ImmunoGen (NASDAQ:IMGN) closed the day up 11%, its second double-digit gain in as many days. There doesn't seem to be any obvious news to support this substantial gain that started on Friday. All told, the stock is up 31% over the last three trading days.
Most of the biotechs have had a nice run this week -- the iShares Nasdaq Biotechnology ETF was up 4.1% today. Some of the reason for the excitement could be coming from BIO, the biotech industry's annual trade show, which is happening this week. Unlike medical meetings, BIO isn't typically a conference that drives a lot of news, such as clinical trial data, but most public biotechs are represented at the conference, allowing them to get their stories out to investors, as well as potential biotech/pharma partners or acquirers.
ImmunoGen's larger-than-average move makes you think that there's some kind of leak of information, but the stock is notorious for having major moves where there's no obvious reason, and it's still not clear what drove the stock higher. Sometimes, biotechs just start trading on sentiment, with investors throwing fundamentals out the window.
Long-term investors can ignore these big moves higher -- which unfortunately might be followed by a pullback -- and focus on the future. ImmunoGen's two biggest tasks right now are: (1) enrolling its phase 3 trial called FORWARD I that's testing its lead drug, mirvetuximab soravtansine, in women with ovarian cancer, and (2) generating cash to pay for the study. As of the end of the first quarter, ImmunoGen only had $126.6 million in the bank, which the company estimated will last into the second quarter of 2018.
Since then, it's generated some cash by selling off IMGN529 to Debiopharm and by amending its license agreement with Sanofi (NYSE:SNY) to forgo future milestones and royalties in exchange for a $30 million payment now. However, the company will likely need more cash to get through the FORWARD I readout in early 2019 and hopefully launch the drug.