What happened
Shares of clinical- and commercial-stage biotech Sorrento Therapeutics (SRNE.Q) plummeted by a whopping 36.8% during the first four trading sessions this week, according to data provided by S&P Global Market Intelligence. As the biotech hasn't had any clinical or regulatory setbacks to speak of this week, it appears that Sorrento's shares are simply trading lower in lockstep with the broader biopharmaceutical space right now.
Underscoring this point, the vast majority of small- to mid-cap biopharmaceutical stocks have fallen in a big way this week. As a result, the SPDR S&P Biotech ETF and the iShares Biotechnology ETF are both trading near 52-week lows at the moment.
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So what
What's interesting about this latest downturn in Sorrento's stock is that the company actually released two positive updates recently. Last week, the biotech announced that the COVISHIELD (STI-9167) neutralizing antibody is effective against the omicron variant. And earlier this week, Sorrento said that its Mexican subsidiary was granted an authorization for emergency use in the country for the COVISTIX test, which is a highly sensitive lateral flow immunoassay for rapid detection of the SARS-CoV-2 antigen. Sorrento anticipates that orders for the test in Mexico will exceed the current order for 10 million tests.
Now what
Is Sorrento's stock a bargain at current levels? Sorrento sports a broad pipeline of mid- to late-stage therapies across a host of high-value indications. So there's a good chance that the company's stock could rebound in a hurry in the wake of a positive clinical update. In other words, bargain hunters may indeed want to take advantage of Sorrento's sharp pullback this week.
