Biotech Opinions (DVAX, VVUS), & Question About Reverse Splits

I bought 100 shares of DVAX about 8-9 years ago for $9.67 a share. Since then it has hung around $3-4 on hopes of getting approval for it's Hepatitis B Vaccine Heplisav. Their last trial was deemed too small for FDA approval, which sent the stock tanking to $1. I put about a decent amount of money in it at that price.

They have started a new trial, with enough test subjects to supposedly allow FDA approval. The stock has been as high as $2.10, and has settled at around 1.30-1.40 for a long time now, sometimes going to the 1.50s and 1.60s. The initiation of the latest trial was completed 3 months early, and they are expecting approval in October of 2015.

I quit gambling about 2 years ago (with a few slip ups), and have been shoving all of my savings into the company since then.

I was wondering if anyone could give me their opinion on DVAX. The unfortunate thing is that they just had a 1-10 reverse split, which I believe is typically a bad thing? I'm not sure. So the stock is artificially at like $14 right now after that.

What are your opinions on reverse splits, and the potential of this company assuming it gets approval in October next year. In this trial DVAX is also testing it against their direct competitors drug to prove it is superior (GlaxoSmithKline Energix-B).

Side Note: I also have a smaller stake in VVUS who makes an obesity drug called Qsymia. I have a co-worker that takes it, so I know it works. It was a $30 stock about a year or 2 ago. I got in at $5.50, and it's about $3.15 now. They just keep losing money every quarter for some reason. I'm wondering if I should just sell it and get back a few grand, and offset a capital gain at this point. I see a competitor's commercials all the time advertising a drug called Belviq. Honestly, I didn't do my research on this company, so that's kinda my fault.

Thoughts on biotech investing in general are welcome as well. I realize that sometimes they are complete gambles, which is why I naturally gravitated towards them after I quit gambling.

I feel DVAX is as close to a sure thing as there is when it comes to biotechs though. This drug has been like 5 years+ in the making. Smaller trials showed it was safe and superior to it's competitor, and they haven't experienced any SAEs (serious adverse events) in the first 6 months of the current trial.

I figure if DVAX settled at around $4 a share when they assumed approval in the past, it should have no problem getting there again if the drug is officially approved, or $40 considering the 1-10 reverse split.

Sorry if that is a joe public, or square way of thinking. I don't bet like that.

I've highlighted the key points of the post for those that can't read all my ramblings.

If a stock gets to be under a dollar, it goes up and 1% every time it moves a penny.  So they do the reverse split to make it less volatile that way, so it can up and down a penny and only be a tenth of a percent.

DVAX probably did the RS because they didnt want to be crushed by short sellers and have to be delisted.

I thought a stock would only be in danger of being delisted if the stock price drops below $1. The stock has been firmly above $1 for over a year now. It dropped below $1 for a period of 30 minutes or less a year and a half ago.

They did a secondary offering earlier this year I believe, to raise that cash they have now. This is just my simple minded speculation here, but they just recently changed the company that does their stock offerings last week. Despite have $130M in cash, they used around $30M in cash last quarter for all that R&D and finishing the initiation of the trial. At that rate, they would be very close to having no cash by the time of approval next fall. The stock has recently gone down about $2.00 since that announcement.

Question: Do these small biotechs typically do additional share offerings to help launch their product? Is there any other way besides finding a teaming partner?

 

Yeah that happens all the time.

Thanks WallStreetCappers. I was hoping you in particular would comment on my thread.

How much of a hit could DVAX take if they were to do a second offering in less than 2 years?

The agreement with Cowen Company allows them to offer up to $50M worth of stock.

It depends on the size of the offering relative to the market cap of the stock..and the performance of the stock at the time.

Happy New Year Guy.

As an update, earlier this month GSK chose to end their agreement with DVAX on their Lupus treatment. This was expected, as the trial didn't show enough positive endpoints to keep going.

