CBST: I like it for its drug Cubicin which fights MRSA, a germ that can be very dangerous because it's resistant to most other bacteria-fighting drugs. MRSA turns out to be ubiquitous, and there are many reported cases of it infecting hospital patients, and causing serious damage to them.
On the one side, CBST is a one-trick pony... they're trying to expand, but CBST is likely to be their $1B+ drug (making CBST one of Fortune's Top 100 Fastest Growing Firms). Cubicin has treated over 1M patients. Although the drug's patent expires in 2016, Teva Pharma has filed a legal challenge, and that's yet to be resolved. Also, some competing drugs are making their way through the pipeline.
Convertible debt was issued in October. The company is projecting total cash/cash eqiv/long-term investments to be $890M by Dec., with ltd at $559M. So the company does have money to make acquisitions, do deals, etc.
In total then from what I can discern, (others may have a more perceptive view), this stock is iffy as to where it might go, and I'd not be a buyer at current price unless I felt more comfortable with the company's prospects. Or I was willing to chance a ride on the pony for just a few shares.
78 pg. presentation here:
snl.com
MRSA fact sheet here:
cubist.com
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I've somewhat the same concerns (drug patent exposure, and pipeline) with FRX, one of the other stocks I mentioned I'm still holding. |
