Despite a rough day in the market over fears that the Federal Reserve may raise interest rates and thus induce a recession, biopharmaceutical startup Iovance Biotherapeutics (NASDAQ:IOVA) stock shot up, completely against the grain.
Catalyzing robust sentiment toward Iovance was a dramatic example of insider buying. Specifically, the company’s director Wayne P. Rothbaum increased his stake in the firm by picking up 10 million shares. This transaction amounted to a total value of $65 million, per TipRanks.
Interestingly, the site notes that Rothbaum enjoys a 100% success rate with his two transactions in the past three months. The average return stands at nearly 40% per transaction. Presently, the director’s position in IOVA stock pings at $115.8 billion.
Though a small sample size, Rothbaum’s acquisition will likely hearten speculators seeking stout upside opportunities in a growth-starved environment. As InvestorPlace contributor Will Ashworth stated, “[t]here are many reasons why insiders sell a stock. There’s only one reason they buy, because it’s cheap.”
Adding to rising sentiment, analysts appear enthused about IOVA stock. According to Barchart, in the current month, Wall Street experts rate Iovance as a “strong buy.” This assessment breaks down as 10 strong buy and three hold ratings.
IOVA Stock Also Enjoys Longshot Fundamental Catalysts
Aside from the insider transaction, longtime stakeholders of IOVA stock focused on lifileucel, Iovance’s key drug for patients with advanced melanoma. As a study published in the National Library of Medicine noted, “[e]ffective treatment options are limited for patients with advanced (metastatic or unresectable) melanoma who progress after immune checkpoint inhibitors and targeted therapies.”
However, “[a]doptive cell therapy using tumor-infiltrating lymphocytes has demonstrated efficacy in advanced melanoma. Lifileucel is an autologous, centrally manufactured tumor-infiltrating lymphocyte product.” Additional research demonstrated that lifileucel generated positive clinical data in patients with advanced melanoma, boding well for IOVA stock.
Currently, the Food and Drug Administration (FDA) is seeking additional information regarding Iovance’s request for a new drug application for lifileucel. Although not a rejection by any means, the matter could prolong the approval process. Based on the latest information, Iovance could file the necessary documents by the first quarter of next year.
According to the American Cancer Society, approximately “99,780 new melanomas will be diagnosed (about 57,180 in men and 42,600 in women). In addition, “[a]bout 7,650 people are expected to die of melanoma (about 5,080 men and 2,570 women).”
From an investment perspective, the challenge centers on convincing market participants to take an extended shot with IOVA stock. Since the start of the year, shares have plunged nearly 57%, reflecting longer-term obstacles.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
