Share Offerings Weigh on BioHealth Shares
Some secondary offerings are good for the existing holders and some are not. Adding cash to the coffers is good when a company can take advantage of a high share price when they need to raise long-term growth capital. But there is also the type of secondary offering that is just private equity or private investors selling shares after a bg run. This morning we have seen three stock offerings in drug and biotech stocks, and there is some good and some bad in here.
BioCryst Pharmaceuticals, Inc. (NASDAQ: BCRX) is getting hit this morning after the company sold 5 million shares in a secondary offering at $9.75 per share via Morgan Stanley, J.P. Morgan, and Oppenheimer. After 10:15 AM EST we have seen 2.5 million shares trade, making this one almost a full-day’s volume (2.9 million on average). This one is down 6.3% at $9.74 and the 52-week trading range is $0.85 to $13.47. This offering is under an existing shelf registration when the company filed to raise up to $57 million. Gross proceeds from this offering before fees and commissions is $48.75 million.
Novavax, Inc. (NASDAQ: NVAX) is trading down this morning on its 6.8 million share public secondary offering which priced at $3.30 per share through Piper Jaffray and Lazard Capital Markets. We have seen only 2.8 million shares so far this morning and the stock is down 10.6% at $3.37. Average volume is now over 6 million shares and the 52-week trading range is $0.52 to $7.79. This is just over $22.4 million in gross proceeds, and the company noted that it would net out $21 million.
Warner Chilcott plc (NASDAQ: WCRX) was the big sale today. The drug company priced a 20 million share secondary offering of common stock at $22.92 per share via Goldman Sachs, Morgan Stanley, Credit Suisse, and JPMorgan. This is not for the company’s benefit as selling shareholders include funds affiliated with Bain Capital Partners, DLJ Merchant Banking, J.P. Morgan Partners, Thomas H. Lee Partners, and certain other institutional investors and members of the company’s senior management. WCRX will not receive any proceeds from the sale of the shares, but it is still paying for the expenses of the offering under an existing agreement. This was a very low discount compared to the $23.15 close yesterday, and frankly it is sort of surprising that shares are only down 1.8% at $22.71. That is a new supply of $458 million in stock which has been dumped on the market.
JON C. OGG
BioCryst, Answer for Swine Flu H1N1 Vaccine Shortages? (BCRX)
I have been a pretty upset US citizen so far this Fall ahead of flu season. I cannot find available regular flu shots at any of my go-to spots. Many drug stores in Houston even have the recording on their telephone answering systems that they do not have the seasonal flu vaccines at this time. And as far as the H1N1 or swine flu vaccine, forget about getting easy access to it. BioCryst Pharmaceuticals, Inc. (NASDAQ: BCRX) may be one answer. But the stress here is on ‘may.’
BioCryst Pharmaceuticals, Inc. (NASDAQ: BCRX) is trading higher on H1N1 or swine flu news this morning. The company’s intravenous experimental drug called peramivir received an “emergency use authorization” by the FDA in response to a request from the U.S. Centers for Disease Control and Prevention. The emergency use authorization for peramivir is for certain adult and pediatric patients with confirmed or suspected 2009 H1N1 influenza infection who are admitted to a hospital.
This is good news, except that this is solely for patients admitted into the hospital. By the time most people decide they have to go to the hospital, they are probably already having severe health issues.
BioCryst is likely to see an immediate boost from this. The company generated a mere $56.561 million in 2008 revenues, down from $71.238 million in 2007 revenues. And the revenue estimates from Wall Street are too few to know if they are even legitimate “consensus figures.” But the estimates appear to be $23.71 million for 2009 and $51.29 million for 2010 according to Thomson Reuters.
At 9:45 AM EST we have BioCryst shares trading up 14.7% at $11.08, and we have already seen 150% of its normal average trading volume with over 4.1 million shares having traded hands.
JON C. OGG
OCTOBER 26, 2009
Unusual Number of 52-Week Highs in BioHealth Stocks (BCRX, CRIS, NKTR, OGXI, SCLN, SVA, SPPI, TRGT, VICL)
As you will see, there are many new 52-week highs out there in some drug and biotech names…. Some of this is on swine flu news despite a big drop in the stock market today, but here goes:
- BioCryst Pharmaceuticals Inc. (BCRX) hit $13.24 today…. 52-week low is $0.85.
- Curis Inc. (NASDAQ: CRIS) hit $2.25 today, the drug discovery company has a small cap at $140 million; 52-week low is $0.68.
- Nektar Therapeutics (NASDAQ: NKTR) hit 8.29 but on very low volume, 52-week low is $8.29.
