When the Chief Scientific Officer of a biotech company buys  $1 million of his Company’s stock, normally stock traders take notice. Not here.  Joshua Hare made an open market purchase of 103,000 shares of Longeveron at $9.98 on the Company’s IPO.  Within a week, he’s down a stunning 38%. Longeveron has been one of the worst-performing IPOs in one of the strongest markets I’ve ever seen.  Is Aging Frailty just a hoax? Another one of the live forever theories promulgated by aging billionaires.  The answer to that really won’t matter. If the FDA approves something for aging frailty it will be a blockbuster.  Just like on the HBO show Silicon Valley where the aging tech magnates are transfusing themselves with the blood of young techies they hire.   It reminds me of something Oscar Wilde opined in his 1889 essay The Decay of Lying that, “Life imitates Art far more than Art imitates Life.

Before you get too skeptical about all of this, look at this video from 2018 when the founder Dr. Hare pitches his company.  Then check out this academic article from the Journals of Gerontology. If you’re over 65, you might just want to sign up for the drug trials.  And last but not least his bio on his website doesn’t do him justice.  Read this one instead.  

Last and most importantly, YouTube has a number of videos of Dr. Ware.  It’s obvious this is a serious scientist who has devoted his life to this work.

LGVN is a clinical-stage biotechnology company developing cellular therapies for aging-related and life-threatening conditions. Their lead investigational product is Lomecel-B™, which is derived from culture-expanded medicinal signaling cells (MSCs) that are sourced from bone marrow of young healthy adult donors.  They believe that by using the same cells that promote tissue repair, organ maintenance, and immune system function, we can develop safe and effective therapies for some of the most difficult diseases and conditions associated with aging.

So what’s wrong with this picture? A lot of people believe in the regenerative power of stem cells, including doctors and scientists although there is plenty of skepticism too. You won’t find any major health insurance companies that will pay for stem cell treatment.  It doesn’t help either that the FDA has a warning on their website about stem cell treatment.

According to the FDA, “There is a lot of misleading information on the internet about these products, including statements about the conditions they can be used to treat. FDA is concerned that many patients seeking cures and remedies may be misled by information about products that are illegally marketed, have not been shown to be safe or effective, and, in some cases, may have significant safety issues that put patients at risk. There is only one approved use for stem cells. Currently, the only stem cell products that are FDA-approved for use in the United States consist of blood-forming stem cells (also known as hematopoietic progenitor cells) that are derived from umbilical cord blood. These products are approved for use in patients with disorders that affect the production of blood (i.e., the “hematopoietic” system) but they are not approved for other uses.”

So is LGVN, just another stem cell company that sucks up investors’ money, or is it another Cassava Sciences, just waiting for the first hint of efficacy on Alzheimer’s? Joshua Hare cofounded Longeveron in 2014.  He is a serious dude so I want to keep an open mind about this company.  Dr. Hare co-founded Longeveron in 2014 and serves as Chairman of the Board of Directors and Chief Science Officer. Dr. Hare is a double board-certified cardiologist (Cardiology and Advanced Heart Failure and Transplantation) and is the founding director of the Interdisciplinary Stem Cell Institute at the University of Miami’s Miller School of Medicine. He has obtained in excess of $25 Million in funding from the National Institutes of Health over the past 15 years to support basic research of cell therapy strategies. He is also a recipient of the Paul Beeson Physician Faculty Scholar in Aging Research Award, and is an elected member of the American Association of Physicians, The American Society for Clinical Investigation, and is an elected Fellow of the American Heart Association. Dr. Hare has also served in numerous leadership roles at the American Heart Association and at the Center for Scientific Review of the National Institutes of Health. Dr. Hare is also a co-founder of Vestion, Inc., and Heart Genomics, LLC, companies that hold cardio-related intellectual property. He received a BA from the University of Pennsylvania, and his MD from The Johns Hopkins University School of Medicine, and completed fellowships at Johns Hopkins and Brigham and Women’s Hospital, and was a Research Fellow at Harvard Medical School.

