Part of the answer for question 1,..
Fourth-quarter biotech stock rally sputters in new year
Tom Abate
Monday, January 21, 2002
©2002 San Francisco Chronicle
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2002/01/21/BU54220.DTL&type=business
Biotech stocks are off to a poor start in 2002, with two leading indexes down more than 11 percent so far this year.
The January slide comes on the heels of a fourth-quarter rally that lifted biotech stocks better than 20 percent.
Despite that strong finish, 2001 disappointed investors. BioCentury, the industry newsletter in San Carlos, breaks biotech firms into five
classes, based on their market capitalization (total worth of shares outstanding).
All five classes slipped last year, according to BioCentury's tally. The smallest companies -- those with market caps under $200 million --
suffered least, losing just 10 percent as a group. The worst performers were midsize firms, with market caps between $200 million and $1
billion. They slipped about 30 percent.
Looking ahead, Needham & Co. biotech analyst Mark Monane says last year's hard-hit stocks in the $200 million to $1 billion range will do
best in the short term.
"Small-cap stocks have traditionally outperformed large-cap stocks as the economy moves out of recession," Monane wrote in a recent report
that assumes the economy has turned the corner.
Many unknowns could thwart these expectations, including the regulatory mood at the U.S. Food and Drug Administration, which must
approve all new medicines.
The agency has been under conflicting pressures from the industry, which chafes at the agency's increasing caution, and consumer safety
groups, which point to an embarrassing series of recalls of approved drugs. Nervousness about which way the agency will tilt continues to
cloud the investment outlook.
QUID PRO QUO: Speaking of the FDA, the agency is in high-stakes negotiations -- over money and regulatory rules -- with the biotech and
drug industries, mediated by key congressional committees, notably Massachusetts Democrat Sen. Ted Kennedy's committee on health.
Since 1992, the FDA's budget -- which is set by Congress -- has been supplemented by fees paid by drug and biotech companies. These fees
include a $313,200 payment when companies ask the FDA to review a new drug, a $21,630 annual fee for each drug on the market and a
$140,109 payment per manufacturing plant.
In 2001, these fees contributed $150 million, or just over 10 percent of the agency's budget. About 900 of the FDA's 9,500 staff jobs depend
on the Prescription Drug User Fee Act, first passed in 1992 and renewed for five years in 1997.
The act will expire this fiscal year unless renewed by Congress. While it might not ordinarily matter to citizens how government agencies earn
their keep, the FDA affects important constituencies.
Biotech and drug firms -- and their investors -- live and die by FDA decisions. Last year, South San Francisco's Genentech Inc. took two big
hits when it delayed seeking approval for asthma and psoriasis medications because the FDA had signaled it was raising the safety bar on new medicines.
Patients also have a stake in seeing the FDA strike the proper balance between protecting the public and becoming so cautious that new
medicines take forever to reach those in need.
Legislators may have their own agendas for the fee talks. Industry sources fear lawmakers will use the negotiations to amend laws governing
generic drugs.
Congress has grown frustrated by the tactics that drug patent holders have used to extend their legal monopolies, and having everyone at the
table makes it a tempting time to hassle over generics.
Biotech and drug firms supported the user fees out of self-interest. If the FDA hired more staff, it could review new drugs more quickly. In the
current talks, industry lobbyists want to close what they consider loopholes in the FDA's promises of quicker action.
"They take action, but that action is to come back and say, 'Do more clinical trials,' " complained one biotech source.
But the industry isn't completely united. Big drug companies pay most of the fees under the current formula, and they have floated proposals to
adjust the fee structure to get more money from biotech firms, which the smaller companies would like to avoid.
On the whole, drug and biotech lobbyists support renewal of the fees and say they are sure a deal can be struck before March, when the FDA
would otherwise have to begin considering pink slips. Of course, the devil is in the details.
Meanwhile, the FDA has been leaderless for a year. Although the buzz on Capitol Hill is that President Bush will appoint Vanderbilt University
pharmacologist Alastair Wood to run the agency, the FDA has so far lacked a champion with the political clout to pound the table at the talks.
"Morale at the agency is the lowest in the 30 years I've been watching the FDA," said Sidney Wolfe, with Ralph Nader's Public Citizen. His
group of industry critics dislikes the fees on the argument that they make the regulators beholden on the regulated.
Part answer to question 2,..
Biovail has earnings and growth and a large number of potential new drugs in the pipeline and the time release patents, hence the big shareprice...
Biovail earns $33,101,000 (U.S.) in third quarter
Biovail Corp (2) BVF
Shares issued 132,586,072 Oct 26 close $79.50
Mon 29 Oct 2001
Mr. Ken Howling reports
Financial results for the third quarter and nine months ended Sept. 30,
2001, were as follows:
All amounts are in U.S. dollars.
Total revenues for the third quarter of 2001 increased 63 per cent to
$152.2-million, compared with $93.4-million reported for the third quarter
of 2000. Total revenues for the nine months ended Sept. 30, 2001, were
$404.9-million reflecting an increase of $195.6-million or 93 per cent over
the nine months ended Sept. 30, 2000.
These favourable results are primarily driven by sales of the Cardizem
brands in the marketplace, sales associated with Biovail Pharmaceuticals
USA acquired in the fourth quarter 2000, product sales revenue in Canada
and strong sales of the company's controlled-release generic product
portfolio.
Net income, excluding charges, increased 37 per cent and was $55.8-million
for the third quarter 2001 versus third quarter 2000 net income of
$40.7-million. During the third quarter 2001, a $22.7-million charge was
recorded related to premium paid in connection with the extinguishment of
$165.5-million of 6.75-per-cent convertible debentures. During the third
quarter 2000, a $141.5-million charge was recorded related to the write-off
of acquired research and development associated with products under
development for Intelligent Polymers Limited.
Net income, excluding charges, for the nine months ended Sept. 30, 2001, of
$129.1-million increased 62 per cent versus $79.8-million for the prior
year equivalent period. |
