Nvidia (NVDA) Can’t Shake Citron, Cempra (CEMP) Slammed by FDA Rejection, Plus 3 Other Major Movers

Cesca Therapeutics Inc (NASDAQ:KOOL) is the day’s top gainer, rising by 32%, seemingly on a filing with the SEC. However, the filing only indicates that Boyalife (Hong Kong) Ltd purchased the shares and warrants owned by Boyalife Investment, Inc, which totaled 6.10 million shares and warrants to acquire up to 2.94 million shares. It’s unclear why the market is reacting so positively to the news. It appears it’s being reported as an insider purchase of some renown on several websites, but it actually appears to be nothing more than a company moving an investment between its offices. We would steer clear of this rally for now until more information emerges. Cesca Therapeutics shares were not owned by any of the investors in our database at the end of September.

Cempra Inc (NASDAQ:CEMP) has plummeted by 56% today on much more tangible news: the FDA rejected solithromycin, the company’s antibiotic for the treatment of community-acquired bacterial pneumonia (CABP). The FDA rejected the treatment on the grounds that its dataset, which covered 920 patients, was not large enough to determine the drug’s risk of causing liver injuries. While the data showed no cases of acute liver injuries, there was an alarming increase in liver enzymes. The FDA suggested a 9,000-patient trial would be necessary, though the drug’s label would still include a warning even if the trial were a success. Given that, Morgan Stanley analyst Andrew Berens believes Cempra will cease development of the drug. 13.9% of Cempra’s float was held by 15 of the hedge funds in our system on September 30.

Lastly is NVIDIA Corporation (NASDAQ:NVDA), which continues to feel the pain of being targeted by notorious short-selling firm Citron Research. In a tweet yesterday, the firm, which identified itself as previously being a fan of the stock, warned that headwinds will push Nvidia back down to $90 in 2017, or 23% lower than what it began yesterday at. Shares have slid by 9.17% in the past two days, including by 1.62% today. Nor was Citron the only source warning investors that Nvidia may have peaked; Investors.com noted that technical signals were lined up against the stock, suggesting a 27% decline (close to Citron’s own predicted drop) would be a normal correction to its 50-day moving line. 51 hedge funds tracked by Insider Monkey were long Nvidia at the end of the third quarter, owning 5.8% of its float.

Disclosure: None