Insider buying and selling activity is something that we believe can offer a significant amount of 'signal' in the Canadian small/micro cap markets. Insiders are always long on their company's shares one way or another, so when they choose to trade their cash for more of their company's paper it is worth making note of. Every few weeks, MedicalGold.ca will publish an Insider Activity List highlighting the Canadian biotech/pharma stocks that experienced the largest insider buying and selling.
We will also be keeping tabs on the performance of the companies highlighted in these posts to see how they perform over longer time periods, and perhaps more importantly if a trend of insider activity begins to develop. Occasionally, we will also highlight unusually aggressive insider selling activity as heavy insider selling has a history of preceding large share price declines in micro-cap stocks.
As always, our aim will be to provide valuable signals and we will also overlay a fundamental context in addition to technical analysis of company charts.
Satellos (TSVX:MSCL) is a publicly traded biotechnology company dedicated to developing life-improving medicines to treat degenerative muscle diseases. Satellos has incorporated breakthrough research in muscle stem cell polarity into a proprietary discovery platform, called MyoReGenXTM, to identify degenerative muscle diseases where deficits in this process affect muscle regeneration and are amenable to therapeutic intervention. With this platform, Satellos is building a pipeline of novel therapeutics to correct muscle stem cell polarity and promote the body's innate muscle repair and regeneration process. The Company's lead program is an oral, small molecule drug candidate in development as a disease-modifying treatment for Duchenne muscular dystrophy. Satellos is headquartered in Toronto, Ontario.
The company recently completed a $55M financing led by some big institutional players: Avidity Partners, Qiming Venture Partners USA, Perceptive Advisors, Soleus Capital, FMB Research, Allostery Investments and other leading healthcare specialized institutional investors.
Satellos' core technology is a completely novel approach to treating Duchenne muscular dystrophy (DMD), which has historically focused on the dystrophin protein that gives muscle its structure. Mutations in the gene result in muscle wasting and other life-threatening complications in young children. DMD is in the spotlight as the FDA reviews Sarepta's new dystrophin-targeting drug, and Satellos may benefit from a new approval that catalyzes interest in the space.
Director Bill Jarosz invested $620,000 in the company's latest financing. This is his bio:
"William Jarosz was the Chief Executive Officer of iCo Therapeutics, Inc. from 2020 until 2021 and currently the President of Satellos’ subsidiary Amphotericin B Technologies, Inc. He is currently a Founding Partner at Cartesian Capital Group, LLC, a global investment management firm. From 1997 until 2005, Mr. Jarosz served as Managing Director and General Counsel of AIG Capital Partners, a subsidiary of American International Group, Inc., and as Managing Director of the AIG- Brunswick Millennium Fund. While at AIG Capital Partners, Mr. Jarosz oversaw global private equity transactions for the firm’s various private equity funds. Prior to joining AIG in 1997, Mr. Jarosz practiced law at Debevoise & Plimpton, specializing in international private equity investment and Russian corporate and securities laws. Mr. Jarosz also served as a consultant to the World Bank on the regulation of Foreign Direct Investment in emerging markets. Mr. Jarosz is a graduate of the University of Montana and received an MA in Law and Diplomacy from the Fletcher School at Tufts University, and a JD from Harvard Law School."
After a more than 300% rise from December through April, Satellos shares have corrected back to the rising 50-day moving average. Daily stochastics are oversold and the $.50 level should continue to represent strong support after MSCL recently completed a large financing at this level.
PharmAla Biotech (CSE:MDMA), formed by a team of biomanufacturing and regulatory experts, is the first public manufacturer of GMP-grade MDMA and a leading drug developer of novel, proprietary MDMA analogs. Driven by the evidence that MDMA presents excellent clinical promise as a treatment for numerous mental disorders, their core mission is to advance the scientific research directly related to the medicinal use of MDMA by providing researchers and clinicians with a steady and accessible supply of clinical grade drug. While the base MDMA compound has shown positive results in clinical trials for PTSD, PharmAla also believes that the therapy can be improved upon by augmenting the molecules’ safety and pharmacological properties to treat a diverse range of disorders. With this in mind, the company is dedicated to developing MDMA analogs (called “MDXX” compounds) and has already filed patent applications for six of these new chemical entities.
Read MedicalGold's analysis of PharmAla
A company we recently highlighted, Pharmala Biotech (CSE:MDMA), has had some notable insider selling as COO Shane Morris took profits on some deeply in the money $.05 options. Pharmala continues to be in one of the strongest uptrends in the entire Canadian microcap biotech space.
Author does not own shares of Satellos, PharmAla, or Sarepta at the time the article was published, and has no relationship with any of these companies.
The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. This publication is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions. Junior resource and biotechnology companies can easily lose 100% of their value so read company profiles on www.SEDAR.com for important risk disclosures. It’s your money and your responsibility.