Subject: Immune Response Insiders Sell as Stock Slides 
Date: Published: 5/20/92 (97 lines)
Source: Wall Street Journal. Copyright Dow Jones & Co. Inc.

    Inside Track:
    Immune Response Insiders Sell as Stock Slides
    ----
    By Alexandra Peers
    Staff Reporter of The Wall Street Journal

    NEW YORK -- How much further can the biotechs fall?  
    A lot, judging by two insiders at Immune Response Corp. 
    Documents filed with the Securities and Exchange
 Commission show that the company's president and a director
 sold 62,500 shares in recent weeks, even though the stock's
 price is off 50% since January.
    One of the many young biotechnology concerns that are so
 far trading on promise, not profits, Immune Response was the
 best-performing stock last year on the over-the-counter
 market.  For 1991 as a whole, it was up 1,265% even though it
 closed the year at $39.25 a share, substantially below its
 1991 peak of $62.75, reached in November.
    Immune Response is primarily known as the developer of a
 vaccine designed to slow the spread, or effects, of the virus
 that causes acquired immune deficiency syndrome by generating
 an immune response in vaccinated patients.
    It is one of several companies with AIDS-related products
 whose stock prices surged last year in a broad biotech rally
 that gathered momentum following basketball star Earvin
 "Magic" Johnson's announcement that he is infected with the
 virus that causes AIDS.  But prices in the whole group have
 since backed off from their highs.
    In over-the-counter trading, Immune Response shares closed
 yesterday at $19.50, down 25 cents.
    SEC filings show that James Glavin, president of the
 Carlsbad, Calif., company, sold 15,000 shares, or 4% of his
 company holdings, on April 6, at $22.38 to $23 a share.
 That's a total of about $340,350, SEC filings show.  Mr. 
 sGlavin declined to comment.
    Kevin Kimberlin, a company director, has trimmed his
 holdings by 13% with sales of 47,500 shares since March 25,
 SEC filings show, and has filed plans to sell even more
 shares in the future.  So far, his shares have fetched prices
 ranging from $25.75 to $19.50.  Mr. Kimberlin couldn't be
 reached for comment.
    The stock price has fallen as part of a broader decline in
 biotech stocks and also because the company's vaccine has hit
 some roadblocks.  First, on Nov. 13, a federal advisory panel
 said it might be dangerous to allow developers of
 AIDS-related vaccines to bypass extensive testing, and the
 stock plummeted by $15.75, or 26%, to $46.
    A few days later, the stock's slide accelerated after
 Oppenheimer & Co. analyst Jeffrey Casdin issued a negative
 report, saying that "there is no accepted scientific logic
 for why the vaccine mechanism should work; there is still a
 high risk it won't."  And the stock took another hit in March
 of this year when the company said it would delay plans to
 test an HIV vaccine on uninfected humans because of "product
 liability" concerns.
    The largest institutional holder of Immune Response stock
 is Fidelity Investments, the big Boston mutual fund company.
 "We're very surprised that there hasn't been more insider
 buying" at these price levels, said Michael Gordon, portfolio
 manager of Fidelity Select Biotechnology fund.  "But we're
 very big shareholders, and we're hanging in there."
    Mr. Gordon added:  "We continue to believe" statements by
 company officials that the HIV vaccine "will work, and if it
 does, this stock is dramatically undervalued."
    But in October of last year, State Farm Mutual Automobile
 Insurance Co., another of Immune's largest institutional
 holders, trimmed its stake by 300,000 shares, or 21% of its
 holdings, according to SEC filings.  It retains over 1.1
 million shares.  A spokesman said the company "has a policy of
 not commenting on its stockholdings."
    The recent sales weren't the first time there's been
 notable insider selling in Immune Response stock.  Last
 November, William Sullivan, chairman of the board, sold
 20,000 shares, or about one-third of his holdings, for $59
 each just two days before the 26% drop in the stock's price.
    Company spokesman Steven Basta said yesterday that Mr. 
 Sullivan serves as chairman but is "not a part of the
 management team" and thus, it would be misleading to draw any
 conclusions from his sale about the stock.  Mr. Sullivan said
 in a December interview that the timing of his sale was
 "accidental" and that he had also sold shares before the
 stock's price took off.
    Mr. Gordon said the stock's run-up to about $60 in
 November was "premature enthusiasm," but that now its trading
 at "ridiculously low levels."  Immune Response's stock price
 "belongs somewhere in between," he said.
    The next material news on Immune Response is due in July,
 when it releases the results of a study of infected
 individuals who have received the vaccine.

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