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Top 10 Gainers and Losers in the Stock Market AXK-RDEA-DHRM - April 23, 2012

jhowell001 — Tue, 24 Apr 2012 04:22:03 +0000

http://static.pixelpipe.com/5512fab4-643c-4c81-90bd-8a55eb9414a1.mp4

http://www.tradingandinvesting4u.com Here is an inside look on the top 10 gainer and loser companies in the stock market as of today. http://youtu.be/m4AjftXcNJU

What's A Better Buyout: Ardea or Amylin? (RDEA, AMLN, AZN, BMY, MRK)

Jon C. Ogg — Mon, 23 Apr 2012 18:54:33 +0000

Ardea Biosciences, Inc. (NASDAQ: RDEA) is soaring today on news that AstraZeneca PLC (NYSE: AZN) is paying about $1.26 billion to acquire the company. With another small-cap to mid-cap biotech and emerging pharma company being gobbled up by Big Pharma, and with Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) up over 10% on more talk of a possible sale, we want to ask one simple yet complex question: Is Ardea a better acquisition that Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN)?

Ardea Biosciences, Inc. (NASDAQ: RDEA) is now worth about $1.2 billion and the stock’s prior 52-week high had been $29.06. Now shares are up at $31.58 and AstraZeneca buys a gout and cancer pipeline here. The problem is that no one is expecting big earnings nor even big sales any time soon. Thomson Reuters has estimates of -$3.64 EPS on only $13.4 million in revenue in 2012 and -$1.89 EPS on almost $56 million in 2013. Ardea has just over 100 employees and its pipeline includes two gout treatments and two cancer treatments (one for pancreatic cancer and one for primary liver cancer.

Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) now has a $3.8 billion market capitalization rate. With a fresh new diabetes drug approval and with prior speculation of a super-premium buyout, this one already has a lot of premium built in. Shares went from about $11 to more than $17 early in 2012 and then from about $16 to over $24 over the last month before settling down around $23 of late. Now there is talk that it has several interested bidders. Amylin’s ongoing pipeline is concentrated around diabetes and obesity but its main products are BYDUREON and BYETTA. Amylin is also expected to lose money in 2012 and in 2013, but its sales were $650 million in 2011 and are expected to rise to $688.4 million in 2012 and $852.9 million in 2013.

Bristol-Myers Squibb Company (NYSE: BMY) reportedly made a bid for Amylin already, and newer reports have Merck & Co. Inc. (NYSE: MRK), AstraZeneca PLC (NYSE: AZN), and Takeda all lined up as would-be potential acquirers.

It is very difficult to get an apples to apples comparison here when you consider that one company is in the development and clinical stage and the other is already in the product commercialization stage. Ardea is of course a much larger unknown that Amylin. Its price and market capitalization also reflect this.

JON C. OGG

No, the Broncos did not have gout, but they sure looked slow and in pain against the Pats

BioChef in Training — Sun, 15 Jan 2012 17:37:25 +0000

(Ack. Wrote this on Friday, and completely forget to post)

Here we go – I can’t compete with all the goodies the came out from the JPM Healthcare Conference, but here’s Part II of my six-month update from June. No, I wasn’t there, but if you were on Twitter and followed #JPM12, you could have followed some some interesting updates and commentary from the likes of @adamfeuerstein, @BiotechStockRsr, @LifeSciVC, @3NT and many, many more. For a first hand account, some of the presentations were webcast as well, though I did not get a chance to watch any of them live – maybe I can catch a replay over the weekend?

Next up are two companies that may not be the most interesting at present. On this post, I wanted to take a look at two different gout companies that seem to be on opposite paths. In one corner, we have Savient ($SVNT), a former billion dollar company with a marketed product Krystexxa (pegloticase), which has hit some bumps. And in the other, we have Ardea ($RDEA), which is just getting their Phase III trials started, and appears, to my eye at least, an opportunity.

When we last visited $SVNT, they had a $490 MM market cap (71 MM shares x $6.96/share, 6-10-11). By the end of 2011, they had dropped another 68% to $159 MM market cap at $2.23/share (12-30-11) with no significant change in share structure (11/5/11). Wow. Truly amazing, how the market gives and takes away – the never ending battle between bulls and bears.

From the chart below, some of the loss was certainly correlated to weakness in the broader market in August, but for $SVNT, the losses continued into the new year.

