MEI Pharma Surges 24% Amid Litecoin Treasury Strategy and Biotech Sector Turbulence

Summary
• MEIP rockets 24.3% to $7.36, surging past $8.25 intraday high
• $100 million private placement fuels Litecoin treasury strategy
• Biotech sector scrambles as Sarepta faces FDA scrutiny
• Options frenzy: 828 contracts traded on 7.5-strike August call

MEI Pharma’s (NASDAQ:MEIP) 24.3% intraday rally has ignited a firestorm in the biotech sector, driven by a $100 million private placement earmarked for a controversial Litecoin treasury strategy. The stock’s meteoric rise—from $6.34 to $8.25—contrasts sharply with a sector grappling with regulatory headwinds, including Sarepta’s gene therapy troubles and AstraZeneca’s failed amyloidosis trial. With options liquidity surging and leveraged ETFs like XLV in focus, traders are scrambling to position for a pivotal week in biotech.

Private Placement and Litecoin Strategy Ignite Volatility
MEIP’s 24.3% surge stems from a $100 million private placement announced by the company, with explicit plans to allocate proceeds toward a Litecoin treasury strategy. This move, while unconventional for a biotech firm, has triggered a liquidity flood as investors speculate on dual-track value creation: traditional drug development and digital asset diversification. The stock’s intraday high of $8.25—nearly 40% above its 52-week low of $1.46—reflects a market betting on both regulatory flexibility and crypto-driven capital allocation. The decision aligns with broader trends in corporate treasury management, where firms like MicroStrategy have embraced Bitcoin as a reserve asset, though MEIP’s approach introduces heightened volatility.

Options Volatility and ETF Leverage: Navigating the MEIP Surge
• Technical Indicators: RSI at 86.45 (overbought), MACD 0.557 (bullish), 200-day MA at $2.55 (far below current price)
• Key Levels: Intraday high at $8.25, 52W high at $9.00, critical support at $6.34

Options Analysis:
• MEIP20250815C7.5 (August 15 call):
- Strike: $7.50, Delta: 0.5377, IV: 170.94%, Turnover: $104,494
- Payoff at 5% upside (target: $7.72): $0.22/share. High liquidity and gamma (0.1237) make this ideal for a continuation of the bullish momentum.
• MEIP20250919C7.5 (September 19 call):
- Strike: $7.50, Delta: 0.6163, IV: 181.87%, Turnover: $18,422
- Payoff at 5% upside: $0.22/share. Higher gamma (0.0730) and extended expiry offer flexibility for slower price consolidation.

ETF Leverage: While no direct leveraged ETF is listed, biotech ETFs like XLV (up 0.18%) could amplify exposure. Given MEIP’s divergence from sector trends, focus on options for directional bets. Aggressive bulls should target the $8.25 high for a breakout, while conservatives may hedge with the 7.5-strike put (MEIP20250815P7.5) to cap downside.

Backtest MEI Pharma Stock Performance
The 24% intraday surge in MEIP has historically led to mixed short-to-medium-term performance. While the 3-day win rate is 42.60%, indicating a higher probability of positive returns in the immediate term, the longer-term returns are negative, with a 10-day return of -0.23% and a 30-day return of -0.45%. This suggests that while MEIP may experience a brief bounce following a significant intraday increase, it is likely to decline in value in the following days to weeks.

Breakout or Bubble? MEIP’s Litecoin Gamble Enters Critical Phase
MEI Pharma’s 24.3% rally hinges on two pivotal factors: regulatory acceptance of its Litecoin treasury strategy and the durability of its biotech fundamentals. The stock’s RSI near 86 and MACD divergence suggest caution, but the 52W high of $9.00 remains a psychological threshold to watch. With sector leader Amgen (AMGN) up 0.18%, the biotech space is polarized, offering both risk and reward. Traders should prioritize the 7.5-strike August call (MEIP20250815C7.5) for a high-gamma play on continued momentum, while monitoring the $8.25 level for a potential reversal. Act now: Break above $8.25 to validate the Litecoin thesis.