NaNoWriMo

Ever feel like you have the Great American Novel just bursting to get out of your brain? Take the plunge with NaNoWriMo - or National Novel Writing Month.

November is the month, and a novel is the goal. You "win" by completing 50,000 words within the calendar month of November, or 1,667 words per day.

Check out www.nanowrimo.org for details and to register. I am participating this year and will post about my progress at intervals.

Good luck to all who enter!
Best,
Trond

Port 24 update

I finally had a chance to revisit the Port, and spent a while cleaning it up.

MITI was bought out, CLSN and DCTH had reverse splits (boy do I wish I'd sold those prior to the mothball!) and a few calls expired worthless.

This morning I check out the prices of CLSN, DCTH, and PIP and "sold" them at the bid.
Just now I couldn't resist and picked up 2000 shares of VHC.

So the current Port looks like this:
Cash $27,780.30
1500 ARQL
1200 BTX
2600 CLDX
2500 CORT
1100 EXEL
7000 NNVC
6000 PPHM
1600 SGMO
2000 VHC
1800 ZIOP

Total worth (as of this moment) is $213,642.30.
That is a return of 113%, and annualized to about 16% over nearly seven years. Almost 4  of those years, the Post has been neglected to a sorry degree, too! Not bad.

I'll be more active now, and utilizing calls as usual to pick up additional income.

Good luck to all portfolios in the days ahead!

TED talk: Violence --> Poverty

I challenge EVERYONE to watch the 1 1/2 minutes from 10:57 to 12:27.

So I love to watch TED talks but my typical stance is, "Wait, this is 20ish minutes, I just can't spend that time when I don't know if this is WORTH it."

I'll summarize this, so you you can still be ejumacated without having to watch - although this one is worth the 22 minutes.
Poverty is created by, and sustained through violence, in cultures where the concept of law enforcement is spotty. And our own is NOT immune. See the challenge above.

Two impactful quotes:
"Most poor people live outside the protection of the law."
"People don't know how to fix the problem, so they don't talk about the problem."

http://www.ted.com/talks/gary_haugen_the_hidden_reason_for_poverty_the_world_needs_to_address_now#t-609414

Nimrud destroyed

"The Art Newspaper considers it “the greatest single cultural loss since the Second World War,” while Irina Bokova, the director general of UNESCO, condemned “this mad, destructive act that accentuates the horror of the situation,” in a statement while equating the destruction to a war crime."

http://www.thedailybeast.com/articles/2015/04/14/how-isis-reduced-the-ancient-world-of-nimrud-to-rubble.html

Ridiculous. What a waste of oxygen. 'Nuff said.

ARNA

Longtime readers know I have been a fan of Arena for years.

I am absolutely unhappy with the stock price and have been for years. They were screwed over by the DEA for not getting it scheduled for almost a whole year after Belviq's approval. That killed a lot of momentum. The attitude of doctors for "diet and exercise" and avoiding a pill hurts too, but that is slooooowly changing.

Today's price is about $4.55. And although I am still a fan of the company, I don't see blockbuster price moves soon. So I would be comfortable with selling calls against a position at this point - I want to be long the stock but I think July $5s (if you can get $.35 for them) sound about right. Maybe even the Oct $5s, with the idea of buying them back with some probable summer volatility). On the first you get almost 8% return for 3 months, with another 9% if exercised (all minus commission, of course).

2-5% a month, on a "boring" stock. :-)

Income taxes

It's that time of year, and of course I rebel against the amount due sometimes.

We obviously (or maybe not so obviously, if you are hard-core Libertarian?) need some method of raising revenues for the government juggernaut to roll. Where you fall on the graduated vs. flat tax debate probably depends on your income level.

One of the other major alternatives tossed around always seems to be a consumption tax instead of an income tax. The upside to this is that you are not taxing the creative/industrious efforts but instead raising revenues from people spending the money. The downside is that our entire economy is pretty much based on the urge to spend, spend, spend. Putting the brakes on that would tilt the entire economy and it would probably take years of fine-tuning to "get it right," whereas there probably would be a very volatile economy in that interim.

Hmmm. Maybe the libertarians have a point...

Port24 revival

I will be taking the Port out of mothballs soon.

Fortunately the stocks I'd selected were smaller biotechs, for the most part, that need years to come to fruition. I need to review the last few buys and sells to make sure I have the positions current, then will be posting where I'm at.

As a reminder, the Port24 is a fictitious portfolio, started with $100,000, a target of 24% returns per year, and hopefully demonstrating the power of smallcaps combined with covered calls. I think I was averaging around 18%+ a year for quite a while and it will be interesting to see where I'm at with the neglect of over two years.

