Biotechnology

Gilead gives glimpse into feverish drug market

29 Jun 2020

Its Covid-19 treatment will set governments back about $2,300 per course – more than it costs to make but far less than U.S. patients would incur with longer hospital stays. There are many ways to decide the value of a drug. Gilead is, perhaps wisely, being relatively restrained.

Royalty Pharma merits private equity drug discount

16 Jun 2020

Pablo Legorreta’s company, which buys up revenue streams on potential blockbuster drugs, went public at a nearly $17 bln valuation. It has been a buyers’ market with limited competition. But rising political risk warrants a big discount to more diversified peers like Blackstone.

Gilead solidifies pharma pandemic insurance premia

9 Jun 2020

The $100 bln company has an approved Covid-19 drug that the U.S. government is distributing. That helps replace maturing HIV and dwindling hep C meds, and made Gilead a takeover target. The ability to cure what ails the entire economy buffs the sector’s strong defensive nature.

Pandemic boosts Chinese biotech cred

8 Jun 2020

Little-known firms like $5 bln CanSino are among the front runners to develop a Covid-19 vaccine. Most are working with foreign governments and companies, underscoring China’s rising industry status. These upstarts will go global even with rising geopolitical tensions.

U.S. testing firms aren’t having a great pandemic

4 Jun 2020

With no vaccine, finding Covid-19 cases is key. But it’s not lucrative. Extra revenue is being offset by falls in other tests for Quest and rival lab companies and in unrelated businesses for test makers like Abbott. There's little time to cash in and plenty of competition.

Corona Capital: Hockey, HBO, Minority businesses

27 May 2020

Concise views on the pandemic’s corporate and financial fallout: A plan to get pucks back on the ice offers a sporting template. Meanwhile, HBO’s streaming service may have missed its moment, and a survey shows minority-owned businesses have mixed feelings about life after Covid.

Moderna puts stock-sale opportunism to test

19 May 2020

The biotech pitching a Covid-19 vaccine joins a rapidly growing list of firms selling more shares to investors. It makes sense, given the market rebound, and some issuers’ need for cash. But the rush to sell by more speculative companies like Moderna should give buyers pause.

Blackstone has remedy for drug R&D cash burn

13 Apr 2020

The private-equity firm is sinking $2 bln into Alnylam, including buying rights to future revenue from a drug still under regulatory review. It's a way to match Blackstone's bulging wallet with the biotech’s hefty costs while limiting exposure to volatile equity markets.

Gilead’s $4.9 bln deal shows regular death goes on

2 Mar 2020

The $88 bln biotech company has the best antiviral bet against coronavirus; it’s also now buying cancer startup Forty Seven. Investors are focused on the former today, but the purchase at a hefty premium is a reminder that the fight against the grim reaper is a long-term affair.

Viral CLSA note delivers welcome rosy outlook

12 Feb 2020

An interview the Hong Kong broker conducted with a SARS expert has been widely circulated, owing in part to a comparison of the new coronavirus to a bad cold. It’s a rare upbeat assessment that defied consensus. The outcome is instructive for many sheep-like market forecasters.

Biotech undergoes the ultimate trial by epidemic

11 Feb 2020

Outfits like $8 bln Moderna have unproven technologies that could speed vaccine development, and cut costs to fatten thin profit margins. The battle against Chinese coronavirus provides a chance to demonstrate proof of concept. Success will depend on convincing regulators.

Big Tech will be both friend and foe to Big Pharma

3 Jan 2020

A programme developed by Google has beaten doctors in detecting malignant tumours. Artificial intelligence could save patients’ lives and help drugmakers develop more sophisticated treatments. Yet better screening could also help governments and insurers rein in drug spending.

Huge biotech M&A premiums narrow perception gap

3 Dec 2019

Astellas’ $3 bln deal for Audentes is the fifth 100%-plus premium in the sector this year. Market pessimism is making targets cheap, notably in speculative areas like gene therapy. But buyers are having to pay up to convince sellers they’re not surrendering at fire-sale prices.

Third China Biologic buyout bid holds little charm

19 Sep 2019

CITIC is back with a new group trying again to take the plasma product maker private. The latest $4.6 bln offer is only 2% sweeter than a rival one from about a year ago, even though business has significantly improved. There are plenty of reasons for shareholders to be wary.

Healthineers robot buy puts big price on old veins

8 Aug 2019

The $41 bln Siemens spinoff is paying $1.1 bln for Corindus, which helps automate vascular operations. It’s paying a vein-popping 100 times revenue to stay ahead of Philips in the race to fix ageing blood vessels. Healthineers will have to pump up growth to justify the price.

Skill, luck and law drive $11 bln biotech buyout

17 Jun 2019

Array BioPharma has developed several potential blockbusters for others. But it wouldn’t be selling to Pfizer at a 62% premium without an earlier gift from antitrust regulators. A pact between two rivals sent valuable drugs Array’s way, along with cash, making it a juicy target.

Aussie telco buyout exhibits fibre-optic fever

28 May 2019

Sweden’s EQT has offered to buy Vocus for $2.3 bln, a 35% premium to its undisturbed price and far higher than 2017 bids from KKR and Affinity. The price reflects hype around fancy fibre networks, which may not last. Shareholders will be grateful for the opportunity to exit.

Review: Theranos story is both crazy and ordinary

29 Mar 2019

A new documentary depicts the blood-testing company’s founder Elizabeth Holmes as an unblinking, controlling CEO who believed she could defy science. Her $9 billion dreams ended in fraud charges. In some ways, though, it’s a painfully normal Silicon Valley story.

Biogen loses same Alzheimer’s bet others have lost

21 Mar 2019

The failures of similar drugs in formal trials meant Biogen’s effort was always a long shot. Yet ditching it vaporized $18 bln, or over a quarter, of the biotech’s value. The giant market for a therapy and the fear of missing out lured in both the company and Wall Street.

Roche pays late entry fee to gene therapy party

25 Feb 2019

The Swiss group is buying Spark Therapeutics, which develops treatments that tinker with patients’ DNA, for $4.3 bln. The deal gives Roche a leg up in a hot sector. But it comes with a fat premium, risk and fierce competition. The rewards may take years to come through.