The asthma treatment they were developing with AstraZeneca did well enough for AZ to keep sponsoring it. They have moved on to phase 2 of the trial. DVAX can get up to $100M in milestone payments for this product, as will get royalties upon it's possible approval.

I mentioned earlier about the agreement with Cowen company to possibly do another offering to raise up to $50M. The thought of possible dilution of shares sent the stock down to a little below the $15 range, butt the stock has had a good deal of stability at 15.

A couple of days ago, DVAX was able to secure a $40M loan. $10M was right away, and the rest is due with milestones on the Hepatitis B vaccine. This helped the stock price go from low 16s, to a high of $18.16. It settled at 17, and pulled back to a little below 17 to end the year.

I'm not sure why DVAX would be so insistent on borrowing money when they should still have well over $100M in the bank, but perhaps they are simply preparing for a launch later this year. Better to have those agreements finalized way ahead of time I suppose.

"This credit facility provides us access to up to $40 million of non-dilutive funding that can be used to support development and pre-commercialization activities for HEPLISAV-B, clinical trials of our cancer immunotherapeutic product candidate, SD-101, and advancement of our research programs," said Eddie Gray, CEO of Dynavax."

So does anyone have any idea how much money it takes to launch a product like this? Should I be looking deeper to find the reason why they needed to sign 2 agreements to allow them to borrow money in the past month?

The price of the stock on my original post (11/17) was $14.46.

The price as of the end of the year (12/31) is $16.86.

I've seen price targets of $40 and $60, so there is still time to add before the expected approval in September of 2015.

Another DVAX update for you guys.

So DVAX had a pretty good run this week. Last Friday it closed at $17.60. On Monday morning they finally announced the second DMSB review. The review reported no setbacks of SAE (serious adverse events) and recommended the trial continue as planned.

The stock topped out at $22.40 on Thursday before pulling back, and having a negative Friday today.

This was likely just a loss of steam, coupled with the earnings report that was released on Thursday. DVAX beat earnings estimates, but missed on revenue. Earnings doesn't mean much with DVAX because they have no approved products and are in the trial phase.

Price per share is currently $21.32 as of close today (03/06/15)

It has two near term catalysts:

There will be one more DMSB review. This is anticipated to be around June/July of this year. IMO, after passing another review, we're looking at a minimum of $30 a share.

According to their web site, they plan to initiate their SD-101 trial in middle 2015. This trial is for an cancer immunotherapy that will combine treatments with PD-1, that has already been approved. In Phase 1 trials, the combination has been proven to work better than with just PD-1 alone.

PD-1 is Merck's drug, which DVAX has had partnerships in the past with. So if the paired combination is successful in the future, I could see them possibly pairing again, or even being a takeover target.

I'm not going to mention the Asthma drug they're designing a Stage 2 trial for with AstraZeneca. That drug didn't meet primary endpoints, only secondaries, so I don't see that as a big deal. DVAX is only entitled to royalties on that one if approved, but the good news is that it's not costing them anything as AZ is funding the trial.

DVAX had $123M in cash at the end of 2014, with access to an additional $40M in credit based on Heplisav milestones.

Could be quiet on the home front for a while. Might even pull back a little bit in the short term, but over the long haul I'm looking to make some pretty good money.

Patience is a virtue. If you're willing to wait you should be rewarded in due time. I'll update again if anything newsworthy happens.

Thanks for reading. $21.32 as of today.

I'm going to amend my prediction. I was getting ahead of myself a few minutes ago.

After passing the third DMSB review I expect us to be at least $25 a share. Initiation of the SD-101 trial could push us to 30 around the same time.

If it doesn't happen by the review, I expect to see at least 30 around Sept/Oct as the market semi-prices in the Heplisav approval.

At that point, the risk averse should probably sell. The drug should easily pass and become the new Hepatitis B standard, but you never know with Wall Street politics.

There was a lot of DVAX action this week so I figured I'd give an update. On Monday (3/23) JP Morgan upgraded DVAX to "Overweight."  

