Catalyst Biosciences Stock Cut in Half on Halted Drug Trial

CBIO stock is headed for its worst day since late 2011

Jun 18, 2018 at 10:39 AM
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Shares of Catalyst Biosciences Inc (NASDAQ:CBIO) are spiraling today, after the drugmaker provided an update on an early stage trial for its hemophilia B treatment. Specifically, the study has been put on hold until it can be determined why the two patients enrolled developed neutralizing antibodies after being treated with the next-generation Factor IX (FIX) candidate CB 2679d/ISU304.

Pouring salt on the proverbial wound, Ladenburg Thalmann nearly halved its CBIO price target to $24.50 from $47.00. Against this backdrop, Catalyst Biosciences stock was last seen down 54.2% to trade at $11.56 -- on track for its worst day since Nov. 8, 2011 -- slicing through recent support at its 120-day moving average, and falling into negative year-to-date territory for the first time since early January.

cbio stock daily chart june 18

The volatile price action has sparked a rush of activity in CBIO's typically quiet options pits. Most recently, about 1,200 puts and 867 calls were on the tape -- 21 times what's typically seen, and volume pacing in the 100th annual percentile. Shorter-term traders are targeting July and August 17.50 calls, where it looks like new positions are possibly being purchased.

While this would imply options traders are betting on a quick bounce for the shares, there's plenty of room for analysts to downwardly revise their ratings -- which could keep the pressure on CBIO stock in the near term. Currently, all three covering brokerage firms maintain a "strong buy" rating, while the average 12-month price target stands all the way up at $48.44.


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