Talking Biotech ETFs: iShares Nasdaq Biochnology to $100 (IBB, OSIP, MDVN)
Today’s price moves in the biotech sector are quite different from what we saw earlier this week. A hostile merger via tender from Astellas for OSI Pharmaceuticals Inc. (NASDAQ: OSIP) got everyone up in arms this week. So much that other investors were going back over buyout candidate notes. We also gave a list of those recently noted biotech buyout candidates this week.
But today’s news out of Medivation, Inc. (NASDAQ: MDVN) severely missing its endpoints in the Phase III targets for Dimebon as a new potential blockbuster to treat Alzheimer’s Disease has everyone reminded of the risks in betting on speculative biotech stocks with no products on the market. That has a sentiment reversal taking place, and unfortunately Dimebon has become Dime-Bag.
But before this morning’s blow-up there was an interesting call that may have more merit than just the bet against the sector. A chart analysis from OptionsZone.com on the iShares Nasdaq Biotechnology (NASDAQ: IBB) showing a potential break-out pattern on its chart. If these levels hold, the call is for the “IBB” to head to $95 to $100….
JON C. OGG
Biotech Implosion: Medivation, Alzheimer’s Beats Drug (MDVN, PFE)
Medivation, Inc. (NASDAQ: MDVN) is the next biotech implosion. The company’s highly awaited Phase III study on its Alzheimer drug called Dimebon did not meet expectations. It failed to meet primary and secondary endpoints. The problem is that this was hitting 52-week highs yesterday.
The company did note that a separate Phase 3 safety study demonstrated Dimebon’s tolerability when used alone or in combination with approved Alzheimer’s Disease medicines. Just one more problem… if it doesn’t work it doesn’t matter how tolerable it is. In some cases the placebo group even did better on the sugar pill, which is perhaps the worst endorsement a company can get.
Pfizer Inc. (NYSE: PFE) is also indicated lower this morning as well as it was Medivation’s partner on Dimebon for the Alzheimer’s treatment. Shares are indicated down about 1% on the news. Keep in mind that Pfizer has at least one other study in later stages in the fight against Alzheimer’s.
The real hit is in Medivation. Share sare down almost 70% at $12.55 on almost 5 million shares as of 8:28 AM EST. The prior 52-week trading range was $13.36 to $40.49.
Medivation had a market cap of $1.35 billion at yesterday’s closing bell. Its most recent balance sheet showed north of $200 million in cash and investments. It is now going to need every last of that cash.
This is one of those instances where everything failed to flag this. Analysts had been positive, the charts and 52-week trading range were indicating a green light being likely, and there was not a huge imbalance between puts and calls in options trading.
JON C. OGG
Full 2009 ASCO Cancer & Oncology Primer (ABII, AEZS, ALTH, AMGN, APPA, ARQL, BMY, CLDX, CELG, CTIC, CGRB, LLY, EXEL, GHDX, GSK, IMGN, MEDX, MDVN, MITI, OGXI, OSIP, PPHM, PFE, ROSG, SNTA, TRBN, ZIOP, ZGEN)
We have already seen a massive round of abstracts ahead of the huge American Society of Clinical Oncology, or ASCO meeting for 2009, which is scheduled to start this weekend. ASCO is usually thought of as the Holy Grail of cancer conferences and these abstracts and presentations are viewed by investors, analysts, clinicians, doctors, and by cancer patients.
We compiled a brief synopsis for the following drug and biotech companies: Abraxis BioScience, Inc. (NASDAQ:ABII), AEterna Zentaris Inc. (NASDAQ: AEZS), Allos Therapeutics, Inc. (NASDAQ: ALTH), Amgen Inc. (NASDAQ: AMGN), A.P. Pharma, Inc. (Nasdaq: APPA), Arqule Inc. (NASDAQ: ARQL), Bristol-Myers Squibb (NYSE: BMY), Celldex Therapeutics (NASDAQ: CLDX), Celgene Corporation (NASDAQ: CELG), Cell Therapeutics (NASDAQ: CTIC), Cougar Biotechnology, Inc. (NASDAQ: CGRB), Eli Lilly and Company (NYSE: LLY), Exelixis (NASDAQ: EXEL), Genomic Health, Inc. (NASDAQ: GHDX), GlaxoSmithKline (NYSE: GSK) , Immunogen (NASDAQ: IMGN), Medarex (NASDAQ: MEDX), Medivation, Inc. (NASDAQ: MDVN), Micromet, Inc. (NASDAQ: MITI), OncoGenex Pharmaceuticals, Inc. (NASDAQ: OGXI), OSI Pharmaceuticals (NASDAQ: OSIP), Peregrine Pharmaceuticals, Inc. (Nasdaq: PPHM), Pfizer Inc. (NYSE: PFE), Rosetta Genomics (NASDAQ:ROSG), Synta Pharmaceuticals (NASDAQ: SNTA), Trubion Pharmaceuticals, Inc. (Nasdaq: TRBN), ZIOPHARM Oncology (NASDAQ: ZIOP), and ZymoGenetics, Inc. (NASDAQ: ZGEN).
Be advised that some of the data may have been changed since the first abstracts came out, but this is an expansive list of companies with data.
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ASCO's Pre-Abstract Previews (ABII, ALTH, ARQL, CLDX, CTIC, CGRB, LLY, EXEL, GHDX, GSK, IMGN, MEDX, MDVN, OGXI, OSIP, PPHM, PFE, SNTA, ZIOP)
The first massive round of abstracts ahead of the huge American Society of Clinical Oncology, or ASCO meeting for 2009, is due out 6:00PM EST. This is thought of as the Holy Grail of cancer conferences and these abstracts are being picked apart all night by hundreds of investors, analysts, clinicians, doctors, and even by cancer patients. We have brief data here for the following biotech and drug companies, and you can bet there will be more than this: Abraxis BioScience, Inc. (NASDAQ:ABII), Allos Therapeutics, Inc. (NASDAQ: ALTH), Arqule Inc. (NASDAQ: ARQL), Celldex Therapeutics (NASDAQ: CLDX), Cell Therapeutics (NASDAQ: CTIC), Cougar Biotechnology, Inc. (NASDAQ: CGRB), Eli Lilly and Company (NYSE: LLY), Exelixis (NASDAQ: EXEL), Genomic Health, Inc. (NASDAQ: GHDX), GlaxoSmithKline (NYSE: GSK) , Immunogen (NASDAQ: IMGN), Medarex (NASDAQ: MEDX), Medivation, Inc. (NASDAQ: MDVN), OncoGenex Pharmaceuticals, Inc. (NASDAQ: OGXI), OSI Pharmaceuticals (NASDAQ: OSIP), Peregrine Pharmaceuticals, Inc. (Nasdaq: PPHM), Pfizer Inc. (NYSE: PFE), Synta Pharmaceuticals (NASDAQ: SNTA), and ZIOPHARM Oncology (NASDAQ: ZIOP).
Be advised that there may be new data from many of these companies between now and the May 29 to June 2, 2009 meeting in Orlando, Florida. We have already compiled a pre-ASCO cheat sheet to get in ahead of some of these abstracts, and the brief notes are as follows:
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