Weekly thought on $IBIO, $LRAD

Before you read on, please be aware that the analysis below is my opinion only and may include flawed assumptions and inaccuracy of logic; therefore, caveat emptor applies here.  Furthermore, all emphasis (color-coded, boldness, and underlined) on the excerpts are my own.

After a faulty start at the gate on Tuesday, the bull smashed through the bear attack and ended the week closing above the uptrend line.

SP500 Weekly Chart

The bull is back!

This week, I made a successful swing-trade on $DUST and added $NOK to my port. For now, I see $NOK as a short-term technical trade since the overall picture still carries a bearish tone with the price trading below the long-term uptrend line.

$NOK weekly Chart

However, if the price can follow the previous pattern of bouncing after a “green” bar showed up at the bottom of the downtrend, I may hold onto my $NOK for a possible reversal of the trend to the upside. If not, I will be stopped out at breakeven. Since $NOK is not yet a permanent position in my port, it will not be part of my weekly thought.

$IBIO –

This week, I like to highlight some developments that provide traction for iBio to pick up revenues sooner than skeptics think.

Let starts with the CC-Pharming deal

  1. KEY developments
    1. China is fast-tracking biosimilars for anti-cancer biologic drugs
    2. CC-Pharming completed its 8,000 sq. ft. pilot plant-based facility using iBio’s Factory Solutions
    3. CC-Pharming is in the process of building a large-scale plant-based facility using iBio’s Factory Solutions.
    4. CC-Pharming is entering into non-pharmaceutical products

Regarding #1.1 above, here is a link to the Chinese article that provided the clue that China FDA is giving top priority to the anti-cancer biosimilars -> The first domestic biosimilar drug rituximab was approved for marketing

Below is an excerpt from the Chinese article translated by Google:

Key takeaways from the paragraph above:

  • Accelerate the registration and approval of NEW ANTI-CANCER DRUGS
  • The State Food and Drug Administration (aka China FDA) will further DEEPEN THE REFORM of the drug review and APPROVAL system.

Here is another excerpt that emphasized the approval process

Key takeaways from the paragraph above.

  1. SPECIAL SUPPORT
    1. Applicants obtained comprehensive
      1. data quality similarity studies
      2. non-clinical similarity studies
      3. clinical comparison studies
    2. on the safety and efficacy
    3. and submitted a registration application
    4. China FDA, according to “Opinions on Deepening the Reform of Examination and Approval System Reform”
      1. SUPPORTS biosimilar drugs with the imitation of the clinical value of the drug-medicine
      2. REQUIRES the products to be included in the PRIORITY REVIEW AND APPROVAL PROCESS”
      3. At the same time as the technical review
        1. the production site inspection and inspection work is SIMULTANEOUSLY started
        2. which SPEEDS UP THE LISTING of the product.

My opinion: I can see the possibility that item 1.1 to 1.3 are being expedited with comprehensive data from iBio’s clinical studies on iBio Rituximab. Item 1.4.1 to 1.4.2 is China’s commitment to FAST TRACK biosimilar biologic drugs. And item 1.4.3 has the possibility of SPEEDING up the approval process of iBio Rituximab BECAUSE CC-Pharming ALREADY has an 8,000 sq. ft. pilot plant-based facility for inspection by the China FDA.

By the time the China FDA approves CC-Pharming to market iBio Rituximab, the large-scale plant-based facility using iBio’s Factory Solutions may be ready for mass-production.

Regarding CC-Pharming venturing into non-pharmaceutical products, it is best to hear straight from the horse’s mouth. Below is an excerpt from the recent PR on CC-Pharming/iBio deal.

Key takeaways from the above paragraph

  • Growing product category of GREAT INTEREST to CC-Pharming is the SKINCARE market
    • which reached sales volume of $67 BILLION in China last year

The beauty market, especially SKINCARE, is growing by leaps and bounds despite HIGH consumer prices in the retail market. Here is an article that highlighted the booming industry in skincare-> “

THE SKIN-CARE INDUSTRY IS THRIVING — BUT HOW LONG CAN THIS BOOM LAST? Experts weigh in on the sustainability of the category’s undeniably rapid growth

Below is an excerpt from the article:

Key takeaways from the paragraph above:

  • Consumers are BECOMING INCREASINGLY focused on a SKIN-FIRST approach to beauty
  • Today’s customer is more CONCERNED with their SKIN’S HEALTH and LONGEVITY
  • The SKIN-CARE category’s growth is now OUTPACING that of makeup.
  • According to the report by NPD Group, SKIN-CARE’S year-over-year growth clocked at 16% (while makeup had only grown by 3%)

My opinion is that the skincare market has the potential to generate even more revenues than iBio rituximab.