Writing contest

Like I recently said, I am back in the saddle, writing.

This is a cool little new site, that allows one to write and then (online) publish their works. They have had a few monthly contests and I was very excited to take second place in the March "Running Scared" short story horror contest.

http://www.inkitt.com/anotherworld

The current contest, which just started and runs through May 5th, is "Echo of Another World." It is a short story contest for sci-fi/fantasy and in honor of the late Sir Terry Pratchett.

Wall of worry

"This past month may be remembered as the moment the United States lost its role as the underwriter of the global economic system."

http://finance.yahoo.com/news/larry-summers-past-month-may-121922702.html

So we have heard this kind of thing before. Part of me thinks it is a planned theme from the government and quasi-governmental think tanks over the next 12 months to harp on these kinds of thing to try to let some steam out of the stock market. We are pretty much at all-time highs on all fronts, interest rates are still low, and business is still clicking along with unemployment down to a 5.5% rate.

My biggest worry? The "sell in May" story. Stay tuned...

Back in business

There have been some life changes!

I am no longer in business as a financial planner, or portfolio manager. This simplifies my life considerably, now that I no longer have to worry about compliance.
I am still going to talk stocks, personal finance, markets. But I am going to offer much more commentary on society and life issues as well.

I find myself writing again. Stories, poetry, this blog, and more. Writing is something I find myself enjoying again.
I once again invite you, "Come join the fun."

Comments, as long as they fit one out of these three categories, are encouraged:
Honest
Funny
Polite

I reserve the right to remove comments where I deem it warranted.

ZIOPharm (ZIOP)

ZIOPharm is a biotech in the cancer space, with an important trial expecting data in the last week of March 2013.

PICASSO 3 is a phase 3 trial in soft tissue sarcoma, using ZIO-201, or palifosfamide. Pali, for short, is also being tested in a phase 3 trial for non-small cell lung cancer (NSCLC) with data nearer the end of the year.

They released news this morning that Indiana University has sponsored and initiated a phase 2 trial in recurrent metastatic germ cell (testicular and ovarian) tumors, using pali also. Since the lead investigator here is the same Doctor who leads the NSCLC trial it bodes well of him using the University's time, money, and prestige in bringing this phase 2 there.

ZIOP also has some interesting drugs in their pipeline, albeit most of them are much longer term propositions. Right now, this truly is a play on the PICASSO 3 trial.

While I am cautiously optimistic on its success there, biotech is not for the faint of heart! With the stock closing yesterday at $4.74, I am looking for a runup to the mid $5s in the next two weeks. If PICASSO 3 comes in sucessful I'd like to see the price hit somewhere around $7-8. And conversely, with failure I would expect a price of around $3, although rebounding over the summer to current levels due to the NSCLC trial, and pipeline, potential.

Best,
Trond Hildahl

** This is presented for educational and informational purposes only, and should not be construed as personalized legal, tax, investment, or financial advice. My own resources, risk tolerance, and personal situation have been taken into consideration for any trades mentioned and should not be used as a basis for someone else's trades. Stocks may lose value and this is not recommendation to buy or sell this particular issue. **

AcelRx has a Good Day

News from ACRX tonight:

PR

AcelRx, in brief, is into pain. No, not Mr Grey-type pain, but the relief of such. Their NanoTab sufentanil system is a pill that melts under the tongue and is like morphine on steroids. And the device that delivers it allows the patient to safely self-dose when needed and yet prevent overdosing and drug-theft.

They already proved last November that this drug is non-inferior to morphine and the company has a third phase 3 trial that will wrap up in the 2nd quarter this year.

I'll be listening to the conference call tomorrow morning, and expect a "sunny" day share-price-wise.

Good luck to all ACRX owners.

Best,
Trond Hildahl

** This is presented for educational and informational purposes only, and should not be construed as personalized legal, tax, investment, or financial advice. My own resources, risk tolerance, and personal situation have been taken into consideration for any trades mentioned and should not be used as a basis for someone else's trades. Stocks may lose value and this is not recommendation to buy or sell this particular issue. **

VirnetX (VHC) and Uni-Pixel (UNXL)

Good morning!

Last night, VHC received the final judgment in its court victory against Apple from last November. The jury award of $368M was confirmed, along with daily damages that total about another $18M+. Their request for an injunction (yes, an injunction against the iphone4 (!) amongst other products) was denied. The parties were ordered into mediation within 45 days to come up with a license for royalties – or else the judge will impose one. All in all, a clear win for VirnetX AND the trial against Cisco starts in two weeks – on the same patent suite, in front of the same judge who oversaw victories against Microsoft and Apple, and who used to be a software engineer.