- OncoGenex Pharmaceuticals, Inc. (NASDAQ: OGXI) hit a high of $42.99, also on fairly thin trading volume…. The 52-week low is all the way down at $2.00 on this cancer company. In 2007, this was over a $100 stock…
- SciClone Pharmaceuticals, Inc. (NASDAQ: SCLN) is up big on heavy block trading as it hit $4.90 vs. a 52-week low of $0.63.
- Sinovac Biotech Ltd. (AMEX: SVA) is what led the flu names today after securing Chinese approval for its swine flu vaccine. Shares are up over 40% at $8.90… but it hit $9,44 today versus a 52-week low of $0.75.
- Spectrum Pharmaceuticals, Inc. (NASDAQ: SPPI) is up over 7% and hit $8.32 on strong volume… 52-week low is $0.55.
- Targacept, Inc. (NASDAQ: TRGT) hit $14.69 today, but on thin trading volume, compared to a 52-week low of $1.40.
- Vical Inc. (NASDAQ: VICL) hit a high of $4.93 versus a low of $1.04. This is on strong volume and is after a rise of flu awareness stocks in China.
JON C. OGG
August 31, 2009
Europe steps up timetable on swine flu vaccines (VICL, NVAX, BCRX)
Shares of vaccine makers including Vical Inc. ((Nasdaq: VICL), Novavax Inc. (Nasdaq: NVAX) and BioCryst Pharmaceuticals Inc. (Nasdaq: BCRX) all are up strongly Monday after Europe’s version of the FDA decided to fast-track swine flu vaccine testing.
According to the Associated Press, The European Medicines Agency is greenlighting swine flu vaccine approvals; Britain, Greece, France and Sweden say they’ll start using the vaccines possibly within weeks.
Amid criticism from some doctors who warn about the potential for unkown side effects, the agency has decided that flu vaccines have been around for four decades, and the type of extensive testing reserved for most new drugs is not needed for swine flu vaccines. It would be using well-tested technology.
Speeding the vaccines to market in Europe may be a numbers game. The World Health Organisation has provided a guesstimate that only 900 million doses of swine flu vaccine may be able to be produced annually on a worldwide basis, for a world population of more than 6.5 million. In a pandemic scenario, that may pit rich countries versus poorer ones for vaccine access. Rich countries appear to want a jump-start.
That already appears to be happening. President Obama earlier this year set aside about $1 billion to buy needed vaccines.
But Europe is moving more aggressively. The U.K., for example, hopes to protect at least half its population from swine flu with vaccines by the start of next year.
For companies like Vical Inc., the news may create a revenue opportunity for the company’s experimental H1N1 swine flu vaccine much quicker than expected. The company late last month showed strong efficacy data for its vaccine in animal models. The company said that at least 75% of vaccinated animals achieved or exceeded the protection threshold after a single dose of vaccine. The company said it is ready to advance directly to large-scale manufacturing for human clinical trials, subject to external funding.
Novavax, Inc. is another big play. The company last month signed a deal with Spain’s health ministry and ROVI Pharma, a specialty drug maker in Spain, to license its genetically engineered technology to produce pandemic and seasonal flu vaccines and build that country’s first vaccine-making plant.
BioCryst is not a vaccine play. But the company made strides with its anti-flu program earlier this month. A study sponsored by BioCryst partner Shionogi & Co Ltd. in Japan showed that its Peramavir candidate was not inferior in terms of efficacy and safety to the anti-flu standard, Roche’s Tamiflu. The study involved a total of 1,099 patients at 146 centers. BioCryst now says it is planning late-stage studies of Peramivir, in hopes of winning an FDA approval.
Analysts covering all three companies are not expecting much, if anything in terms of swine flu-related revenue this year. But that could soon change.
It’s appears to be a race to get ready for the winter flu season. The Centers for Disease Control and Prevention (CDC) today said parents should have their children ages 6 months to 18 months vaccinated for flu this fall as soon as the flu vaccine becomes available. And the FDA wants to test swine flu vaccines among several thousand volunteers in August, in preparation for some vaccinations being available in October.
Europe, meanwhile, is not willing to wait that long. — Mike Tarsala
BioCryst data makes it more of a threat to Roche, Glaxo
BioCryst Pharmaceuticals Inc. (BCRX) shares surged after a Phase III study from one of its partners helped raise investor confidence into the company’s Peramavir anti-flu candidate.
A study sponsored by BioCryst partner Shionogi & Co Ltd. in Japan showed that Peramavir was not inferior in terms of efficacy and safety to the anti-flu standard, Roche’s Tamiflu. The study involved a total of 1,099 patients at 146 centers.
BioCryst now says it is planning late-stage studies of Peramivir, in hopes of winning an FDA approval.
Peramivir is not really BioCryst’s lead drug candidate is Fodosine, a treatment of cutaneous T-cell lymphoma. But ever since the FDA gave fast-track status to Peramivir in 2006, BioCryst has been considered an anti-flu play.
