More Biotech Buyout or M&A Targets (OSIP, VRTX, AUXL, ITMN, HGSI, CELG, DNDN, ENZN, FACT, PBE, XBI)
After today’s hostile Astellas offer for OSI Pharmaceuticals (NASDAQ: OSIP), we have investors and traders alike looking for ‘the next takeover target’ in biotech. Buy now you know that there are many pitfalls in simply looking for biotech stocks to buy because they will be taken over. We have taken a look through our own recent stocks noted as takeover candidates and even gone through some sites of our partners looking through potential takeover candidates in the space.
Morningstar just last week had a short video with some key potential buyout targets in the biotech space. It noted Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX), Auxilium Pharmaceuticals Inc. (NASDAQ: AUXL), and InterMune Inc. (NASDAQ: ITMN). Those are all names that have come up as takeout targets before.
But two that are on Morningstar’s list for buyouts are Human Genome Sciences Inc. (NASDAQ: HGSI) and Celgene Corporation (NASDAQ: CELG) for its REVLIMID franchise. The problem with Human Genome is that it is in the same boat we have addressed on multiple occasions: its size got away from the potential realm of buyers. And Celgene has just become too big at a $28 billion market cap for most potential buyers to consider it and the sales growth from $2.689 billion in 2009 is expected to go to $3.26 billion in 2010 and $3.75 billion in 2011 per Thomson Reuters estimates.
After looking around elsewhere, we went back to some Dendreon Corp. (NASDAQ: DNDN) rumors from last month we covered. This was based somewhat on options trading, and we think this company may have to wait for a suitor. Taking the risk of buying the company out before the FDA approves PROVENGE for advanced prostate cancer is something companies are seeming to shy away from.
Enzon Pharmaceuticals, Inc. (NASDAQ: ENZN) is another name that comes up routinely in the rumor mill. We noted this one hitting 52-week highs in January on fresh rumors.
Facet Biotech Corporation (NASDAQ: FACT) has also fought off attempts from Biogen Idec (NASDAQ: BIIB) as a new add-on for its MS franchise. Biogen has been rebuffed and it supposedly will not have an interest anymore.
ETF investors are chasing up names in the sector as well. PowerShares Dynamic Biotech & Genome (NYSE: PBE) is up 4% at $18.48 and the SPDR S&P Biotech (NYSE: XBI) is up 4.7% at $58.98.
Jon C. Ogg
Vertex (VRTX) Powers Up On Hep C Results
More than 80 percent of hepatitis C patients in each arm of the Phase 2 Study C208 achieved a sustained viral response (SVR) with a telaprevir-based regimen according to results of an intent-to-treat (ITT) analysis announced today by Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX ). The data from Study C208 will be presented in an oral presidential plenary session at the 60th Annual Meeting of the American Association for the Study of Liver Diseases (AASLD), which began yesterday in Boston. Telaprevir is a hepatitis C virus (HCV) protease inhibitor being developed by Vertex Pharmaceuticals Incorporated in collaboration with Tibotec and Mitsubishi Tanabe Pharma.
Study C208 explored telaprevir-based regimens dosed either every 12 hours (q12h; twice daily) or every eight hours (q8h; three times daily) combined with either peg-IFN-alfa-2a (PEGASYS®) or peg-IFN-alfa-2b (PEGINTRON) and ribavirin (RBV), for 12 weeks followed by an additional 12 weeks of peg-IFN and RBV in a response-guided trial design that included 161 treatment-naïve patients (intent-to-treat analysis) with genotype 1 hepatitis C virus (HCV) infection. Across the four arms, SVR rates were 82 and 83 percent in patients treated with the every 12 hour telaprevir-based regimen (PEGINTRON and PEGASYS, respectively) and 81 and 85 percent in patients treated with the every 8 hour regimen (PEGINTRON and PEGASYS, respectively). For the majority of patients, these SVR rates were obtained with a 24-week telaprevir-based regimen.
News pushed shares up 12% to $37.78, just shy of their 52-week high
Douglas A. McIntyre
Biotech Short Selling Positions (XBI)(VRTX)(UTHR)(REGN)(MATK)(GENZ)(CBST)(BMRN)(BIIB)(ALNY)(AMGN)
There were some major moves in the short positions in major biotechs for the period ending August 11.
Amgen (AMGN) short interest was flat at 21 mllion shares.
Alnylam Pharmaceuticals (ALNY) share short rose 2% to 5.8 million.
Biogen Idec (BIIB) short interest dropped a fraction to 9.1 million.