By investopedia definition, overweight is either "A situation where a portfolio holds an excess amount of a particular security when compared to the security's weight in the underlying benchmark portfolio. " or

"An analyst's opinion regarding the future performance of a security. Overweight will usually signify that the security is expected to outperform either its industry, sector or, even, the market altogether."

They also revised their previous price target from $15 to $35. It was obvious that this needed to be done since the stock was already well over $15.

Due to this upgrade, DVAX went from $22.62 the previous Friday, to $25.06 by Monday's close. It continued strong momentum peaking $26.89 on Tuesday before the pumpers began dumping their shares and locking in their gains.

This is very normal in the biotech space for there to be high volatility and manipulation. DVAX was hit hard on Wednesday and Thursday, before making a small gain on Friday and holding it into market close.

As of Friday March 26, DVAX's price per share was at $22.70.

I just wanted to present what happened to the stock this week so people can understood the effects of good news on these things. Analyst upgrades, DMSB reviews, and trial initiations should be happening within the next 6 months and will be catalysts for the stock price.

I'm comfortable with making a projection of $30 per share by September, even before Heplisav approval. The retreat in share price gives investors another opportunity to get in at still lower levels for the ride up.

Again, as of this post (3/29) DVAX is at $22.70 for tracking purposes.

Hopefully you sold enough to at least get your initial investment back.

Train, this stock is my plan to get my life back after dumping years of savings through sports betting. I'm still pretty good at betting, especially if I pick my spots/situational plays, but my bankroll management is terrible. I gave it up altogether in Spring of 2013.

I have two years of savings into this company. It's a calculated risk that I decided to take about a year ago. I added to my initial position repeatedly in the 1.30-1.40 range.

IMO, the chances are relatively high that DVAX runs up to a minimum of $30, and probably $40 before Heplisav is even officially approved. It may even go to 50 as it has in the past.

Around August/September of this year I will consider selling in the 40-50 range and not leave my fate up to the FDA, but I will make that decision when the time comes.

That is my honest opinion about DVAX. I just didn't want to throw around numbers that people might think are wacky and make it look like I'm trying to pump and dump this thing.

So yeah, I'm holding strong for the foreseeable future. Just thought I'd share my decision with the board

DVAX is up 60% since my original post in November, so I've done pretty well.

I randomly checked my message box tonight and someone messaged me saying they would never buy this company because of the potential Hepatitis B market, which he caps at only $250M. His user name was "Pipe-Light," and he said he couldn't post in the thread cuz he's in the penalty box. 

He also accused me of having some hidden agenda, or knowing someone that worked there. Well trust me, if I knew someone that worked there and was getting inside info, I wouldn't be telling anyone.

Motley fool recently had an article about biotechs that you could sell 100% gains with. Dynavax was one of them. See link:

https://www.fool.com/investing/general/2015/04/19/3-stocks-that-could-double-your-money-2.aspx

They state that Heplisav B is projected to do $700M in peak sales. Not sure what that translates to, but it would appear that they would take most of the Hep B market if it was finally approved. He says someone else might beat them to it. Well they've been trying to get this drug approved for 10 years now. I'm not aware of any other competitors other than the product of choice right now by GSK. There are a lot of players trying to get into the Hep C space, but they are two completely different diseases.

Since biotechs often don't have approved drugs, they mainly just go up and down based on news. In the mean time, there is a lot of price manipulation that goes on.

I've noticed that DVAX has typically bottomed out around $22, then climbed back up into the 24-25 range. Today happens to be a day where it closed sub $22, so I figured I would post and let people know it's a good time to buy.

This is just speculation here. Could go up, could go down. This is a long term investment for me with great upside. Do your own research before deciding if you want to invest or not.

Will be back with further updates as necessary.

To Pipe-Light, I would have messaged you back to deny some hidden agenda, but you have disabled PM's to people that aren't your friends. I didn't feel like friend requesting you, because I only friend people on covers who provide information I find to be useful (in terms of betting on sports).

Price DVAX as of today is $21.99.

Just a quick update for you guys that have actually been reading my thread.