And that’s likely the way that traders will continue to see it, especially since the World Health Organization says swine flu a pandemic — the first time it has declared a flu pandemic in four decades.
More data is likely required before the FDA approves Peramivir. Even with an ongoing pandemic, there seem to be enough U.S. stockpiles of Tamiflu and GlaxoSmithKline’s (NYSE: GSK) Relenza to treat patients with the virus.
Regardless of whether Peramivir is expedited, more data that shows it’s at least on par with Tamiflu may help improve its approval chances, especially since trial data has showed Peramivir might be able to treat Tamiflu-resistant flu strains — Mike Tarsala
Last Gains Seen on Speculative Swine Flu Stocks? (NVAX, GNBT, BCRX, PURE, VICL, VIVO, AVII)
As you will see, the life has been taken out of many of the very speculative swine flu stocks from last week’s highs.
NovaVax, Inc. (NVAX) gained almost 15% to $1.93 today, but this is down about half from last week’s highs of $3.88; shares were at $0.81 before the swine flu scare came out.
Generex Biotechnology Corp. (NASDAQ: GNBT) was up 18% today at $0.438; shares peaked at $0.70 last week and were at $0.27 before the swine flu scare came out.
BioCryst Pharmaceuticals Inc. (NASDAQ: BCRX) rose 14% to $3.24; shares peaked at $4.89 last week and were at $1.75 before the swine flu scare came out.
Pure Bioscience (NASDAQ: PURE) was down 1.2% at $2,40; shares peaked at $3.19 last week and were at $1.75 before the swine flu scare came out.
Vical Inc (NASDAQ: VICL) fell by 7% to $2.09; shares peaked at $3.30 last week and were at $2.40 before the swine flu scare came out.
Meridian Bioscience Inc. (NASDAQ: VIVO) were up barely above flat at $17.69; shares peaked at $18.30 last week and were at $16.13 before the swine flu scare came out.
AVI BioPharma Inc. (NASDAQ: AVII) was flat at $0.76; shares peaked at $1.29 last week and were at $0.74 before the swine flu scare came out.
Jon C. Ogg
Speculative Flu Stocks Started Giving Gains Back (NVAX, GNBT, BCRX, PURE, VICL, VIVO, AVII)
This week there have been many crazy stock gains among the speculative biotech sector, and these were tied directly to the ’speculative stocks’ that could have any ties in reality, fiction, and even imagination to a cure or hope in the fight against Swine Flu.
As you will see below, Novavax, Inc. (NASDAQ: NVAX), Generex Biotechnology Corp. (NASDAQ: GNBT), BioCryst Pharmaceuticals Inc. (NASDAQ: BCRX), Pure Bioscience (NASDAQ: PURE), Vical Inc (NASDAQ: VICL), Meridian Bioscience Inc. (NASDAQ: VIVO), and AVI BioPharma Inc. (NASDAQ: AVII) have all begun their overbought roll-over.
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Swine Flu Speculation Stocks (GILD, BCRX, NVAX, GNBT, VICL, AVII, CRXL, RHHBY, GSK)
Monday is looking like a SWINE FLU speculative flu stock stock bonanza. The two approved drug treatments, not vaccines, which are being released are Tamiflu made by Roche (OTC: RHHBY) and Relenza made by GlaxoSmithkline (NYSE: GSK). Gilead Sciences, Inc. (GILD) gets royalties from Roche for Tamiflu, and its shares are indicated north of $48.00 after a $45.80 close on Friday.
There is a second-tier level of stocks here: BioCryst Pharmaceuticals Inc. (BCRX) was up big Friday as it is a maker of drugs that block key enzymes in viral diseases like the flu, shares are indicated over $3.00 after a $2.21 close on Friday. Novavax, Inc. (NVAX) is another clinical stage company using its virus-like particle platform technology for flu treatments; stock is indicated north of $2.50 after closing up some 75% at $1.42 Friday.
And here is the third-tier of these stocks: Generex Biotechnology Corp. (GNBT) is being passed around as a penny stock flu player with shares indicated around $0.40 after closing up 25% at almost $0.34 Friday. Vical Inc. (VICL) closed up 3% Friday at $2.53 and shares are indicated up around $3.00. AVI Biopharma, Inc. (AVII) rose over 20% to $0.89 Friday and shares are indicated up marginally as a result. Crucell NV (CRXL) has a faster way of making flu vaccines. This closed up 1% on Friday and is hardly moving.
As a reminder, these huge gap ups generally have a one day to multi-day move with each move usually being less than the first. As with issues such as SARS and bird flu, the world did not end and it was only the SARS scare which actually caused real damage. You can probably bet that you will be hearing “squeal like a pig!” jokes.
JON C. OGG