Add to that this morning the USPTO reviewed and confirmed several core patents that VHC holds.


Uni-Pixel makes touchscreens and films that may represent an order of magnitude improvement in cost and flexibility for Original Equipment Manufacturers (OEMs). They have signed several agreements and licenses in the last few months (including Texas Instruments and an unnamed “major PC maker”).

The company had its 4Q12 earnings call last night and I expect good things for all of 2013 from this company. They are ramping up to production mode and have $5M in pre-orders already. Wall Street seems to be cheering them on today, with the price up 23% to the $23+ level.

Excellent news from both.
Best regards,
Trond Hildahl

--This is presented for educational and informational purposes only, and should not be construed as personalized legal, tax, investment, or financial advice. Stocks may lose value and this is not recommendation to buy or sell this particular issue.

Flip-flop on Celsion

It is no secret that I was an outspoken bull on Celsion for the last three years.
While I have quite a lot of sympathy for current shareholders, I personally am 100% out of the stock right now. I had a good exchange with a current bull, and thought it would make the basis for an interesting post.

---

Most important, first:
>>did you flip around and go short?

Nope - I never short.
At the absolute most if I am quite certain of a decline I'll buy puts. Don't *like* the idea or process of shorting - too many problems/games that can be played but I guess this is not the time or place for that. [TH - I have PLENTY of posts here over the years to illustrate my issues with shorting]

>>Did you ever consider that PFS in the control group as a whole was 14.4, BUT what if it is less in other subsets? Such as China's 200 patients? What if PFS in the China subset is only 12?

I considered it, and here's my take:

We had very convincing arguments that we'd be golden if PFS came in anywhere under 17 months or so. (Perhaps you'll recall that although I was extremely bullish my own continued mantra was we should expect around a 14:24 PFS. My control arm projection was almost spot on - but with "not even close" we obviously made some kind of dreadful miscalculation of the hazard ratio.)

So given that 14.4 wasn't close, I hold out very diminishing hopes that even a clear subset at 12 would have been stat-sig.
Add to that, that for a 200 patient subset to achieve 12 when the overall was 14.4, the ex-Chinese group would have been even worse than 14.4.

And the DMC at interim did not halt for failure, which if we weren't close at 14.4, with a subset of ~500 out of 600 at the time showing a 15+ PFS ... I propose that such a situation simply couldn't have happened.

And finally:
>>They will not go bankrupt. They have a lot of cash now, 2 ongoing trials, RCW is VERY promising, and probably what they should have focused on in the first place.....

You are right, BK is not going to happen. But massive dilution has happened, and that cash will disappear faster that you might think. ABLATE is only 80?? patients but they were slow to enroll to conserve cash for HEAT results. Gearing up now cost $. And that is ph2, which they were depending on good HEAT results to allow off-label. By itself ABLATE is not registrational. More money needed! And if you'll recall, even the BS BiotechSage admitted HCC ph1 looked decent and it was MLC and distant mets that posed the problem.

I agree that RCW may be the best shot. But they took ... so ... long ... to enroll even the ph1, I don't see the larger ph2 finishing with results anytime before 2016.

I put a HUGE amount of time, attention, and DD into the bull case. But I am always cogent about what might happen and once the "unthinkable" happened then I have to put credence in the bear case until proved wrong (again). The reward is definitely there, at this price, but the risk is, in my opinion, much worse.

GLTY
Trond

---

So there you go. I followed my principles and took my basis out in the $7s and $8s, but for three years, and the time and effort I put into this, I am not sure I "got my money's worth" here. Another lesson in the minefield called biotech.

Best,
Trond Hildahl

** This is presented for educational and informational purposes only, and should not be construed as personalized legal, tax, investment, or financial advice. My own resources, risk tolerance, and personal situation have been taken into consideration for any trades mentioned and should not be used as a basis for someone else's trades. Stocks may lose value and this is not recommendation to buy or sell this particular issue.

Those Friendly Banks

So I’m listening to the radio as I tool around town.

Chase Bank has a new prepaid debit card they are offering – the Chase Liquid.
The announcer is all breathless because you won’t get socked with ANY extra fees – all you pay is one low monthly fee – which I later investigate and find to be $4.95. Keep in mind you can load as little as $25 on it – at least they’re keeping fees under 20% a month!

It’s a full one minute spot, and I swear that at least 30 seconds are devoted to a reiteration that other fees are despicable and unnecessary and highly frowned upon.

