Why Osiris Therapeutics Inc. Shares Tanked

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Osiris Therapeutics (NASDAQ: OSIR  )   -- a company that market stem cell-based therapies to treat inflammatory, orthopedic, and wound healing markets -- dipped as much as 17% after announcing the resignation of its president and CEO, C. Randal Mills.

So what: According to the press release, C. Randal Mills will be stepping down as president and CEO for personal reasons, but will remain on board as a strategic adviser for the company. Stepping into the new role of CEO will be current chief operating officer Lode Debrabrandere pending approval of Osiris' board of directors.

Now what: Any time there is a transition at the head of a company, there is an amount of uncertainty created that can work against the stock price and shareholders. The fear from investors is that C. Randal Mills finally delivered Osiris into profitable territory, and his departure could shift Osiris off that path. While I'm certainly disappointed to see Mills leave, Osiris still looks well-positioned to benefit from its diabetic wound-healing treatment Grafix. With a full-year of profitable (albeit a minimal profit) expected next year, I would contend that today's dip may represent an intriguing buying opportunity for more risk-willing and biotech-savvy investors.

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