Biotechnology

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 April 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 March 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 February 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 February 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 January 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 December 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 September 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 August 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 June 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 March 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 March 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 February 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.

Philips could be a tortoise to Healthineers’ hare

29 January 2019

The 31 bln euro Dutch medical tech group has a lower valuation and operating margin than its larger German peer. Steady growth and a Healthineers stumble could help it close the gap. Global ageing should lift both companies, though Philips has the greater recovery potential.

Eli Lilly’s $8 bln cancer deal is a worthy wager

7 January 2019

The drug giant reckons it’ll take years to get a good return on its pricey acquisition of Loxo. But the upstart has had startling success figuring out why rare cancerous mutations occur, rather than where. Longer term, that should make for plenty of targets – and sticky prices.

Biotech unicorn gorges at market trough of dreams

28 November 2018

Moderna’s potential could merit an $8 bln IPO, even if investors often underestimate the time and cost of developing new drugs. Amid waning bullishness, the firm is wise to heed the finance commandment of the cash-hungry sector – when hors d’oeuvres are being passed, take two.

Pharma upset derails remake of Samsung’s heir

15 November 2018

Jay Y. Lee championed the $20 bln Samsung BioLogics as a new engine of growth at the South Korean conglomerate. Now the arm faces delisting for breaking accounting rules ahead of its IPO. Such a punishment would be harsh but also fit with Seoul’s new resolve to rein in tycoons.

Biotech unicorn takes rare, rapid road to IPO

11 October 2018

Allogene hopes to sell off-the-shelf cancer immunotherapies. But the firm is under a year old and its treatments may take 10 years to reach the market. Going public bucks the trend of startups staying private for longer. Its founders are striking while their reputations are hot.