And at the end … the fast-talking fine-print guy adds, “Other fees may apply.”

Aintcha glad those Big Banks are looking out for us?

Celsion and Oncothyreon

Celsion still is a good investment thesis.

If you have not heard, Oncothyreon had a failed trial this morning and had the share price cut by more than 50%. As a disclosure, I had no position in ONTY but was in it a couple years ago for the continue at the first interim. I do have a lot of friends and colleagues who were in it, some quite heavily, and they are hurting quite a bit this morning.

Celsion has had a number of people who are bullish because of models showing the trial “is running longer than it should, thus it must be doing well.” ONTY, as numerous trials have before this, should serve as a wake-up call to these investors. Fortunately, Celsion’s Thermodox has a plethora of features that allow me to be “watchfully bullish.”

For one, the method of action (MOA) is pretty clear.
Reviewing the concept in extremely basic language, Thermodox is the chemo doxorubicin, covered by a fatty layer. That fatty layer is engineered to be attracted to the “leaky” blood vessels that are found most prominently in tumors. So after Thermodox is infused into the patient, these entities congregate around tumors. When radio-frequency ablation (RFA) occurs, burning away the cancerous tissues, that fatty layers cracks open (it has been compared to a hexagonal soccer ball) and releases the doxorubicin, bathing the tumor and surrounding tissue in the chemotherapeutic agent.
Doxorubicin does two extra things germane to this process:
Its cell-killing activity is heightened by heat. Thus it’s even more effective than normal.
It lowers the temperature of the surrounding tissue. This means heat-activated ablation is more effective, especially in the margin areas that otherwise would not be completely ablated.

Importantly, both RFA and doxorubicin are known processes and drugs, with a familiarity by doctors and the FDA.

I question the models that show the trial is “going long.” We are actually on the schedule put out by management in the prior year. Enrollment took a heck of a lot longer than anyone initially thought. And HCC is a wide-open kind of cancer, where many issues interact and no patient can be said to be “average.” The size and number of tumors, where they are located, and general health (otherwise to the cancer!) all have a lot to do with their prognosis. While generally speaking the median progression-free survival (PFS) should be around 12 months for the RFA-only group in the trial, the clinical sites are at some of the most skilled RFA-practitioners in the world. Patients who are in clinical trials tend to have better outcomes, due partially to the placebo effect, to the improved follow-up care and also simply by the desire to live as evidenced by being willing to enter a clinical trial. I will not be surprised to see PFS for the placebo arm come in higher than 12 months.

The Japanese firm Yakult partnered with Celsion a couple years ago, and before partnering you can be sure they got a peek at the preclinical and other available Thermodox data. At the beginning of 2011 Yakult elected to pay an extra couple million dollars upfront in order to receive a lower-than agreed royalty rate going forward. I cannot imagine how that can be spun as anything but positive. Philips Healthcare has partnered with us using their high-frequency ultrasound (HIFU) technology at the heating mechanism in lieu of RFA. They are paying trial costs, which is a reasonable (and bullish) commitment, also having seen private company data. I think it fair to propose that preclinical and ph1 data are reasonably strong.

The most “squishy” factor to consider is the insider buying. Several officers and directors have recently bought shares on the open market or exercised options or warrants. As a reminder, this takes real money, either straight up or as “income” defined by the IRS, and so it is coming out of these folks’ disposable income. As the old saw goes, insiders can sell for many reasons, but there is only one reason for them to buy.
Alongside that, we need to look at the company’s refusal to do a financing prior to data, and in fact their reiterated commitment NOT to do so very recently. This is pretty much unheard of, and very bullish. Let me be explicit here – the insider buying and no-raise factors are bullish but these people do NOT have much more insight into the trial than investors do. They do not have unblinded info from the interim look, they don’t get “winks and nudges” from the Data Monitoring Committee (DMC), and they cannot trade if they did know such things. But they are the closest to the data and such actions should at least be acknowledged.

In sum, I feel Celsion at a sub $300M market cap is undervalued and eminently tradable. I think the HEAT trial has a very reasonable chance of success and have a 2-month target price of $20.

Disclosure and disclaimer:
I own shares and option of Celsion at the time of this writing and while my positions may change, I have no intention of doing so within three days of this article. My own resources, risk tolerance, and personal situation have been taken into consideration for any trades mentioned and should not be used as a basis for someone else's trades. Stocks may lose value and this is not recommendation to buy or sell this particular issue.
This is presented for educational and informational purposes only, and should not be construed as personalized legal, tax, investment, or financial advice.