Source: Yahoo! Finance

What happened? Slow sales for one. Recall that the full US launch for Krystexxa was near the end of February (2/25/11). If we give them a pass on March, and take a look at the subsequent six-months, during the second and third quarters, we see that uptake is slow: $1.091 MM in Kystexxa revenues 2Q11 Krystexxa, and $1.850 MM during 3Q11. I have no clue what analysts are projecting for 4Q11, but $SVNT will need to do much better.

One would assume fairly robust revenue projections prior to approval, but there are some disappointed investors out there and some analysts that need to re-visit their market models. If I put myself in their shoes and use 100 K as the number of treatment refractory gout patients (conservative?), I come up with a big number, $6 B, in fact, at peak sales. Just a 10% penetration rate would be $600 MM. Given, their slow launch, something is missing from a market adoption perspective.

Maybe the $60,000 annual price tag ($2,300/8 mg dose x 26 weeks) is too much, or the need to visit their doctors office every two weeks for a two hour infusion or the lack of a specific reimbursement code, or J-code, had something to do with lackluster sales…maybe it is just not a major improvement (see Benlysta, from $HGSI)

We know that going forward this year, reimbursement coding won’t be an issue. The company received approval for a specific J-Code for Krystexxa in November. Strange how struggling or marginal products generally cite the lack of a specific reimbursement codes as a hurdle for sales.

Of course, this was followed in December with the dreaded “Dear Healthcare Provider” Letter, which contained new guidance for use, suggesting the potential for some sort of adverse event profile when used in current patient management:

“In this letter, the Registrant recommends that oral urate-lowering medications be discontinued before a patient begins treatment with KRYSTEXXA, and that therapy with oral urate-lowering agents should not be instituted while the patient is taking KRYSTEXXA. It is important to note that during KYSTEXXA’s clinical studies, patients discontinued oral urate-lowering therapy before commencing treatment with KRSYTEXXA. While it is difficult to draw finite conclusions from post-marketing adverse events reporting rates, to date, the Registrant has not seen any unexpected rates of infusion reactions and/or anaphylaxis, which to date remain consistent with the labeling for KRYSTEXXA, and the Registrant continues to closely monitor these events. “

They closed at $2.48/share today, giving them a market cap of $176 MM. Assuming they burn another $40M during 4Q, cash is c. $160 MM at the end of 2011 ($240 MM cash 2Q11, $203 MM cash 3Q11). $2M 3Q sales annualized, yields $8M sales, suggests a 2x sales multiple for simplistic valuation ($160 MM cash + ($8 MM sales x 2 sales multiple) = $176 MM). Crude and doesn’t account for debt, growth, burn, etc.

Is there an opportunity here? It certainly doesn’t look like it at present. Wonder what IMS data looks like, what docs think, and what the Street is modelling for the target population and penetration rates. While this looks cheap, I don’t think the little guy has an edge here. Leave it to the pros.

Alright, next. How did I spend so much text on $SVNT?

When we last looked at $RDEA, they were valued at $636 MM (26.7 MM shares, 4/29/11 x $23.81/share, 6/10/11). While the company also took a hit in August, losing 30% of its value, they were relatively stable through year end ($452 MM market cap = 26.9 MM shares (10/28/11) x $16.81/share on 12/30/11).

Progress. They initiated the first of four Phase III trials for lesinurad (12-19-11). According to clinicaltrials.com, we can expect primary efficacy data in January 2013 (looking for sUA < 6.0 mg/dL). Lucky for me, I still have time to review the Phase III clinical design and compare it to the Phase IIs and look for discordance. Still, has anyone find any data flaws so far?

With $123 MM cash at the end of September last year, they look in pretty good shape, though they did file a $150 MM shelf in Dec. Just out of curiosity, does anyone know what the cost per patient was during the Uloric (febuxostat) Phase III?

Could $RDEA hit the $1 B mark, like $SVNT? If the Phase IIIs perform as well as the Phase IIs without safety issues, then there is a very good chance. Wish the share price is lower – doesn’t hit my arbitrary criteria of <$10/share for consideration.

Last, but not least, I forgot all about BioCryst’s ($BCRX) gout program, BCX-4208, as add-on therapy to xanthine oxidase inhibitors (e.g., allopurinol, febuxostat), on the original post. [Unfortunately, I still have memories of their influenza program and issue with needle length in “larger” patients.] All in all, I think Adam Feuerstein has a good data review here. Follow-up data was released earlier this week, but it doesn’t change my view.

