Delayed update

It has been a few days since I updated the site. I have had a few extracurricular activities and some travel that have kept me away. I did, however, made some significant changes to the portfolio on Monday morning. I was primed to do so by the poor jobs numbers on Friday morning and by the apparently increasing pessimism coming out of the EU. It has been awhile since we have had a European debt crisis & I think that the markets will probably react badly. In addition, consensus seems to be that the upcoming quarterly earnings will be disappointing. So I was wary after the weekend and dumped positions on a hint of weakness.

SPPI: On Monday morning I closed my position in Spectrum. After the big hit on the Friday before Good Friday. I closed at $10.61, very soon after the open. This is disappointing. SPPI is a position I have held for >2 years. It was a great performer during 2011 but 2012 has been less than stellar. It peaked at $16 during January and just failed to break through that level. I closed up based on my initial purchase but based on the November ’11 indexing of the portfolio I was down 19%.

PLX: Also closed this position on Monday. I spoke with a friend who once worked in a specialty biotech firm that dealt with inborn errors of metabolism. He was skeptical about PLX (knew the company quite well) and felt fairly sure that a CRL would be forthcoming. I had been in the position since mid-February and was up 14% so I was happy to close on Monday.

HZNP: This opened below my stop loss on Monday so I was out very quickly after the open. I had previously sold 50% of my position at $4.28. I exited the rest at $3.92. This gives me a 20% gain on the position over the 46 days I held.

XNPT: General nervousness drove me out of XNPT at $4.53. This had never really got going after my purchase on 3/23 so when it opened beneath my entry on Monday I looked for an exit. Up 2% in this one in 17 days.

PGNX: Still in this one. It just about managed to stay above my maximum pain threshold on Monday (though it came very close a couple of times). I am not giving it much room on the downside as it gets close to the PDUFA date!

So there we have it. I am down to a single holding now and am waiting to see where I should deploy cash. Not in a terrible hurry until the market feels a bit safer though. I finished Monday up 49% in the portfolio. This is down from a high of 58% last week. The drawdown is almost entirely due to SPPI – and in particular its recent phase III failure. Biotech investing success is so dependent on being aware of potentially devastating news and limiting one’s exposure appropriately.


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