Alnylam, Celsion, Protalix, and Agios Pharmaceuticals

"Its been a long time, been a long time, been a long time ..."

Yesterday Seeking Alpha published my latest research and opinion on Alnylam (ALNY):

Why Alnylam Should Be a Big Mover in 2016

I first bought Alnylam on October 6, 2015 at $75.13. As I write it is at $100.57. I have followed Alnylam for some time, so that run up is not a display of genius. I took advantage of the Hillary Clinton biotech swoon to buy ALNY at a reduced price. As I note in the article, Alnylam is priced as if it already has commercial revenue and profits, when in fact it is a developmental stage company. Failure of its drug candidates in trials could made $75 per share look ridiculously high. But its platform can generate many therapies, making it a possible tenner if you can wait a decade.

What else have I bought since I last wrote?

Acceleron (XLRN) at $22.48 on October 14, 2015
Celsion (CLSN) at $1.81 on November 16, 2015
Protalix (PLX) at $1.05 on November 18, 2015
Star Bulk (SBLK) at $0.98 on November 20, 2015
Agios (AGIO) at $50.31 on December 7, 2015.

The only sale I made during the period was Ocata (OCAT), and that is because it was being acquired anyway. I bought OCAT at $5.12 in July and at $3.84 in August. I meant it as another long-term investment. I sold it at $8.48 on December 2, a bit below the buy-out price of $8.50.

My purchases listed above were small even by my standards, mainly just reinvesting the Ocata funds.

The bulk of my portfolio remains in the larger companies: Gilead, Celgene, Biogen, Amgen, and Mylan.

I continue to believe that, for long-term investors, most biotechnology stocks are underpriced right now. While I agree that some government regulation of the most predatory companies may be appropriate, and might even happen, I believe that innovative companies that create therapies valuable to patients should continue to be able to provide better-than-market returns to investors. I believe during patent protection periods pricing should be up to the patent holders. Of course if Medicare or Medicaid feel those prices are too high, they should be able to refuse to pay for the patent-protected therapies, or negotiate a mutually agreeable price.

Even in a Hillary Clinton administration with Democratic majorities in Congress, I believe there is little chance that the current system will undergo anything other than minor tweaks.

Janet Yellen, Stock Picker; I buy more Protalix

Apparently Janet Yellen believes she can pick stocks. Or at least tell people to dump their "smaller" social Internet stocks and biotechnology companies.

So there was a sale today as the ever gullible dumped stocks they picked up when some other idiot told them to buy them in the past.

I am okay with my portfolio right now, particularly my healthcare and biotechnology stocks. I believe some of my companies like Gilead, Amgen, Biogen and Celgene will report increased earnings during the remainder of 2014 and beyond, so I don't ponder their daily volatility much.

I have a number of smaller positions in riskier companies that need good Phase III clinical results and then FDA approval to get their wares to market. I was tempted to buy more today, but ever-cautious, I only picked up one:

Protalix Biotherapeutics (PLX). I doubled my tiny amount of PLX, raising it to just above 1% of my portfolio.

One of my main criteria for picking up small, risky biotechs is that market capitalization indicates that success is not priced in, at least not too much.

If you want, you are welcome to look at my portfolio positions. In most cases there are links to my coverage (analyst conference summaries and articles) of the stocks. My list is not a set of recommendations, I am just being transparent because I am a financial writer.

P.S. Janet Yellen and I have one thing in common: we both have undergraduate degrees from Brown University. Mine was in Political Science. I took two economics courses at Brown, microeconomics and macroeconomics. I started studying the Federal Reserve then, and even then I knew that some of what I was being fed was bullshit.