Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?

To: Icebrg who wrote (9227)	9/29/2003 5:14:48 PM
From: Biomaven	Read Replies (1) \| Respond to of 52153

Well Mike King thinks downgrading biotech now means you might miss the "best part of the year." Wish I could share his confidence: Reuters UPDATE - Biotech stocks seen recovering from latest dip Monday September 29, 4:45 pm ET By Toni Clarke (Rewrites first paragraph, closes stock prices) NEW YORK, Sept 29 (Reuters) - Biotechnology stocks closed higher on Monday, gaining back a bit of ground lost over the past week following a spate of disappointing clinical data, stock downgrades and weakness in broader market indices. ADVERTISEMENT [Ad] The American Stock Exchange Biotechnology Index closed up nearly 1 percent on Monday but remains down about 9 percent since Sept. 19, exceeding the decline of the Dow Jones industrial average which has fallen nearly 3 percent over the same period. The Nasdaq Composite is down more than 4 percent in that time period. "These stocks tend to be volatile, so whichever way the major markets move there tends to be an exaggerated move in the biotechs," said Brian Lester, an analyst at Manning & Napier Advisors Inc. "The pullback has been exacerbated by a couple of clinical disappointments." But analysts said they do not expect a long-term sell-off and predict a strong fourth quarter. "Your odds of making money are good in the sector and your odds of outperforming Nasdaq are pretty good," said Michael King, an analyst at Banc of America Securities (News - Websites). "I think it's too early to be downgrading stocks here. You're going to miss the best part of the year." The recent decline follows a dramatic rise earlier in the year, spurred by the release of promising data on several cancer drugs, including Genentech Inc.'s (NYSE:DNA - News) colon cancer drug Avastin and ImClone Systems Inc.'s (NasdaqNM:IMCL - News) cancer drug Erbitux. Since the beginning of March the biotechnology index has risen 42 percent. But last week saw a few reverses. Shares of Trimeris Inc. (NasdaqNM:TRMS - News) fell more than 11 percent after the company released disappointing third-quarter sales growth estimates for its HIV drug, Fuzeon. Human Genome Sciences Inc. (NasdaqNM:HGSI - News) saw its shares fall 3 percent after it said its experimental anti-inflammatory drug failed a mid-stage trial to treat chronic skin ulcers and that it would not develop the drug, repifermin, for that use. And Biomarin Pharmaceuticals Inc. (NasdaqNM:BMRN - News; Zurich:BMRZn.S - News) halted development of its experimental treatment to reverse anticoagulation in heart bypass surgery after a safety board review indicated the drug, Neutralase, would probably not be safe and efficacious. "There's been some spots where the group has stubbed its toe lately," King said. "In this kind of environment that might have a kind of an amplified effect." Even larger capitalization stocks have not been immune. Credit Suisse First Boston on Monday lowered its rating on Idec Pharmaceuticals Corp. (NasdaqNM:IDPH - News) to "underperform" from "neutral" on the belief doctors will not prescribe its top-selling non-Hodgkin's lymphoma drug, Rituxan, as a maintenance therapy as much as anticipated. Idec and its U.S. marketing partner, Genentech, are hoping positive data from a trial, to be released at the annual meeting of the American Society of Hematology in December, will help spur growth of Rituxan. Some analysts have trimmed their 2003 sales forecast in recent months. Shares of Idec, which has agreed to merge with Biogen Inc. (BGEN.0), fell 37 cents, or 1.1 percent, to close at $33.88 on Nasdaq. Genentech's shares fell 39 cents to $80.00. "Companies like Genentech have risen on their promise," said Elemer Piros, an analyst at Rodman & Renshaw Inc. "What we need to have from the large caps to maintain valuations is flawless execution, and that's what people have become a little skeptical of recently." (Additional reporting by Bill Berkrot) Peter