I do like the idea of “multiple shots on goal” for some types of companies, but I’m not so sure $BCRX should have their hands is so many different therapeutic areas: rheumatology (BCX-4208 in gout), infectious disease (peramivir in influenza), and oncology (forodesine in CTCL).

Thanks for stopping by, and see you next week for new goodies and Part III of the June updates. Will try to keep this shorter going forward!

Top Analyst Upgrades & Downgrades (AEG, AA, AGU, RDEA, CTL, CERN, COP, CNX, DMND, FCX, GOOG, IBN, JPM, NEM, BTU, SWC, STM, RIG, VICL)

Jon C. Ogg — Fri, 15 Jul 2011 12:33:46 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Friday morning.

AEGON N.V. (NYSE: AEG) maintained “Buy” but removed from Conviction Buy List at Goldman Sachs.
Alcoa Inc. (NYSE: AA) Started as Outperform with $20 target at Credit Suisse.
Agrium Inc. (NYSE: AGU) Reiterated Buy as Value at Zacks.
Ardea Biosciences Inc. (NASDAQ: RDEA) Raised to Outperform as Bull of the Day at Zacks.
CenturyLink Inc. (NYSE: CTL) Cut to Underperform as Bear of the Day at Zacks.
Cerner Corporation (NASDAQ: CERN) Added to Conviction Buy List at Goldman Sachs.
ConocoPhillips (NYSE: COP) Reiterated Buy at Argus.
CONSOL Energy Inc. (NYSE: CNX) Started as Outperform with $62 target at Credit Suisse.
Diamond Foods, Inc. (NASDAQ: DMND) Cut to Hold at Deutsche Bank.
Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) Started as Buy at BofA/ML; Started as Outperform at Credit Suisse.
Google Inc. (NASDAQ: GOOG) Reinstated as Buy at Needham; Reiterated Buy with $800 target at Canaccord Genuity.
ICICI Bank Ltd. (NYSE: IBN) Cut to Neutral at Credit Suisse.
JPMorgan Chase & Co. (NYSE: JPM) Reiterated Hold at Argus.
Newmont Mining Corp. (NYSE: NEM) Started as Neutral with $65 target at Credit Suisse.
Peabody Energy Corp (NYSE: BTU) Started as Outperform at Credit Suisse.
Stillwater Mining Company (NYSE: SWC) Started as Outperform with $24 target on Focus List at Credit Suisse.
STMicroelectronics NV (NYSE: STM) Cut to Equal-Weight at Morgan Stanley.
Transocean Ltd. (NYSE: RIG) Raised to Buy at Jefferies.
Vical Inc. (NASDAQ: VICL) Reiterated Buy with $8 target at Canaccord Genuity.

You are invited to join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Expect the unexpected

BioChef in Training — Mon, 13 Jun 2011 18:19:48 +0000

In biotech, always expect the unexpected.

Over the past 9-mo, Savient Pharmaceuticals ($SVNT) has seen its market cap explode to $1.6B with Krystexxa (pegloticase) approval for treatment refractory gout, only to see its value fall past its pre-approval valuation of ~$1B, and is now down to ~$490M, as of last Friday.

High investor expectations were apparently crushed when the blushing pegloticase bride could not find a sales and marketing sugar daddy, a big pharma to take her under their wing. Throw in some previously unseen personality flaws, such as unsightly manufacturing hurdles, reimbursement challenges, and a series of sales and marketing missteps and here we are today, a company with a market cap equivalent to its enterprise value:

EV = Market cap – cash + debt
EV = $490M (71M shares (5-5-11) x $6.96/share (6-10-11)) – $268M cash 1Q11 + $230M debt
EV = $498M 1Q10

Compared to its post-approval $1.6B EV

EV = $1.5B (67.6M shares (8-3-10) x $22.97/share (9-30-10)) + $78M cash – $0 debt)

at the end 3Q10, this is quite a change, given that nothing about the product itself has really changed, except the marketer. While $SVNT is due for a slow and painful 2011 ramp, they expect activity to increase during 4Q11 and roll into 1Q12, when they expect a specific J-code for reimbursement. You can read their most recent thoughts on commercialization efforts here (May11 conference call).

In the future, there will likely fewer total refractory patients available for treatment, thanks to Ardea’s ($RDEA) lesinurad (RDEA594; more below), an oral, once daily pill, but this was known at the time of approval and did not temper investor enthusiasm for pegloticase.