So like with most biotechs, DVAX moves pretty much only on news. Otherwise, it's just prone to daily manipulation. During the past 2 months it's gone down to as low as $18.50, before ending the same day at $19.50.

It's been hanging around the $20-22 range trading back and forth often on a daily basis. Usually 50 cent swings or so, before it ends up even, or up/down 20 cents.

As of today (6/29), the current price per share is an even $22. Even today, it was at $22.99 at one point, pretty much for no reason at all.

Anyways, just as a reminder, the Third DMSB review should be happening sometime in July. After it gets it's inevitable pass through without SAE (serious adverse events), it should see a decent boost. I'm so confident because during the last trial it passed this review as well. The only difference is the trial size is larger, and they're throwing in some patients with type 2 diabetes into it.

So if there is a dip in the next few days it would be a pretty decent time to buy some. I'm trying to add sometime in the near future before it passes the $25 mark.

I'll be back with another update after the DMSB review.

Again, the price of DVAX as of today is $22.00.  

P.S. The Safety Trial itself is likely to conclude around September/October. After that, they'll probably begin the process of applying for approval. I'm not sure how long that will take, but in the next couple of months the stock price should see some pricing in of the approval, especially after the third DMSB review that I just spoke about.

I just remembered that I left out a key bit of information as well.

The main catalyst for DVAX obviously is Heplisav, it's Hepatitis B vaccine. However, there are other drugs in the pipeline for down the road.

On June 1st DVAX entered into an agreement with drug giant Merck. DVAX has been developing an immunotherapy treatment named SD-101.

Merck has an immunotherapy drug called Keytruda that has already been approved. They also have an investigational drug named MK-1966 for immunotherapy.

Immunotherapies are the latest craze because they use your own body to fight off diseases. In this case, both DVAX and Merck's treatments are for cancer.

So earlier this month DVAX and Merck entered into an agreement to test their drugs together for efficacy. DVAX is funding the SD-101 Keytruda Trial, and Merck is funding the SD-101 and MK-1966 trial.

If they work well together the possibilities are endless. It would make sense for DVAX as a takeover target, but even if they stayed separate, having a big company like Merck on your team is a huge advantage.

They could assist in the launch of Heplisav after approval, or help fund other trials in the future.

That was big news, but surprisingly the stock didn't react too much to it other than on the day it was announced.

That's all for now. Be back with more news at a later time.

Reverse Splits many times can be disastrous. Although, I just had a R/S on NVIV and that has now been profitable. Most of the time they are not a good thing. R/M, however are considered the holy grail, at least in the penny stock market. In fact, PVSP is heavily rumored to be doing just that and if they do I will be retired at a very young age of 30! Best of luck with your stock sir

Today was a very nice day for DVAX.

The stock market tanked yesterday on Greece news but DVAX was unaffected and closed even.

While the rest of the market recovered today, DVAX went up a whopping 6.48% from $22 to $23.43.

I made a nice sum of money today, but I don't pat myself on the back too much because I know there is much more to come.

Make sure you get in before the third DMSB review because this thing will move quickly on the news.

Analysts at William Blair put a price target of $42 on it recently.

Just got back from Vegas today. Hit a pretty nice parlay and came back with more cash than I left with. I don't recommend parlays, but when you don't have much money left, it's a route that gives you a chance at winning decent amount if you can string together a few games, and a bit of luck.

Anyways, so I guess fund managers were really increasing their stake in DVAX the past 2 weeks knowing the same info that I was passing along here; that the third DMSB safety review was likely to come in July. So ever since June 30, DVAX had been going up pretty steadily.

On July 9th, the news of the third review finally came out. Heplisav passed the review, and the trial was recommended to continue unchanged, as expected. DVAX went from $24.42 to $26.44 that day.

DVAX has continued it's momentum, and gone up every day  since the news, closing at $28.21 today. That's a 95% gain since my original post in November when it was $14.46. I'm up around 116% myself since I had an average of about $13.00.

