Monday, September 13, 2010

Arena (ARNA) Today and Tomorrow

Yikes, the Arena countdown is shaking out to be a coin toss. At least that was Cramer's intimation during the Lightening Round tonight. He stated that he was not going to buy a stock in which he did not have an edge. He declared that he had no edge with ARNA, indicating ARNA was a 50-50 play, more or less. Equivocation ruled.

The link up with Meridia and Lorqess is fascinating. Since the Metabolic Panel will run through the controversies surrounding the cardiac issues associated with Meridia BEFORE taking up Lorqess, worriment regarding the Panel's mood is becoming pervasive. Without doubt there is sufficient negativity shadowing Meridia to cast a pall on Lorqess. (Meridia is already banned in Europe.) Many feel this same Panel got antsy with its review of Avandia and that the rejection of Qnexa was related to the antsiness. Back in July, the Panel's agenda was the Avandia review followed by the Qnexa evaluation.

There is a reasonable chance that Meridia will make Lorqess look GOOD. There are no cardiac issues at all with Lorqess. So as bad as Meridia is, Lorqess could be construed as that much more desirable. Perhaps having Meridia go in first offers the same advantage as a singer in an audition enjoys, when he is preceded by an off key crooner. So what may seem bad initially may become ultimately good.

Today revealed a decent but not impressive ARNA volume of over 11 million shares traded with a drop in share value of 22 cents to close in after hours at $6.79. It was a see-saw day.

The planned agenda for the Panel meeting of September 15-16 will be released tomorrow. Once reviewed and digested, this agenda will give some clue to the mindset of the Panel. The stock should trade with greater pop in terms of volume. If the price starts to go up, it could rapidly escalate as a result of short covering. On the other hand, more profit taking with lessening concomitant risk could rule the day as well.

Again, it needs to mentioned that the safety and efficacy profile of Lorqess remains solid and unblemished. There is some buzz about requiring more regulation in using Lorqess, particularly insuring that it not be combined with phentermine. Increased regulations would make the product less attractive by making it less easy to use. Perhaps the same responsibility could be met by placing a warning about the potential for harm when combining Lorqess with phentermine.

The investor/trader needs to be on her toes.

Things will likely move quickly and doubtless lots of money is going to be moving about until the ARNA halt, sometime on Thursday. Check out other entries on this blog and other referenced sites for more information. In any event, do something. Long or short. Better to play than to spectate. So it goes. Till tomorrow...

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