Mustang Bio is lower despite a FDA expedited designation
Two biotech names under pressure this morning are Mustang Bio Inc (NASDAQ:MBIO) and Retrophin Inc (NASDAQ:RTRX). Below, we'll get in to what's caused each stock to make such outsized moves lower today.
First up is Mustang Bio, down 6% to trade at $4.36, despite the Food and Drug Administration (FDA) granting expedited review status to the company's experimental treatment for a rare genetic disorder, bubble boy disease. MBIO initially looked ready to build on yesterday's 14.8% gain, in aftermarket trading, but pivoted lower after the open, below its 320-day moving average, a trendline that stymied yesterday's rally.
Anyone looking for an explanation of the sudden pivot they could note that MBIO's 14-day Relative Strength Index (RSI) was running hot, coming in at 75 as of yesterday's close. In other words, the shares were due for a short-term breather.
Also swimming in red this morning is Retrophin stock, down 26.7% to trade at $12.75, and earlier falling to a three-year low of $11.84. This comes after the company's experimental treatment for pantothenate kinase-associated neurodegeneration (PKAN) failed its main goal of a late-stage trial. In response, BMO Capital trimmed its price target to $38 from $43.
This is pacing to be RTRX's worst single-session drop since December 2012. Even prior to today, the shares had shed 57% year-over-year, and saw a July breakout stymied by their 200-day moving average. Today's singular bear note could be a sign of things to come; all five in coverage of the equity rate it a "strong buy," and the consensus 12-month price target of $40.71 sits in territory not traded at since 2005.