Arena wins approval

The FDA, as I expected, approve Arena's drug today, following last month's 18-4 Advisory Committee positive vote. The drug will sell under the name Belviq and is for weight loss - the first such drug approved in the last 13 years. The full release can be viewed here: http://finance.yahoo.com/news/arena-pharmaceuticals-eisai-announce-fda-171300471.html Congratulations to any who were long here. I believe the fun is just getting started. Best regards, Trond Hildahl

Return to 1981?

Very nice and succinct summary of why history cannot repeat itself right now. http://markdow.tumblr.com/post/24081371136/reagans-gone-youre-old-get-over-it Which reads in part: "The world of 1980 had tons of pent-up demand and gale-force tailwinds. Inflation and interest rates were coming down from high levels, household leverage was very, very low, financial innovation non-existent, consumption had been deferred, and demography was coiled as the baby boomers were just coming on line. On the government side, unions were powerful, price and wage controls were a reality, and tax rates were high. This was the ideal set up for supply side reforms. "Fast-forward to post-2008. Whatever the opposite of pent-up demand is, that’s what we have. Inflation and interest rates are already low, household leverage is a major burden, consumption was pulled forward during the boom, and demography is no longer our friend. Plus, we have globalization acting like a supply shock to our labor pool, holding down wages. In short, the tailwinds are now headwinds. On the government side, unions are far less powerful today, there are no price and wage controls, and tax rates are low. It seems next to impossible to make the case that supply-side policies can have anywhere near the effect today that they had in the 80s." Trond out. Pool, here I come.

Arena (ARNA) garners positive Advisory Committee vote

A couple of years after it should have occurred, but ARNA got a 18-4-1(abstain) thumbs up from the FDA's Advisory Committee today. The company's weight-loss drug Lorquess is up for approval. The stock nearly doubled to $6.85 after opening for trading in after hours - it was halted during the Committee meeting and vote. The actual approval decision is not due until June, but expect fireworks over the next couple days. Congratulations to the longs (of which I happen to be a member in my personal accounts) and to the company. Regards, Trond This site is for educational and informational purposes only. Nothing contained here should be construed by anyone as an invitation or solicitation to buy or sell any security. This site does not contain personalized legal, tax, investment, or financial advice. Users of this site should consult with a qualified adviser to obtain advice suited to their personal circumstances.

Celsion thoughts

I was asked the following question about Celsion raising more money prior to getting results from their HEAT trial....

>>Do you have an opinion on whether they would hang ten on cash until after the HEAT readout?

I was blindsided by the raise immediately after the interim results. That one-two punch really killed us, and only the specter of the 2nd intermi look was what was keeping us above $1.75.

It kind of blows my mind that we're this low - even if we're 7-9 months out. But it is what it is.

I feel fairly confident that as the summer draws nigh, we'll pick up some analyst coverage - and while they may be positive or negative, we're almost sure to add some, "IF they get good results, then my target is $XX" statements. Keep in mind the three targets we have, ($6, 7, and 10 IIRC) all were assuming a continue at interim. So we are so far below those targets it's not even funny (or at least my accounts are not laughing). We do have target reiterations to look forward to, as well as China completing enrollment, DIGNITY/ph2 starting, more ABLATE news, the mysterious product #4, Yakult news in Japan, the ever-present chance of a partnership or buyout, and the clock is always winding down towards Q4 and the 380th event. Today may not be the lowest price we'll see, but odds are in our favor to start a climb upwards - you just need to be patient.

All that does not answer the question, "Do you have an opinion on whether they would hang ten on cash until after the HEAT readout?"

They have been both aggressive and safe at times. Last summer, they starved themselves of cash to see if they could make it through the interim, and then they also raised at the worst possible post-interim time. It would not surprise me to see a raise at any time, but my opinion is they will not do so in the next two months. Once we have a handle on DIGNITY andf ABLATE costs in the next quarters' numbers, I might change my mind! And of course, when the price does get some traction, that begs the company to raise a little.

It probably comes down to how close they really are in partnership talks. Right now, they are fine for cash. Projecting out for 5 quarters, after thinking about the trials going on, we'll definitely need some more. Does it change things that we should *know* HEAT results exactly one year from now? Uh, yeah. So final thought is again the partnership side of things. If they can sign one more regional agreement for Thermodox - only (China, or Europe) and grab a $4M up-front payment, then I think a further raise can wait until we're at the final (and the price should be above $3).

Best regards,
Trond

Disclaimer:
This is presented for educational and informational purposes only, and should
not be construed as personalized legal, tax, investment, or financial advice.
I am long shares of Celsion in my personal accounts, but my holdings are based on my own risk tolerances and situation.