With lesinurad’s commercialization several years away, and a rather inconvenient dosing schedule (2-hr iv infusion every 2 wks) for Krystexxa, would/could rheumatologists warehouse patients (similar to what hepatologists/gastroenterologists did with their HCV patients to wait for the telaprevir and boceprevir) or would patients simply wait for or select other available treatments?

As summer approaches, there are no near term catalysts, just an increasing EV as they burn through cash. The question is, “How low can they go?” At present, if I assume 50K-100K treatment refractory gout patients, a 10% penetration rate and $62K annual cost, that’s already $310-$620M in peak revenues, as long as the new management team executes. I’d be curious to learn what others think about physician/patient uptake – is 5-10K patients be too many? what if lesinurad is approved? or is the upside, much higher?

Could there be a few former suitors out there breathing a sigh of relief and possibly considering a potential return to the altar?

Lesson: don’t get caught up in the hype.

I mentioned $RDEA above and think that they have a fun story. $RDEA has its roots in the old IntraBiotics, which had failed developing iseganan, an anti-microbial for ventilator-assisted pneumonia. Just four and a half years after acquiring three R&D programs from $VRX in December 2006, they have grown from a $42M valuation (10.9M shares (12-31-06) x $3.90/share (12-21-06)) to a $636M (26.7M shares (4-29-11) x $23.81 (6-10-11)) company today. And to top it off, their value driver is not even one of the acquired assets!

In 2007 $RDEA began testing their lead asset, RDEA806, an NNRTI, for HIV patients. While they reported encouraging data, including positive viral load reduction in HIV-infected patients, someone must have noticed increased urate excretion from the healthy subjects and patients enrolled in their trials and decided to figure out why.

And thus, the discovery of RDEA594 (now lesinurad). It was a non-active metabolite of RDEA806, which had no effect on viral replication, but was able to inhibit URAT1, and increase urate excretion. While uricosuric drugs are not new (e.g., probenecid, benzbromarone), there are no currently approved drugs targeting URAT1.

Making the connection to gout and having the courage to shift gears and pursue a completely new corporate direction was key for $RDEA. An unexpected effect, which likely created greater value than their original parent program. This is why biotech is fun.

My initial take after reading through the some of the existing data sets (I have not downloaded/read/analyzed all of their poster/presentations) in different gout populations leads me to believe that lesinurad can be used across a greater population of patients, not simply treatment refractory, but including allopurinol intolerant, inadequate allopurinol responders and those restarting allopurinol therapy, by simply adding another pill. This could be a large market opportunity.

On the downside, lesinurad will likely need another 2 years to run and complete two P3 trials, and another year for regulatory approval, if successful. Patients and physicians will need to wait until 2015 for a launch if all goes well, giving $SVNT some time to establish a footprint and solidify its position for all treatment failures, and maybe bump up the price as well.

Gout has been full of surprises – and that’s not even including Takeda’s Uloric (febuxostat), which the UK’s NICE recommended only for people who are intolerant of allopurinol…OK, that wasn’t really a surprise.

No position in $RDEA or $SVNT at present.

BioHealth Business Daily (RDEA, AVNR, CELG, DNDN, ENCO, OPXA, PURE, SVA)

Jon C. Ogg — Tue, 06 Apr 2010 19:04:04 +0000

Today’s wrap of the BioHealth Business Daily includes many less-covered stocks moving on news. We are seeing significant and unusual price changes in shares of Ardea Biosciences, Inc. (NASDAQ: RDEA), Avanir Pharmaceuticals, Inc. (NASDAQ: AVNR), Celgene Corporation (NASDAQ: CELG), Dendreon Corp. (NASDAQ: DNDN), Encorium Group, Inc. (NASDAQ: ENCO), Opexa Therapeutics, Inc. (NASDAQ: OPXA), PURE Bioscience (NASDAQ: PURE), and Sinovac Biotech Ltd. (NASDAQ: SVA).

We have outlined the news and the impact, volume and relative moves, and added in color on each where appropriate.

Ardea Biosciences, Inc. (NASDAQ: RDEA) is trading lower on the pricing of a public offering of 3,500,000 shares of its common stock via Jefferies. Shares are down now only 2.5% at $21.21 on 1 million shares, but the stock opened at $21.01 and went as low as $20.91 this morning.

