By Dan Darrow
August 16, 2022
Intraday Update: ICPT
There were two big Bio events we were watching for this week. One surprised with positive data (BIIB), the other has now turned in disappointing data. ICPT was scheduled to report Phase 3 NASH data by the end of the third quarter, and being the last day of September today, we got the news. The trial failed and the stock is sinking back to the low teens, so the Oct21 $25 - $30 call spread will not work. As a reminder, this was the bull portion of a strangle, with the put spread closed for a $.55 gain, so even though the call spread will lose most of its value, the overall strategy will be roughly flat. The plan will be to recover whatever premium is possible either today or any time over the next few weeks.
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**As of the date and time of publication