Is BioCryst Pharmaceuticals A Buy?

Headquartered in Durham, North Carolina, BioCryst Pharmaceuticals is a small-cap stock with promise. Indeed, analysts have pegged the stock as a “Strong Buy.”

The biotech company researches small-molecule and oral medications. Its peramivir injection is used to treat acute influenza under the trademarked names of PERMAIFLU, RAPIACTA, and RAPIVAB.

Galidesivir and Its Impact on COVID-19

At the end of 2020, BioCryst was focused on the development of its RNA drug galidesivir as potential therapy for over 20 RNA viruses. One of the viruses was SARS-CoV-2, or the virus that causes COVID-19.

However, after some investigation, the company turned its efforts toward treating other RNA-based viruses. During phase one of its trial for COVID-19, the company determined that the drug for the virus lacked the efficacy to treat the disease.

RNA-Based Illnesses

According to the National Institutes of Health, RNA viruses result from human diseases, such as:

• Hepatitis C Virus (HCV)
• Ebola
• SARS
• Influenza
• Polio
• Measles
• Human T-cell Lymphotropic Virus Type 1 (HTLV-1)
• Human Immunodeficiency Virus (HIV)

Given that the above diseases are better known, BioCryst’s efforts toward developing RNA treatments for these illnesses makes it a stronger contender against its competitor, Alexion (ALXN).

According to the North Carolina Biotechnology Center website, the drug, galidesivir, represents a broad-spectrum antiviral made to block a major viral enzyme, RNA polymerase. Before the COVID-19 epidemic struck, BioCryst was researching and developing the intravenously-administered galidesivir as a possible therapy for serious diseases, such as Zika, Yellow Fever, Marburg, and Ebola.

BioCryst also markets a drug, Mundesine, for treating T-cell lymphoma and ORLADEYO,* a drug that treats hereditary angioedema.

The sentiment in the market is bullish for BCRX, based on the projections of the analysts. The low price target for the stock is $11.00 while the high price target falls at $20.00.

Recent News

*(June 16, 2021) Yahoo Finance announced that the Israeli Ministry of Health will be working with BioCryst.

The agency has accepted the submission of BioCryst’s ORLADEYO drug in preventing recurrent attacks of hereditary angioedema (HAE) in patients 12 years and older.

BioCryst has also agreed to work with Neopharm Ltd., an Israeli-based company that will commercialize the medicine in Israel.

Reasons for Selling BioCryst?

The sentiment in the marketplace tends to be high for BioCryst. However, you do have to consider the bearish side of the coin too. There are also reasons to sell BioCryst if you currently hold it, including the following:

• The company’s price/sales ratio is high, compared to the company’s peers in the biotech field. It registers at 55.
• The year-over-year growth in debt for Biocryst is 3%, surpassing 95.67% of other U.S. Stocks.

Momentum has been the company’s strongest trending gauge, as the stock has been sliding downward over the past 30 weeks. 

Major Stakeholders

According to CNN Money, institutional investors bought $15.0 million shares of BioCryst during the quarter ended in June 2019 and now own almost 60% of the total shares outstanding. This majority interest is atypical among biotech stocks, signifying that the holders see BCRX as a stock to hold rather than sell.

Just recently, some major companies have invested in BioCryst as well. For example, on March 31, 2021, Healthcor Management LP bought 4.9 million shares of BCRX  and Artisan Partners LS purchased 3.0 million shares of stock.

Goldman Sachs & Co. LLC also launched a private buy of BioCryst, purchasing 1.7 million shares on the same date.

Top 5 Institutional Investors

CNN Money indicates that the top 5 institutional owners of BCRX include:

1. BlackRock Fund Advisors with a stake of 7.99% in the company. It owns 14,205,535 shares with a value of $224,021,287.
2. Baker Bros. Advisors has a 7.15% stake in BioCryst, holding 14,205,535 shares with a total value of $200,449,600.
3. The Vanguard Group records a 5.18% stake in the company and owns 9,198,405 shares with a value of $145,058,847.
4. Sarissa Capital Management has a 4.30% interest in BCRX, owning 7,637,700 shares priced at a total value of $120,446,529.
5. SSgA Funds Management, Inc. has a 4.11% stake in the BioCryst and holds 7,308,816 shares valued at $115,260,028.

Top 5 Mutual Funds that Hold the Stock

The top 5 mutual funds that hold BioCyst stock include:

1. Vanguard Total Stock Market Index (5,006,040 shares)
2. iShares Russell 2000 ETF (4,188,673 shares)
3. SPDR S&P Biotech ETF (3,894,138 shares)
4. Vanguard Extended Market Index Fund (2,493,564 shares)
5. iShares NASDAQ Biotechnology ETF (1,500,967 shares)

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.