotechs.

                    wpeC.jpg (16657 bytes)     
                    (Source: http://www.msnbc.msn.com/id/20321830/ )


                   The prospects for a change in the FDA approvals' downtrend are not bright, though according
        to the
Pharmaceutical Research and Manufacturers of America
, pharmaceutical companies have in
        development 646 compounds for cancer, 146 for heart disease and stroke, 77 for HIV/AIDS and
        56 for diabetes.  There is a concern about the lack of new drugs for diseases without treatments. 
        Bush's hypocritical and anti-science vetoing of government assistance to stem cell research makes
        matters much worse.  Showing either his limited math skills or his very political side, or both, Bush
        announced that cancer deaths had just recorded the "steepest drop ever recorded".  That was just
        after the news came out in 2004 that the number of cancer deaths declined by all of one half of one
        percent between 2003 and 2004.

                                      How To Trade Biotechs with TigerSoft

                   Still, the biotech industry is not a lottery or a game in a casino.  From the investments of
       perhaps $150-200 billion to date, will come drugs and vacines that will save millions of lives ultimately.
       But it does take years and years of research to bring a new successful drug to market.  During that time,
       thousands get a preview of its effectiveness.   If things go well for the company, the stock moves
       up years before the final FDA approval and the first prescriptions are given.  TigerSoft users
       see lots of blue accumulation if things are going well.  They see an uptrend even in a bear market.
       And usually they see long periods of inactivity followed by brief bursts of very high volume when
       a new drug's trials are formally reviewed by the Food and Drug Administration's regulatory process.

                   The success or failure of a new drug's clinical trials is quickly translated into movement by
       the company's stock price.  Consider two cases.   Genentech and La Jolla Pharmaceuticals in the
       same period 2002-2004.

                          Genentech (L)                                            La Jolla Pharmaceuticals (R)

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                                                    TigerSoft's Trading Secrets

                            To be successful, the biotech trader should screen stocks above their 50-day ma

                      1)   Sometimes subtle rise in relative strength - see DNA, July to December 2002.
                      2)   Gaps with sudden changes in volume - see DNA, May 2003.  (BuyB18)
                      3)   Sudden rises in accumulation as measured by Tiger's Accumulation Index - see DNA May 2003.
                                        (Buy B17)
                      4)   Accumulation Index up to level we consider it a sign of "insider buying"- see DNA May 2003.
                                        (Buy B24)
                      5)   Price Breakout. see DNA May 2003. (Buy B10)

                                                 DNA -2002
                      In the bear market of 2002, DNA ran up to and backed off from the neckline - resistance
                  at 19-20 on sixe different occastions.  Any move above should have been considered as a very
                 bullish sign.
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                                        DNA -2003    Breakout, Gap and High Volume over $20.          wpe13.jpg (68293 bytes)            
                                                DNA -2003 - Continued              
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                                            LJPC - La Jolla Pharmaceuticals - 2002

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                                     LJPC - La Jolla Pharmaceuticals - 2003

                        On February 13, 2003, La Jolla Pharmaceutical Company announced preliminary findings from
             a Phase III clinical trial evaluating Riquent™, previously known as LJP 394, for the treatment of lupus
             renal disease.   "Initial assessment of the trial data indicates that treatment with Riquent did not
             increase length of time to renal flare, the primary endpoint, in a statistically significant manner
             when compared with placebo through the end of the study."
This sentence caused the stock to drop
             28 points!   Buying before the Phase III trial results are released is very risky.   Biotechs that are going to
             report excellent Phase III trials are likely to be in uptrends even in a down market.  Elsewhere we saw
             this was true with Amgen from late 1989-1990.

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     Examples of Gaps,  Volume and Tiger Accumulation Surges
            in Biotech Stocks in 2006-2007 over $10 And Their Outcome

         These are flagged as "Buy B17s and B18s with Red Price Bars".  They are the first
         to occur after September 2006.  Both B17 and B18 must occur on same day.
         (This is not to say that a Buy B17 won't work by itself or when the stock is under $3.
          Look at AGEN on 3/30/2007.)   The B17 and B18 should not be more than 10 days apart.
          Major B10s, B12s and B24s also work well here.  

Tiger's Power-Ranker flags and lists these stocks for you each night with just one command..  

         Look at the news for the stock.   Upgrades are fine.  No apparent news is even better.

         ABAX  20.57  1/26/07  hit 27 on 4/16/07 ...by Augiust it had fallen back to close the gap
         ACAD  13.61  3/19/61 hit 17 on 4/4/2007 ... Dipped back to 12.5 and retested 17..
         ACL    129.77   2/8/2007 hit 144 on 4/27/07... Dipped back to 130 and re-tested 145.
         AGIX   12.06    1/5/2007 hit 19.9 on 2/15/07/  Then declined down to 2!  It's 50-day ma never turned up.
         AMRI   12.58    5/9/2007 hit 17 in July.  Closed gap down to 11 in August and re-tested lows.
         Jeffries & Co. changed their rating for the chemistry services and drug-discovery company to buy from hold.
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         ARTC    39.69   4/13/2007 hit 60 in August. (See chart below).
         Lazard upgrade to buy from hold 
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New Drug Approvals By Year  (A work in progress)

                     I think there is a need for a simplified master list of new drugs getting approval.  I have started building
       such a list below, along with refernces to news items about the FDA for each year, starting in 1990.  The materials
       below will be expanded, as time permits.  This will also allow us to see how readily one can make money investing
       in companies when they finally DO get approval for new drugs..

