Jason Napodano On His Approach To Biotech & Current Market Conditions

Benzinga recently had the chance to converse with Jason Napodano, biopharma analyst and consultant, and owner of BioNap Consulting. So, let’s take a look at some highlights of what the expert said.

Macro Conditions & The Biotech Industry

When asked about the current state of macro conditions for the biotech industry, the expert noted that biotech is highly influenced by market sentiment due to the stocks’ high beta. While the Chinese economy has little, and often no fundamental impact on specific companies, negative market sentiment affects the industry as a whole.

A Patient Approach To Investing

In a recent SeekingAlpha article, Napodano characterized himself as a “very patient investor in biotech companies.” The expert says he looks for companies “with positive changing fundamentals” and makes sure they “have the right management in place to create value.” He assures he is also keenly focused on cash and capital structure, because when he’s wrong, he assures, “it is often because of bafflingly bad management decisions or horrible capital structure.”

“That being said –he adds, I'm using this bio-bear market as an opportunity to add-to and build a position in some solid names. I'm hoping this basket approach will reduce risk and end up rewarding me over the next 12-18 months.”

When questioned about this approach, the expert explained that, while the sell off is temporary, he couldn’t say when the bottom will be hit. However, he does know that if this is truly a bear market, many biotechs will probably lose money. If this is not the case, the names he really likes include Juno Therapeutics Inc JUNO and bluebird bio Inc BLUE for the exposure to CAR-T they provide, and says he is looking to increase his exposure to Cynapsus Therapeutics Inc CYNA, Corbus Pharmaceuticals Holdings Inc CRBP, Pieris Pharmaceuticals Inc PIRS, Neurocrine Biosciences, Inc. NBIX andPOZEN Inc. POZN.