As January wound to a close, the most notable insider purchases were in biopharma companies, particularly those with initial or secondary offerings of stock.
A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.
Remember that with the earnings-reporting season underway, many insiders are prohibited from buying or selling shares. Below are some of the more notable insider purchases that were reported in the past week.
Gilead Sciences Bolsters Arcus Biosciences
- Buyer(s): 10% owner Gilead Sciences
- Total shares: more than 15.2 million
- Price per share: $21
- Total cost: nearly $320.0 million
This transaction is related to the amendment of a collaboration agreement between cancer-focused biopharmaceutical company Arcus Biosciences Inc. (NYSE: RCUS) and biotech giant Gilead Sciences Inc. (NASDAQ: GILD). Arcus shares have tumbled about 17% year to date and were last seen trading for less than $16 a share, below the purchase price above. However, analysts on average recommend buying shares, and their consensus price target of $39.70 suggests that the stock could more than double in the next 12 months.
Buying Into ArriVent BioPharma’s IPO
- Buyer(s): 10% owner Hillhouse Investment Management and two directors
- Total shares: more than 1.4 million
- Price per share: $18
- Total cost: shy of $18.0 million
ArriVent BioPharma Inc. (NASDAQ: AVBP) is a cancer-focused biopharmaceutical company that has just come public. Shares of this Pennsylvania-based company were last seen changing hands near $22 apiece, above the initial public offering price. The buyer has a stake of almost 4.5 million shares. Also note that one of the directors, whose stake is about 1.5 million shares, also purchased shares of Adicet Bio (see below). (Here are 20 early, common, and vague signs of cancer.)
CG Oncology Goes Public
- Buyer(s): 10% owner Decheng Capital Global Life Sciences Fund IV and others
- Total shares: less than 666,500
- Price per share: $19
- Total cost: more than $12.6 million
These insiders, including the chief financial officer and chief medical officer, bought into the upsized CG Oncology Inc. (NASDAQ: CGON) IPO. Shares of this California-based biopharmaceutical company were last seen trading well above the IPO price at nearly $38. The post-IPO price range is $28.55 to $40.90. Investment firm Decheng Capital is also based in California and provides capital and strategic support to early-stage life science companies with revolutionary technologies.
Corbus Pharmaceuticals Flying High
- Buyer(s): 10% owner Cormorant Asset Management
- Total shares: more than 282,600
- Price per share: $26.14 to $38.98
- Total cost: over $9.1 million
Corbus Pharmaceuticals Holdings Inc. (NASDAQ: CRBP) received some good news from the FDA last month that sent shares soaring. The stock is up around 360% year to date to $27 or so, which is within the buyer’s purchase price range. The Boston-based investment management firm’s stake is 725,00 shares, and note that it recently picked up shares of EyePoint Pharmaceuticals Inc. (NASDAQ: EYPT) as well. Analysts see plenty of room for Corbus stock to run, given their consensus price target of $85.50. Their consensus recommendation is to buy shares.
Big Upside for Adicet Bio?
- Buyer(s): a director
- Total shares: more than 3.1 million
- Price per share: $2.40
- Total cost: $7.5 million
Boston-based biotechnology company Adicet Bio Inc. (NASDAQ: ACET) also had a public offering of stock. The stock is up more than 127% since it posted quarterly results back in November. However, it is still down about 67% from a year ago and was last seen trading near $3. That is above the stock offering price. The director’s stake is up to more than 7.5 million shares. The $15.17 consensus price target indicates that analysts overall see more than 400% upside in the next 12 months. The shares last traded that high in late 2022.
Vera Therapeutics Under New Management
- Buyer(s): a director
- Total shares: almost 161,300
- Price per share: $31
- Total cost: nearly $5.0 million
The recent appointment of a new chief medical officer and chief development officer boosted Vera Therapeutics Inc. (NASDAQ: VERA) stock. Shares of this California-based biotech company are up almost 39% year to date and trading near an all-time high of $39.62. The director took advantage of a secondary offering to boost her stake to more than 3.6 million shares. The consensus recommendation is to buy shares, although the stock has overrun its consensus price target.
And Other Insider Buying
In the past week, some insider buying was reported at Cleveland-Cliffs, Illinois Tool Works, Intel, Kimberly-Clark, Mobileye, and Walgreens as well.
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