Vivian Lewis Blog | We Called It: Benitec Common Stock Up 104.5%; Warrants Doubled | Talkmarkets
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Vivian Lewis is editor and founder of Global-Investing.com, the daily blog newsletter for Americans and others seeking to internationalize their portfolios. She brings unique experience and competence to the business of picking foreign stocks.

After graduating from Harvard magna cum ... more

We Called It: Benitec Common Stock Up 104.5%; Warrants Doubled

Date: Monday, July 9, 2018 7:02 PM EDT

Back in late 2014 I got into a slanging match with a highly qualified medical doctor and brilliant writer on the Stock Gumshoe website, named Dr KS. We disagreed about an Australian startup biotech company doing gene silencing, an alternate way to remove bad genes from cells, which I considered to be as good as any other methodology. It uses DNA derived RNA silencing rather than gene-splicing to clean out bad genes. 

This Dr KS (who wrote anonymously) considered this method useless. He was also scathing about how the Australian brass of this company, called Benitec Biopharma, pronounced the name of his Medical School British-style, as Dyuke rather than Duke, which in my view is irrelevant. He also was nasty about their strategy, of focusing on Hepatitis C--with more justice, as this is a crowded field for gene therapy. It also was testing against Hepatitis B which is less well-covered. 

Thanks to the doctor's negativism and the habit of biotech startups to visit the well to raise money too often, the then management of Benitec were removed and a new CEO named. This led to the arrival of a key new funder for the Oz firm, NantVentures, the private biotech fund of America's richest doctor, Patrick Soon-Shiong of Los Angeles.     

The South African doctor, of Chinese heritage, invested in BNTC in 2016 and again last year and now owns control of the company. Another MD, Jenel Banks, the fund's CIO, sits on the Benitec board. Dr Soon-Shiong made his fortune with the sale of two drug companies he started, Abraxis, and American Pharmaceutical Partners.

Under the new boss, Benitec has advanced in other ddRNAAi against wet macular degeneration, a common eye disease in the elderly, retinitis pigmentosa, chronic neuropathic pain, and oculopharyngeal muscular dystrophy (OPMD)--all of which were begun under the old management. Under Soon-Shiong it has also added work on amyoltrophic lateral sclerosis (AMLS) and frontotemporal dementia (FTD) plus 3 other neurological disorders for which he will pay milestones. 

Payback began today when BNTC signed a gene therapy development accord with Avovent Sciences for its BB-301 for trating OPMD, now renmaed AXO-AAV-OPMD which targets the c9-orf72 gene which also is associated with ALS and FTD. BNTC gets $10 mn (US) up front and milestones of up to $17.5 mn more. It will also get 30% of the net profits earned for its former BB-301 by AXON.

I sold my Benitec stock to book looses but invested in its warrants, listed options common Down Under. I wrote about this regularly in my blog, www.global-investing.com and of course encouraged my readers to join me in this speculation. I never added the warrants to my model portfolio because they barely traded. 

Today Benitec common stock rose 104.5% in Australia and I'm happy to report its warrants also doubled. Axovant went up 18% premarket. 

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Comments

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Vivian Lewis 10 months ago Author's comment

I am very proud of having stuck to my guns

Vivian Lewis 1 year ago Author's comment

dear Susan

I think there is a good chance its science will work out given the quality of its backers. but of course

you never know!

vivian

Susan Miller 1 year ago Member's comment

Wow, 104%?! I wish I had invested in #Benitec! Any chance $BNTC will continue to increase?