Avanir Pharmaceuticals, Inc. (NASDAQ: AVNR) is still up but well off highs after it plans to present Phase III data on Zenvia at the annual meeting of the American Academy of Neurology layer in the week in Toronto. Shares were up 7% earlier and the intra-day high was $2.71. Shares are up 3.2% at $2.56 today on almost 1.8 million shares.

Celgene Corporation (NASDAQ: CELG) is up ahead of this week’s R&D day (Thursday) that will showcase drugs beyond Revlimid and after it was listed as a best in class for 2010 by the RBC research team. Shares are up 2.7% at $63.71 on 2.5 million shares; and the 52-week trading range is $37.62 to $65.79 and the average volume is 3.3 million shares.

Dendreon Corp. (NASDAQ: DNDN) went over $40.00 today to a new all-time high. We gave a full run down including stock options pricing analysis over at BioHealthInvestor.com. The stock is up 4% at $39.73 and the volume is now more than double normal at 6.7 million shares.

Encorium Group, Inc. (NASDAQ: ENCO) is hard to track after shares were lower after it delayed filing its annual report. With a $10+ million market cap, enough said despite the move up. Shares are up a sharp 53% at $3.24 on over 4 million shares.

Opexa Therapeutics, Inc. (NASDAQ: OPXA) rose on news that it was presenting drug study data on the Phase II data on its multiple sclerosis drug Tovaxin in the middle of this month. Shares are up 9% at $2.41 on about 166% of normal volume with almost 600,000 shares traded already today.

PURE Bioscience (NASDAQ: PURE) is not a biotech as far as drugs…. If this keeps you from getting germs, that is good enough for us on such a wide move. Shares are up after the EPA registered its antimicrobial sanitizer and plans to launch the product in April to be used in food processing plants, as well as in homes and restaurants under “IV-7 Ultimate Germ Defense for Food Contact Surfaces.” This one is up 20% at $1.95 on more than 1 million shares, about 9-times normal volume for this $68 million market cap stock.

Sinovac Biotech Ltd. (NASDAQ: SVA) held up far better than what earlier indications were signaling. This was down about 7% pre-market after the earnings report showed that the swine flu shot boosted Sinovac’s 4Q profit. Shares are down 3.5% at $5.73. The volume is more than double its normal trading volume with some 1.8+ million shares traded today.

You can join our free daily email distribution list to hear more about dividend trends, analyst upgrades and downgrades, top day trader and active trader alerts, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Opening Bell Day Trader Alerts (KBH, PHM, LIHR, MPEL, AVNR, AMSC, RDEA, CA, CPBY, MEE, CIGX, TIVO)

Jon C. Ogg — Tue, 06 Apr 2010 13:34:16 +0000

Credit Suisse hit the homebuilders… KB Home (NYSE: KBH) is down 2.3% at $16.60 on fairly thin trading volume after it was lowered to Neutral from Outperform. Pulte Homes (NYSE: PHM) Cut to Underperform from Neutral; PHM shares are down 3% at $11.09 on 20,000 shares as of 9:25 AM EST.. Also in homebuilders, KB Home (NYSE: KBH) was started as Hold at Stifel Nicolaus.

Lihir Gold, Limited (NASDAQ: LIHR) is one of the most active stocks with shares down almost 4% at $34.65 on some 856,552 shares as of 9:25 AM EST.

Melco Crown Entertainment Limited (NASDAQ: MPEL) is trying for a second day to have carry-over gains from an analyst upgrade yesterday. Shares are up 1.35% at $5.20 on 140,151 shares.

Avanir Pharmaceuticals, Inc. (NASDAQ: AVNR) is up almost 11% at $2.75 on about 65,000 shares after it will present three scientific posters featuring detailed Zenvia safety and efficacy data from the double-blind phase and the open label extension of the Phase III confirmatory STAR trial at the American Academy of Neurology Annual Meeting in Toronto, Canada.

The top day trader alerts are American Superconductor Corporation (NASDAQ: AMSC) up 0.9%, Ardea Biosciences, Inc. (NASDAQ: RDEA) down 2.1%, CA Inc. (NASDAQ: CA) down 3.5%, China Information Security Technology, Inc. (NASDAQ: CPBY) up 29%, Massey Energy Co. (NYSE: MEE) down 8.6%, Star Scientific, Inc. (NASDAQ: CIGX) up 2.45%, and TiVo Inc. (NASDAQ: TIVO) up 2.3%. SEE THAT LIST AT VSINVESTOR.COM.

JON C. OGG