10 Worst ADR Stocks To Buy According to Short Sellers

8. MoonLake Immunotherapeutics (NASDAQ:MLTX)  

Short Interest as % of Shares Outstanding: 15.13%

Number of Hedge Fund Investors in Q2 2024: 32

MoonLake Immunotherapeutics (NASDAQ:MLTX), headquartered in Switzerland, is a clinical-stage biotechnology company focused on advanced therapies for inflammatory diseases. The company’s leading product, Sonelokimab is currently under approval and is a Nanobody designed to target hard-to-treat inflammation, particularly in severe skin conditions such as hidradenitis suppurative (HS).

HS affects millions worldwide, however, current treatment remains limited, MoonLake Immunotherapeutics’s (NASDAQ:MLTX) Sonelokimab medication is at the forefront of biotechnological solutions to create transformative treatments for chronic inflammatory diseases. The medication is going through a Phase 3 trial program which is enrolling 800 patients and initial data is anticipated to arrive in mid-2025.

On June 10, MoonLake Immunotherapeutics (NASDAQ:MLTX) received positive regulatory feedback from both the FDA (U.S. Food and Drug Administration) and the EMA (European Medicines Agency) for Sonelokimab to treat psoriatic arthritis (PsA). Based on previous feedback from the Phase 3 program, the company is starting its IZAR program which consists of two global trials namely IZAR-1 and IZAR-2. Both trials will test 60mg and 120mg doses of Sonelokimab and will enroll approximately 1,500 patients and use data from the earlier trials to support regulatory approval. The primary endpoint readout is expected by the end of 2026, with the first patient randomization in Q4 2024.

Despite 15.13% of shares being shorted, 32 hedge funds showed a bullish stance on the stock as of the second quarter with stocks worth $1.96 billion. Biotechnology Value Fund is the largest shareholder in the company, holding $956.40 million worth of stock as of June 30. Industry analysts maintain a consensus Buy rating for the company’s stock, with an average price target of $72.86, representing a 30.38% upside potential from its current levels.