My opinion on the CC-Pharming deal

Based on the Chinese article, the China FDA is SERIOUSLY expediting the biosmilar market. While I do not know exactly how fast CC-Pharming will receive approval from the China FDA regarding iBio Rituximab, it is POSSIBLE that comprehensive studies provided by iBio will allow CC-Pharming to submit the registration application sooner than expected. Don’t forget that CC-Pharming’s 8,000 sq. ft. plant-based facility allows the China FDA to SIMULTANEOUSLY inspect the production site during the technical review of the comprehensive studies.

Another BONUS besides the iBio Rituximab penetrating the China anti-cancer biologic drug market is the SKINCARE market. With the cost-saving of using the plant-based expression, consumers can now afford EFFECTIVE skincare solutions that don’t cost them arms & legs. And when you combine the revenues stream from both the skincare and iBio rituximab, Lo and behold!

Let talks about the United Therapeutics MSA agreement

As I had mentioned in my previous blog post, CollPlant signed a collaboration agreement with United Therapeutics back in October 2018. Below is a page from CollPlant’s presentation:

Think about it for a moment. We are now almost close to a year from October 2018. What does this mean? My opinion is that United Therapeutics’ subsidiary Lung Biotechnology PBC has done all the necessary testings and preparations. They may be ready to move forward with the clinical trials. Hence, the recent signing of the MSA agreement with iBio.

Let review the MSA agreement again

The Master Services Agreement (MSA) involves the following:

  1. development of a scalable purification process for rhCollagen tailored to the biofabrication of lung scaffolds that United Therapeutics licensed from CollPlant Biotechnologies ($CLGN)
  2. develop cGMP supply of the material for clinical trials
  3. anticipate the need for commercial quantities of rhCollagen-based bioinks
  4. additional projects focused upon process optimization and capacity expansion
    1. Capacity expansion will employ iBio’s Factory Solutions capabilities

Take a look at item 3- Anticipate the need for commercial quantities of rhCollagen-based bioinks. It seems to me that iBio is given the task to work with Lung Biotechnology PBC to determine the amount of rhCollagen is needed. In other words, iBio is ACTIVELY involved with United Therapeutics’ subsidiary in this venture.

My opinion on the United Therapeutics MSA agreement

Giving the “active” role iBio has with Lung Biotechnology PBC, I see momentum in the production of the rhCollagen. In other words, we may see a revenue stream coming into iBio in the 4th quarter of 2019.

My opinion

Giving the STRONG fundamental developments per my perspective, I’m holding all my shares plus some I added last week, so I don’t have to worry about having to chase the stock back. I believe that once iBio complete the funding, the selling pressure that is holding a tightly wound spring down will start to lose its grip. And when more positive news arrives, the spring will break through violently to the upside.

In essence, NO ONE can buy the bottom. If you did, you were lucky. When price starts tracking the growing revenues stream, anything under a buck is considered a STEAL, in my opinion!

LRAD –

Technically speaking, LRAD corrected this week.

$LRAD Weekly Chart

From the weekly chart, price is currently at Fib 38.2% retracement support level. The other support is August 2018 high of around $3.4x. We may see a bounce next week. My opinion is that selling this week had more to do with traders exiting for other plays.

Fundamentally speaking, as I mentioned before, we may hear news relating to the catalysts below:

  • The new VP of Software Sales (Paul) is currently overseeing several SaaS only proposals pending in the U.S. and two other countries. The proposals include city, regional, and national installations.
  • LRAD is well-positioned to compete for the EU alert directive & the global unified critical communication market. The EU mandates all 31 economic zone countries to establish emergency warning alert systems to protect citizens and travelers by June 2022. The company’s divisional staff at Madrid are also engaged in pursuing these EU country opportunities.
  • LRAD is working on several other public safety and emergency warning opportunities in California. The company expects new orders from cities in the next fiscal year.

LRAD is a long-term hold for me. Even though the price went down, it is really hard to buy back the shares without spiking it up like a jack rabbit.

Due to corrections on $IBIO and $LRAD, my port gave back some more this week.

Current positions (in alphabet order):

Stocks = $AEMD $IBIO  $LRAD $NOK

Call Options = $TRXC

Up >15% YTD

My 2 cents

From my camera:



Categories: Daily trading Journal, trading journal

Tags: , , , ,

2 replies

  1. Great observation,

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