Replies to post #63764 on Biotech Values

[MobyInvestor]

Dew,

Here's a slightly different look at those recent buyouts to large premiums that you listed.

I've added the premium relative to it's 52 week high, short interest (% of float), at it's 52w high and SI when it was bought out.

The changes in short interest doesn't seem to be indicative of anything either way, but the premium relative to it's 52w high certainly shows that buy & hold is not the path to riches.

Ticker 52wHigh  Close  Buyout  Premium   Premium    SI      SI 
                               (Close)    (52wH)  (52wH)  (Buyout) 
 KOSN    6.49    1.65   5.50   233.33%   -15.25%   2.44%   9.63% 
 COLY   13.34    3.00   8.00   166.67%   -40.03%  25.14%   4.44% 
 IOMI    4.70    2.92   6.60   126.03%    40.43%   1.78%   1.04% 
 BTRX    7.60    1.76   4.15   135.80%   -45.39%   2.54%   3.19% 
 ENCY    5.05    1.08   2.35   117.59%   -53.47%  20.88%  11.64% 
 TRCA    8.11    4.41   9.00   104.08%    10.97%   5.53%   7.68% 
 SIRT   21.99   12.23  22.50    83.97%     2.32%   4.55%   4.51% 
 MLNM   17.19   16.35  25.00    52.91%    45.43%   6.72%   5.52%

Regards,

moby

[DewDiligence]

Look for Lundbeck to do some deals…

http://www.reuters.com/article/marketsNews/idINL3014516520080630

›Myriad, Lundbeck Alzheimer's drug fails key study

Mon Jun 30, 2008 4:15am EDT
By Gelu Sulugiuc

COPENHAGEN, June 30 (Reuters) - Flurizan, an experimental drug for Alzheimer's disease, failed to help patients in a pivotal clinical test, dealing a blow to its backers Myriad Genetics and Lundbeck (LUN.CO).

Danish pharmaceutical group Lundbeck said on Monday it would take a $100 million writedown in the second quarter following the Phase III test setback, as its shares fell 10 percent.

…"The data is disappointing and it means that Lundbeck has wasted half a billion Danish crowns on this project," said Jyske Bank analyst Frank Andersen.

Lundbeck bought the European rights for the Myriad drug last month for $100 million, hoping it would replace some of the revenue shortfall when blockbuster antidepressant Cipralex/Lexapro loses its patent in major markets in 2012-2014.

OTHER DEALS

Lundbeck Chief Executive Ulf Wiinberg said he would continue to search for other licensing deals within the central nervous system field. "Our pipeline is not enough to offset the 2012-2014 challenge," he told reporters. "We are looking at any deal that has scientific merit to meet patients' needs in the market."

The company's chief financial officer, Anders Gotzsche, said Lundbeck would have 4 billion Danish crowns ($847 million) of cash in hand by the end of the year, giving it considerable firepower for doing deals.

"We have enough resources to back up potential in-licensing or acquisitions we are looking into," he said.‹

[DewDiligence]

Recent Biotech Buyouts at a Large Premium

[Added Jerini.]

 
 Acquired         Premium    Deal         iHub  
 Company  Buyer   to Market  Value  Date  Reference  
 KOSN     BMY       233%     $190M  5/08  #msg-29647147 
 COLY     PFE       167%     $165M 11/07  #msg-24600805 
 IOMI     Intercell 147%     $190M  5/08  #msg-29232165  
 BTRX     Stiefel   136%     $150M  6/08  #msg-30201906 
 ENCY     PFE       118%     $350M  2/08  #msg-26978155 
 TRCA     Ipsen     104%     $660M  6/08  #msg-29795183  
 SIRT     GSK        85%     $620M  4/08  #msg-28705020  
 Jerini   Shire     *71%     $520M  7/08  #msg-30452872 
 MLNM     Takeda     53%     $8.8B  4/08  #msg-28365383 
  
 *199% premium to volume-weighted 
 price during preceding 3 months.

Let’s talk biotech!
What if there were no hypothetical questions?