Biotechnology

Warner Chilcott points way for more buyouts

29 Sep 2004

A private equity for Chilcott looks like an opportunistic move to take advantage of the depressed valuations of midcap pharma. And the company isn t even the best value of the lot. Shire looks vulnerable.

Biotech isn’t an exception for capital raising

8 Sep 2004

The UK government has appointed Paul Myners, the chair of M&S, to examine relaxing preemption rights for biotech companies. Creating different capital raising rules for favoured sectors sets a bad precedent.

Pharma sells the future to private equity

7 Sep 2004

SanofiAventis has joined the trend of hiving off divisions and selling majority stakes to buyout funds. This may make margins look better over the short run, but it comes at a longterm cost.

Sanofi beaten down too much by Plavix fear

20 Aug 2004

Sanofi has started paying out E16bn to Aventis shareholders as the two drugs companies merge. Reinvesting it in the combined group is a good idea. Investors get a free option on Sanofi defending the patent on blockbuster drug Plavix.

Bristol-Myers settles SEC probe – report

4 Aug 2004

It s not hard to see why there may have been pressure to massage the numbers. BMS is in a vicious circle caused by historic underinvestment. Criminal charges remain possible, but drugs group BMS has taken another step towards putting $2.5bn of accounting irregularities behind it.

Drugs companies find small is beautiful

28 Jul 2004

Those drugs companies moving into smaller markets are seeing the fastest growth. Not only is the competition less fierce, but margins appear to be rising.

Roche’s E2.4bn sale may signal OTC consolidation

19 Jul 2004

The Swiss drugs group has sold its over the counter business at a premium. Other drugs firms will follow at these prices. For Roche, exiting at a strong price puts it in a good position to bolster its pipeline.

Bayer’s buy of Roche unit makes tactical sense

29 Jun 2004

Such a deal would bulk up the German conglomerate's OTC drugs business and reduce combined costs. But the deal must not distract from bigger strategic issues. The company needs to be broken up.

Discontent with drug makers creates buying opportunity

27 Jun 2004

The waning popularity of drug makers has slammed profit growth and left them open to costly lawsuits. But the damage to drugs stocks looks overdone, and reputations are probably at a nadir.

Glaxo selloff overdone

3 Jun 2004

The company saw nearly £2bn wiped off its market cap after New York attorney general Elliot Spitzer sued the company. Spitzer may be a bulldog, but the maximum damages are likely to be under £10m. The company saw nearly £2bn wiped off its market cap after New York attorney general Eliot Spitzer sued the company.

Serono considers moving to US

2 Jun 2004

No wonder the head of Europe s largest biotech group has threatened to leave Europe. The US offers higher stock market valuations for biotech companies and a more attractive regulatory environment.

Could Glaxo leave the FTSE?

30 May 2004

The UK has seen a hollowing out of drugs companies over the past year. Will bigger companies follow? The question may have seemed ludicrous a year ago. But it pays for companies and shareholders to follow the money. And that's in the US.

Sanofi doesn’t have full control of Aventis

27 May 2004

The new board includes several big cheeses from the Aventis camp who could limit the power of JeanFrancois Dehecq, Sanofi's boss. Fuzzy control reflects the fact that Sanofi paid a modest premium. If it spells power struggles, it could also lead to fuzzy integration.

Glaxo needs Chris Gent’s charm above all

26 May 2004

Gent brings two qualities to the chair of the UK pharmaceuticals group a silver tongue and a penchant for deals. But given Glaxo's lowly valuation, he'll need to talk up its prospects before he gets stuck into M&A.

Biotechs with backs to wall take IPO plunge

25 May 2004

With investors fleeing risk, a biotech float is the last thing one would expect. Yet companies are lining up. The reason? They have little choice as their cash piles burn away.

EU to become friendlier place for generic drugs

21 May 2004

The union is now home to several large generic drugs companies following enlargement eastward. This will give generics companies more political clout in Brussels to the detriment of big pharma.

UK biotech gets lift from £1.5bn Celltech bid

18 May 2004

This is the first time shareholders in a major biotech company have got a cash exit. That is going to boost confidence, and should help to end the investment drought in the sector.

Bayer shouldn’t be satisfied with mediocre Q1

10 May 2004

The German conglomerate says it has had a good start in 2004 with flat sales, declining profits and increasing debt. What would a bad start look like?

Sanofi-Aventis makes everybody sick

29 Apr 2004

Not just Sanofi and Aventis investors whose shares have slid since the agreed deal was announced. Novartis too must be feeling sick. The more Aventis tumbles, the more it must feel it let a deal slip through its fingers.

The market is wrong on AstraZeneca and Glaxo

29 Apr 2004

Astra is widely reputed to have a great collection of exciting new drugs. Glaxo s is supposedly terrible. The reverse seems increasingly true. Shorting Astra and going long Glaxo looks like a smart trade.