Why Are Insiders Bullish On These 3 Companies?

Endocyte Inc. (NASDAQ:ECYT) had not witnessed any insider buying activity since the end of 2011 until last week. Director Fred A. Middleton purchased 20,000 shares last Friday and 10,000 shares on Tuesday at prices that ranged from $2.78 to $2.84 per share. After the recent purchases, the Director holds a direct ownership stake of 200,999 shares. The biopharmaceutical company mainly focuses on developing therapies for the treatment of cancer and inflammatory diseases. Specifically, the company uses its proprietary technology to build small drug conjugates, known as SMDCs, which target receptors that are over-expressed on unhealthy cells. Each SMDC includes three modules: a targeting ligand, a spacer/linker, and a drug payload. The company’s spacer/linker systems are designed to be stable in the bloodstream and release the active drug from the targeting ligand only when the SMDC is absorbed by the unhealthy cell.

During the third quarter of 2015, the company completed its TARGET trial, a randomized phase 2b trial of vintafolide for use in non-small cell lung cancer, aimed at evaluating the safety and efficacy of vintafolide in second line NSCLC as a single agent and in combination with FDA-approved chemotherapy treatment docetaxel. The final results of the trial were in-line with previous findings. Although there is a long road to travel before the company’s products will be brought to market, long term-focused investors might find the stock an attractive bet at the moment. The stock has lost 43% over the past year, so the recent insider purchase might point to a rebound in the future. The number of hedge funds from our database with positons in the company climbed to ten from seven during the third quarter. Baker Bros. Advisors, managed by Julian Baker and Felix Baker, acquired a 1.36 million-share stake in Endocyte Inc. (NASDAQ:ECYT) during the third quarter.