RE:FYIGoldenDilemma wrote: See, when you have a large bulk of institutions holding stock, they are already in. They own +/- right up to the 10% mark.
Their positions are locked and secured. Adding more creates a dynamic where they'd have to go into activist shareholder mode. Deerfield is the dominant force behind the company, essentially. They can narrate what goes on behind the scenes
When all these guys are long, all it takes is the shorts to hit the price each day. There is no one strong enough on the buy side simply because they are already locked in. The tutes that own ~45% are basically trapped and the average retail investor cannot afford to scale a war against the shorts that likely keep enough liquidity around to add more to their short position.
Then, when shorts cover, the price goes up and every retail shareholder and their neighbour thinks this is the reversal we've all been waiting for... to which the spike is then reshorted.
If you want to see how the stock behaves when shorts are not hanging around, go look what happened a month before Yosprala approval. Once it was approved, they were right back... because they know drug approval is irrelevant. The company is being discounted on their debt and the anticipated lack of success for the drugs they are acquiring. Now, the lack of success of Yosprala is more evident... but, go ahead and say "it'll get better in the future". How about: Wait until the results show it and then decide to go long?
The force behind this company is strong. Longs have no support to the share price. The shorts have, and will continue to have, full control until they have a reason to leave.
Anyone long in the name who is in la-la land over how great the future is:
- look at the chart from August 2015
- look at how the price has responded to the "great development" of ARLZ
- look to the forthcoming risk
It's your choice to "wait around and see what happens" in the future. Just like every other illiquid long who is getting fisted by short sellers.
The sheer naivety of ARLZ/CXRX/VRX/ etc etc etc longs is unfortunate. You guys really need to smell the other side of the story here rather than accelerating a loss and just sitting on the side lines "waiting to see what the future holds"
Just a thought, if the sales force is being reduced for Yosprala, what does that mean for their Canadian and European plans for approval?
Furthermore, now the focus is on Zontivity. The market will now evaluate that as such:
- costs to launch it
- show me the money of sales
Until then... let's hear the bull case again.
I hate to keep cr@pping all over this because people feel bad enough as it is, but I don't want to see people ride this thing to zero. Yeah, I'm bitter, cause a 700k loss tends to do that to people, but this morning's news release is confirmation that yosprala numbers are going nowhere fast, nor do they expect them to. It's only been a year and they've already laid off 30% of their reps. Ugh.
The focus shift to zontivity is the company's attempt at giving investors some kind of growing metric to cling to, but if Merck was right, there's the real possibility this is a dead drug also. At the end of the day, they took this 400M pile of cash (or whatever it was) and pinned their hopes on a 25M drug that failed once already? Come on guys, get out now while you still can. If you really think this has turnaround potential, rebuy in the $1.50 range and increase your share count. Not a day trader, but the chances of this thing hitting $1.50 before it hits $2.50 are probably 9 out of 10. Q1 numbers are going to be another kick to the groin, believe it, otherwise, why are they cost cutting? Get ready for a big time Q1 loss.
Also, with yosprala numbers not growing, forget about a buyout anytime soon, if ever. And forget about any up front payments for Europe. Ain't happening. There is absolutely no way in heck that zontivity and yosprala are going to bring this company close to profitibility. The ONLY hope left is that Deerfield agrees to lend ARLZ another chunk of change for a drug that happens to hit a home run, but then nobody sells drugs like that anymore so.... stick a fork in er. And if they do acquire another drug, expect a massive backlash by the market - they're tired of this debt rollup model, and even if by some miracle they do score a homerun with borrowed money, it will take the market 2 quarters to figure that one out - or care.
Mounting losses can definitely blind you, but you gotta know when to cut the chord. I took it on the chin with Merus a couple of years back, cut my losses and dumped the capital into Tribute, which made back my losses and then some. Merus is still nowheresville. The capital I shifted from ARLZ has made me about 5.5% since Q4 was announced - not horrible for a month's return, and I've avoided another 35% haircut or whatever it's dropped since the dust settled. For the love of God men, get out.