So in the short  term, I'm not really sure where DVAX is going. One would think it would test $30 in a near future, but there could be some manipulation to try and get cheaper shares .

In the longer term, the Heplisav trial should completed around September/October of this year. There shouldn't be any issues getting through that, as they already did this 2 years ago.

We should see additional gains, but the risk averse should probably get out after the spike when trial completion. If this goes to my original plan, DVAX should be high 30s (around $40) by then.

Personally, I think Heplisav finally gets approved this time, because they actually worked with the FDA to determine the trial size before they started this one. Still, I don't know if I trust the FDA, so that's why I think you should take your profits while you can after the trial completion spike.

I'm pretty sleepy as I'm writing this post and will update again in the near future. I just wanted to follow through on my promise to update after the third DMSB review.

For tracking purposes, DVAX is $28.21 at the time of this post.

Sorry it's been so long since my last update. I totaled my car, yet walked away relatively unharmed by the grace of god.

To make a long story short, I had been building a very significant stake in DVAX since 2012. Basically adding all my savings for years into it and waiting for trial data, and final approval of their Heplisav Hepatitis B vaccine.

About a year ago, I started playing with natural gas and crude oil with margin, and had been chasing the entire year. As you probably already know, natural gas and crude oil hit like 20 year lows recently.

Well as my oil and gas holdings were dropping like a rock, I constant margin calls. Basically my broker threatened to sell my stock if I didn't sell it myself to satisfy some minimum requirement.

I basically made them sell it every time, and every time they always sold my DVAX. This started in August, and I sold my last shares in the beginning on December.

So now I have 0 shares of DVAX. I sold them all at an average of $28.53 from a cost average of about $1.31.

Basically, by the beginning of December I had lost every penny to my name, plus another 10k margin balance.

But ever since they sold my DVAX, I've been saying I'm going to buy it back ASAP.

The phase 3 trial was completed around October, and they announced in November that the trial results would be reported in "early 2016."

Luckily, DVAX topped out during the summer and went down after I sold it. Since, then it's been trading between 24 and 28 for months.

Natural gas bounced back hard in the past 2 weeks, but I've only been able to make back about 20% of my bankroll since I started.

So anyways, this is the important post.

DVAX was $27 pushing $28 about 2 weeks ago. There was a biotech had 1 drug (like DVAX), and had a bad trial. That stock lost 80% of its value that day, and I think DVAX was taken down with it. That's what these biotechs can do.

Since that day, DVAX has been going down steadily. 

Today at one point it was down 12% today before coming back some at the end of the day. It hadn't been this low since June.

The stock market all went down today, and there's a lot of turmoil. So when the market seems like it's going to correct, people tend to hold onto their blue chips and lessen their exposure in speculative plays like DVAX. That is what I felt was happening today.

So it closes at $21.18 today, and immediately jumps up after hours....because.....

DVAX announced that tomorrow they are having a conference call at 8:30 AM ET to discuss the trial results.

So it's $23 right now after hours, and unfortunately I will not be able to buy back in.

Natural gas has bottomed, and I strongly feel it's going to go up in the next month or so.

Also, I can't risk it at this point. If there is bad news, I might lose half my value. If there is bad news, I will probably lose half of my account and be forced to liquidate everything I have left, plus be slapped with a margin bill that would be 3 years of savings.

So, take my commentary however you want it. The reason I invested so much in this company was because I thought it was as close to a sure thing that a biotech can be.

However, that was very peculiar movement today. To make a 7 month low and go down 12% the same day they announce that they're having a conference to discuss the trial results.

Also, from my limited experience, if the news is good, they typically just announce it. I've been on a couple of conference calls to discuss earnings before, and that's typically a bad thing. The president is about to announce bad news, but wants the investors to hear him out in order to perform damage control.

It also could be manipulation, and believe me the stock market is plenty manipulated, so big money could get their shares cheaper knowing the stock is going to pop tomorrow.

So take my information with a grain of salt.

