Biotech Values

[DewDiligence]

Rachel McMinn named top biotech analyst in WSJ’s 2011 “Best of Street” survey:

http://online.wsj.com/article/SB10001424052702304070304577396511420792008.html

To her work for BofA Merrill Lynch, the 39-year-old Ms. McMinn brings a doctorate in chemistry and biochemistry and postdoctoral work at the University of California, Berkeley. She has no experience treating patients but says she makes up for it by reading papers and talking with doctors.

Such talks informed another one of her top picks of 2011, a recommendation throughout the year to sell Human Genome Sciences Inc. In March, the Rockville, Md., company and its partner GlaxoSmithKline PLC won approval of Benlysta, the first new drug approved to treat lupus in more than 50 years. By then, more than two dozen doctors had told Ms. McMinn and her team that they wouldn't use the drug. Ms. McMinn considered the expectations for Benlysta sales too high and Human Genome Sciences overvalued. Disappointing sales eventually dimmed the luster of the stock, which fell 69% during 2011.

Ms. McMinn turned in just a few duds. Among them, a full-year buy rating on Incyte Corp. yielded a 9.4% loss for those who followed her recommendation.

According to the WSJ, McMinn recommended INHX in mid 2011 when it was trading at about $4/share, although she seemed to turn somewhat bearish in Jan 2012, just before the buyout offer from BMY (#msg-70509496).

In the same WSJ survey, Cowen’s Phil Nadeau was named the top pharmaceuticals analyst, largely for recommending Pharmasset before the buyout by GILD. (That Pharmasset is classified as pharma while INHX is classified as biotech makes no sense, but that’s how things are done on Wall Street.)