They’ve put together an impressive scientific board of advisors and Dr. Hare spent $1 million dollars of his own money to buy LGVN at their IPO price of $10 on February 11th.  It’s not that he needs more stock.  Hare owns almost 8 million shares which is about 42% of the company considering they have 18.7 M shares outstanding. A near-term catalyst might be the CEO’s planned speech at the Intercontinental Summit on Aging & Gerontology being held virtually on March 8, 2021. He will discuss Longeveron’s ongoing clinical research program in Aging Frailty and Alzheimer’s disease, in addition to the regenerative medicine investigational clinical research field in general for diseases and conditions associated with aging.

The story gets even better on a deeper dive. Their lead drug candidate, Lomecel-B is being analyzed as a potential treatment for Alzheimer’s based on the hypothesis that its multiple possible MOAs can simultaneously address multiple features of AD. Preclinical studies show that MSCs can potentially reduce AD-associated brain inflammation, improve the function of blood vessels in the brain, and reduce brain damage due to AD progression, and promote regenerative responses. They have completed a multicenter, randomized, placebo-controlled Phase 1 safety study of subjects with mild AD. Perhaps the best explanation of what they do is on the National Institute of Aging Small Business Showcase.   This is the best, most concise article I read. It’s almost as if it was written by the company itself.  It probably was but that’s the way the government works.

As far as I can tell most of these trials are still mostly in Phase 1 which is basically a safety trial to make sure that the guinea pig patients are dying or having adverse effects.

Image result for first rule do no harm

As an important step in becoming a doctor, medical students must take the Hippocratic Oath. And one of the promises within that oath is “first, do no harm” (or “primum non nocere,” the Latin translation from the original Greek.)  I expect Lomocel-B will get through Phase 1’s with flying colors. Mesenchymal stem cells (MSCs) are multipotent stem cells that have been frequently used in clinical applications. To date, MSCs have been used in the treatment of multiple diseases and several MSC-derived products have already been developed and approved as drugs. The central clinical trial registry database reports approximately 1000 clinical trials using MSCs worldwide.
 Other than the speech by the CEO mentioned above the near-term catalysts are an aging fragility Phase 2 read-out trial in 2nd half of 2021
Lomecel-B (ELPIS)
Hypoplastic Left Heart Syndrome
Phase 1

Phase 1 top-line data due 1Q 2021.
Lomecel-B
Aging Frailty
Phase 2

Phase 2 final data due 3Q 2021.
Lomecel-B
Metabolic Syndrome
Phase 2b

Phase 2b top-line data due 2H 2021.
Lomecel-B
Aging Frailty
Phase 2b

Phase 2b data due 2H 2021.

 

Aging Frailty is a common geriatric condition that disproportionately increases a patient’s risk for poor clinical outcomes due to disease and injury, and is widely believed by geriatricians to ultimately be treatable. Our multinational interventional Aging Frailty clinical research program is one of the most advanced and extensive in the world for a pharmaceutical investigational product. According to various studies by leading geriatricians, Aging Frailty affects approximately 15% of individuals 65 years and older, which translates to roughly 8.1 million people in the U.S. alone. Yet, no medical treatments for Aging Frailty have been approved by the FDA, or anywhere in the world.
So let me get this right.  They are making a drug to work for “getting old”?  No way that’s not a blockbuster IF approved by the FDA.  The other indication they are working on is Alzheimer’s, another disease strictly associated with aging. The trick is efficacy.  If we can get any positive readout on efficacy for Alzheimer’s or even Aging fragility- it’s off to the races. Alzheimer’s is big, probably the biggest prize in all of pharmaceutical research but it is dwarfed by aging frailty.  Think Cassava Sciences like returns when SAVA soared twelvefold earlier this year on positive Alzheimer’s open-label trial results.
If nothing else, an investment in LGVN may be very beneficial to mankind.  Aging Frailty is a tragedy.  Living the last years of life in misery is the cruelest cut of all.  Although speculative for sure, LGVN may be a game-changer.  It just may be the most important scientific advance in the last century.  Dr. Ware is one of the pioneers in regenerative medicine and stem cells.  Watch this clip from the Aspen Brain Institute and come to your own conclusions about Longeveron and the potential for mesenchymal stem cells.  We’re all in for now.