I have no position anymore, and frankly I'm hoping the news is bad so it wasn't a missed opportunity.

But DVAX will make a 50% move tomorrow, whether up or down I don't know. If it's good, I imagine it will hit at least $30 a share. If it's bad, it will probably lose at least 30-40% initially, then probably keep going down from there.

If you're a gambling man, this is for you.

As of right now, you can buy DVAX after hours for $23.05.

So what I'd been saying the whole time came through. Because we did this safety phase before, and came back with good results (with a smaller sample size), it was inevitable that we would see similar safety results in this larger sample size.

Basically, in a direct test with its competitor Enerix-B, DVAX showed similar safety data, directly proportional to the amount of patients.

DVAX's Heplisav was nearly twice as successful with patients that had diabetes.

DVAX stated that they plan to submit their application for FDA approval by the end of the quarter in March. That's how far they got last time, before they were turned down due to too small of a sample size.

This morning the ask for DVAX was still sitting at 23.05, and even after the safety data was released around 7 AM, the ask on DVAX was only at $24!

By 8 AM it was at $28, and pushing $29. Then traders started profit taking. It dropped down to 25, back to 28, then started dropping heavily again with swing trades.

I couldn't believe it went as low as $23.50 today after releasing the safety data!

Didn't last long though. DVAX surged from there, eventually closing at $29.70. That is a 40.23% gain since the close yesterday.

So I'm not sure where it goes from here. Usually, the momentum carries for a while and it continues to go up, and eventually comes back down to reasonable levels.

Last time though, after good phase III trial results, DVAX almost hit the equivalent of $50 while waiting for FDA approval.

I'm hoping, and looking to buy back near the recent support area of $24.00. A lot of analysts previously had price targets around $38, and as high as $50

As of right now, DVAX is $29.70. Up 40% since yesterday.

The profit taking continued on Friday morning for DVAX. Despite being in the 30s in premarket action, DVAX steadily sold off throughout the day and ended at $26.70. That was a 9.8% decrease off Thursdays close after the 40% gain.

So this post will be one of my more opinionated ones. Normally I just tell it like it is, but this is just my opinion of the price action. Price action next week could change my mind entirely.

So typically when a company has good news, it can go up for several days in a row afterwards. DVAX had an immediate 10% haircut the next day as people came in and took profit. But can you blame them?

When I originally bought DVAX heavy at $1.00 a little less than 3 years ago (equivalent of $10, due to a 1-10 reverse split), the FDA had just denied their request for Heplisav approval.

They had already gone through phase 3 trials with great results. It was just that the sample size was too small according to the FDA. So DVAX and the FDA worked together to determine a sample size that the FDA would approve, and initiated a new trial. The new trial also would test patients with diabetes, and go head-to-head with the current standard treatment in Hepatitis B (GlaxoSmithKline's  Enerix-B).

This was not the first time DVAX's vaccine was denied, but I noticed that each time it was not approved, it would go down, but come back to the $30-50 area, even without approval.

DVAX has diluted the shares a couple of times in the past 3 years. Running a biotech bleeds cash while you're trying to get a product approved. Still, DVAX went from a $10 bottom 3 years ago, and peaked at $32 this summer before the Phase III trials even came out!

So general market weakness and profit taking took it back down to the low 20s. When it hit nearly broke $20 on Monday, DVAX execs had had enough, and likely pushed up their trial data announcement to prevent it from dropping into the teens. It worked.

On Thursday, the trial results pushed DVAX up from the previous close of $21.18, to $29.70. Shortly after Friday's bell, the profit taking started happening, and it accelerated throughout the day.

But how could you blame them? Those that bought in at $10-13 area had tripled their money! And DVAX is no further than they were 3 years ago!

3 years ago, DVAX passed phase III trials, and made it all the way to the FDA application stage without any hiccups. I don't think anyone expected they would fail a stage they had already passed 3 years ago, so Thursday's news was an absolute given. If you bought in at $10 like I did, it wouldn't surprise me if you  took your 200% gain and said thanks! See ya!