                                   Year                    FDA Approvals
                                   -------                 -----------------

                                  September 14, 2007   Evista, Lilly's osteoporosis drug for use in reducing the risk
        of   invasive breast cancer. The approval covers postmenopausal women with osteoporosis
        and postmenopausal women at high risk for invasive breast cancer.

                                  April 6, 2007, Shire and its newly acquired subsidiary—New River Pharmaceuticals—
        won final approval from the U.S. Food and Drug Administration (FDA) last month to market
       lisdexamfetamine (Vyvanse) for treatment of attention-deficit/hyperactivity disorder (ADHD) in
       children and adolescents aged 6 to 12.

                                                                         FDA more cautious after Viozz was pulled.  Rejecting or delaying
                                                                         more new drugs. Through mid-August 2007, the FDA has approved 61
                                                                         percent of drug applications, down from 73 percent in the same period
                                                                         of 2006.

                                                                         FDA staff now realize new drugs will be used by many patients beyond
                                                                         those intended — known as off-label use because the drug is taken for
                                                                         another condition than the one it was approved to treat. That often boosts
                                                                         the chances that some patients will be harmed by side effects.
                                                                        But the caution causes deaths, too. The DC Court of Appeals has ruled that
                                                                        patients don't have the right to potentially life saving drugs.

                                                                         Diabetes drugs Avandia and Actos forced to show warning labels
                                                                         about the medicines worsening heart failure. Made by Glaxon SmithKline
                                                                         and Tekeda Pharm.
                                                                         FDA criticized after study finds drug-related deaths doubled between
                                                                         1998 and 2005. Myriad problems with the government's monitoring
                                                                          of drugs before approval and after they are on the market.

                                                                         Approvals for Endo Pharm.'s migraine drug was delayed for use
                                                                         in preventing menstrual migraines.

                                                                         Merck's Arcoxia was rejected in April  It was the long-planned
                                                                         successor to Vioxx.

                                                                         FDA has cited safety or effectiveness questions in rejecting or delaying
                                                                         approval for experimental drugs including Novartis' diabetes drug
                                                                         Galvus, Sanofi-Aventis' weight-loss drug Zimulti, and even a higher
                                                                         dose of GlaxoSmithKline's Advair Diskus for bronchitis and emphysema
                                                                         symptoms. Also shot down: Wyeth's experimental schizophrenia drug
                                                                         bifeprunox and Wyeth's Pristiq, which would have been the first
                                                                         nonhormonal drug for menopause symptoms. (8/17/05 - MSNBC)

                                    2006                              17 or 18

                                    2005                              20 (new molecular entity) 36 (new fotmulations)
                                                                          82 See full FDA list http://www.fda.gov/CDER/rdmt/InternetNDA05.htm
                                                                                AMLN - Exenatide - 4/28/2005
                                                                                Biolvail Labs -  Tramadol (A happy pill!) 5/5/2005
                                                                                                           Teva Pharm. - Metronidazole 5/20/2005
                                                                                                           Biovail - Zolpidem - 5/26/2005
                                                                                                           Biovail - Metformin - 6/3/2005
                                                                                                           Sicor Pharm - Levofloxacin - 6/05/20
                                                                                                           Celgene - Revlimid (Lenalidomide) 12/27/05

                                                                        -Postponed decision of morning-after pill.
                                                                        -Spring 2005, a second pain pill in the same class known as Cox-2
                                                                         inhibitors, Pfizer Inc.'s Bextra, was withdrawn           
                                                                        -Decline is because the federal agency is exercising more caution
                                                                          following the recall of the drug Vioxx in 2004, which has resulted in
                                                                          more than 6,000 lawsuits after it was linked with heart attacks and strokes.
                                                                       -Most frequent suspect drugs in death and "serious non-fatal outcomes"
                                                                         were pain narcotics Oxycodone and Fentanyl, which are both in the
                                                                         class of drugs known as opioid analgesics. 
                                    2004                              29 or 36
                                                                                  DNA - Tarveca - treatment of lung cancer
                                                                                  DNA - Avastin - treatment for colon cancer
                                                                                  MYLAN LABS - Apokyn Research) for Parkinson's disease
                                                                                  ILEX Oncology - Clorar - for children with leukemia
                                                                                  Merck KGaA. - Sante drug for alcoholism treatment
                                    2003                              14
                                    2002                              20
              To be continued.....












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