January 12, 2016
By Alex Keown, BioSpace.com Breaking News Staff
SAN FRANCISCO – As the J.P. Morgan Healthcare Conference continues this week, Roche Holding AG is the favorite big-pharma stock among industry investors, Bloomberg reported this morning.
Roche is coming off of a strong quarter, winning approval for two new drugs. The company is also expecting to hear if the U.S. Food and Drug Administration will approve its multiple sclerosis treatment ocrelizumab. Ocrelizumab is an investigational, humanized monoclonal antibody designed to selectively target CD20-positive B cells. Genentech , a division of Switzerland-based Roche, said its Phase III trial ORATORIO was successful in meeting its primary endpoints in the treatment of two types of multiple sclerosis, relapsing MS, which is the most common form of the disease, and primary progressive MS, a debilitating form of the disease marked by steadily worsening symptoms. There are currently no approved treatments for PPMS, but Genentech is hoping ocrelizumab will be a groundbreaking medication for that subset of patients, which is believed to be about 10 percent of the MS population, Genentech said.
Roche’s stock has jumped about 4 percent since the start of the conference, hitting a morning high of $263.50. The stock is down from a one-month high of $278.50 per share, which it hit on Dec. 29.
But while Roche’s stock jumped a bit, biotech stocks overall have not seen much movement since the start of the conference. The SPDR S&P Biotech ETF fell 6 percent Monday to 57.08, a level it had not visited since November 2014, thestreet reported. The XBI, the ETF with the broadest portfolio of biotech stocks, has now lost more than 18 percent to start 2016, thestreet said.
Pfizer Inc. is also a favorite of investors, as the company continues to merge forward with its acquisition of Allergan . The $160 billion merger is not expected to be finalized until the middle of 2016 and will have to face a few hurdles, including a possible investigation from the Federal Trade Commission due to Pfizer’s relocation to Ireland, which some see as an effort to avoid paying higher corporate taxes. Pfizer is currently trading at $31.47 per share, up from a morning low of $31.28 per share.
AbbVie , which is currently trading at $54.29 per share, was the third favorite of investor analysts attending the conference, Bloomberg said.
One big pharma stock that is not a favorite of the analysts attending the conference is London-based AstraZeneca. That stock has the highest percentage of sell recommendations among 15 drugmakers with yearly revenue exceeding $20 billion and at least 20 ratings, Bloomberg said. One reason for the negative viewing of AstraZeneca is due to the company looking to find new revenue sources after several top drugs have lost patent protection. A big money-making drug is something AstraZeneca is looking for to meet its revenue goal of $45 billion in sales by 2023. Acquiring new drugs through mergers and acquisitions will help the company offset declining revenues of drugs that are facing patent loss and increased generic competition, including the antacid Nexium and its heart drug Crestor. Last month, AstraZeneca saw the approval of Tagrisso, its new treatment for non-small lung cancer. AstraZeneca’s stock is down this morning, hitting a morning low of $31.41 per share.
As the conference continues, biotech stocks could continue to see little movement in large part due to companies reporting that expectations are in line with current consensus expectations, which has caused investors to shrug their shoulders, thestreet reported.