BioMarin Pharmaceutical (BMRN) shares short dropped 6% to 11.7 million.
Cubist Pharmaceuticals (CBST) short interest dropped 8% to 4.8 million.
Genzyme Corporation (GENZ) share sold short fell 5% to 5.7 million.
Martek Biosciences (MATK) shares short rose 2% to 4.2 million.
The short interest in Regeneron Pharmaceuticals (REGN) rose 9% to 5.9 million.
United Therapeutics (UTHR) shares sold short moved down 10% to 3.1 million.
Vertex Pharmaceuticals (VRTX) shares short dropped 2% to 18.1 million
These ten stocks are the top holding of the SPDR S&P Biotech ETF (XBI)
Data from NYSE and Nasdaq
Douglas A. McIntyre
Vertex takes another step towards a possible hepatitis C drug launch (VRTX)
Vertex Pharmaceuticals Inc. (Nasdaq: VRTX) this morning said it will sell its rights to milestone payments tied to its hepatitis C drug telaprevir in Europe, a possible sign that the launch of the drug with partner Johnson & Johnson (NYSE: JNJ) for 2011 may be on track.
Back in April, Vertex presented final data from its Phase IIb trial of the drug in treatment-resistant patients. The data showed success in treating many different treatment groups .Sustained viral response rates were achieved, including those with cirrhosis. Slightly more than half of treatment-resistant patients achieved viral response in the 24-week and 48-week telaprevir-based regimens.
Telaprevir is now considered one of the premier hepatitic-C drug candidates. Its sales within three years of hitting the market could be more than $2 billion.
In selling the rights to the milestone payments, Vertex appears to be making another in a series of cash moves. The company has been adept at doing so over the past 18 months.
It raised about $400 million with a convertible and stock offering in February last year, before the equity capital markets froze. It sold royalties to GlaxoSmithKline (NYSE: GSK) in May 2009. It was able to raise more than $200 million in September last year, when raising funds was very difficult for many biotechs. And it raised more than $300 million in February 2009.
The combination of moves, including a recent debt conversion appears to be adding to its treasure chest in preparation for telaprevir . — Mike Tarsala
Bill Gates, Small Biotech's New Biggest Investor (ALTH, AMAG, RDEA, ARYX, AUXL, BMRN, ETRM, INCY, ITMN, MAPP, OREX, VRUS, REGN, SGEN, VRTX, XNPT)
Late yesterday came the 13-F quarterly filing from the Bill & Melinda Gates Foundation Trust. Bill and Melinda have invested in drugs and research before, as well as dug companies, but there was a slew of biotech stocks in their quarterly holdings. Some of these are cancer winners, while others may seem random. Below we have broken these out by company and size of the position in dollars (M for million; K for thousand) as well as the number of shares.
ALLOS THERAPEUTICS INC. (NASDAQ: ALTH) $3.090M; 500,000 shares
AMAG PHARMACEUTICALS INC. (NASDAQ: AMAG) $1.839M; 50,000 shares
ARDEA BIOSCIENCES INC. (NASDAQ: RDEA) $2.165M; 210,386 shares
ARYX THERAPEUTICS INC. (NASDAQ: ARYX) $1.635M; 480,799 shares
AUXILIUM PHARMACEUTICALS INC. (NASDAQ: AUXL) $2.062M; 74,400 shares
BIOMARIN PHARMACEUTICAL INC. (NASDAQ: BMRN) $1.295M; 104,856 shares
ENTEROMEDICS INC. (NASDAQ: ETRM) $81K; 59,700 shares
INCYTE CORP. (NASDAQ: INCY) $1.02M; 435,700 shares
INTERMUNE INC. (NASDAQ: ITMN) $1.807M; 109,900 shares
MAP PHARMACEUTICALS INC. (NASDAQ: MAPP) $98K; 46,524 shares
OREXIGEN THERAPEUTICS INC. (NASDAQ: OREX) $36K; 13,900 shares
PHARMASSET INC. (NASDAQ: VRUS) $821K; 83,641 shares
REGENERON PHARMACEUTICALS (NASDAQ: REGN) $492K; 35,500 shares
SEATTLE GENETICS INC. (NASDAQ: SGEN) $34.718M; 3,521,088 shares
VERTEX PHARMACEUTICALS INC. (NASDAQ: VRTX) $2.729M; 95,000 shares
XENOPORT INC. (NASDAQ: XNPT) $2.517M; 130,000 shares