 

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$UPWK busting a move, no news either anywhere YET? Linkedin buying them? Facebook? Salesforce? Something feels a foot with Upwork. Great company someone should buy them

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Insiders sell stock for many reasons, but they generally buy for just one – to make money. You’ve always heard the best information is inside information.  Everyone who has any experience at all in the stock market pays close attention to what insiders are doing.  After all, who knows a business better than the people running it?  Officers, directors, and 10% owners are required to inform the public through a Form 4 Filing any transaction, buy, sell, exercise, or any other with 48 hours of doing so. This info is available for free from the SEC’s Web site, Edgar, although we subscribe to SECForm4  as they provide a way to manage and make sense of the vast realms of data. I’ve tried a lot of vendors and SECForm4 is one of the most customer-friendly and responsive I’ve used.

We publish a subscription newsletter called The Insiders Report.  We offer a free 30-day trial so you have nothing to lose by trying it out. Be sure to carefully read the TERMS OF SERVICE.

Another source for insider buying and selling and much more is FinViz Elite. FinViz stands for financial visualization and they do an amazing job of providing reams of data and the tools to help you get to the bottom of it, the information that helps me make informed decisions and probable outcomes. I’ve been using their site for years and it only gets better over time.

This is as close to “insider information” that an ordinary investor is likely to see- and it’s entirely legal. 

BEWARE– Following insiders can be hazardous to your financial health unless you know what you are doing.  Unlike the raw, unfiltered data, The Insiders Fund blog informs you of the purchases that count, the ones that are just window dressing into deceiving the public that all is hunky-dory, and those that are just flat out other people’s money and should be just discarded like bad fish. As a rule, we only look at material amounts of money, $200 thousand or more, as anything less could just be window dressing.

The bar is different from selling because the natural state of management is to be sellers. This is because most companies provide significant amounts of management compensation packages as stock and options. Therefore, with selling, we analyze for unusual patterns, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52-week lows. Another red flag is large planned sale programs that start without warning. Unfortunately, the public information disclosure requirements about these programs referred to as Rule 10b5-1 is horrendously poor. Also planned sales that just pop up out of nowhere are basically sales and are seeking cover under the Sarbanes Oxley corporate welfare clause. I also generally ignore 10 percent shareholders as they tend to be OPM (other people’s money) and perhaps not the smart money we are trying to read the tea leaves on.

Of course, insiders can also be wrong about their Company’s prospects. Don’t let anyone fool you into believing they never make mistakes.  No one tracks and understands insider behavior better than us. We’ve been doing it religiously since 2001 when I quit being an insider myself and devoted myself full time to managing my personal investments. They can easily be wrong about how much others will value them, and in many cases, maybe most cases have no more idea what the future may hold than you or I. In short, you can lose money following them.  We have and we curse aloud, what were they thinking!  Needless to say, past good fortune is no guarantee of future success.  We may own positions, long or short, in any of these names and are under no obligation to disclose that. We welcome your comments on our analysis.

This blog is solely for educational purposes and the author’s own amusement.  Investing with The Insiders Fund is for qualified investors and by Prospectus only. Nothing herein should be construed otherwise.  THE INSIDERS FUND invests in companies at or near prices that management has been willing to invest significant amounts of their own money in.  If you would like to hear more about how you can get involved with the Insiders Fund, please schedule some time on my calendar. 

Prosperous Trading,

Harvey Sax

The Insiders Fund was the 4th best long-short equity fund in the world in 2019