As we all know by now, pharma biotech investment is risky
at best and disasterous at worst. “No other sector produces as such huge gains or such steep losses in such short periods of time,†notes The Motley Fool’s Brian Lawler. Below is a year-end round-up of the five best and five worst performing biotech and pharma stocks. Of course, this list doesn’t include larger biotechs such as Genentech or Amgen since these established companies are less prone to major stock market swings. But it does provide a look into which companies and technologies investors found appealing, and those that might that might want to re-examine their approach.
The Best
> Medivation: The San Francisco-based company saw its shares surge after the company announced announced that its Alzheimer's therapy Dimebon hit all five primary endpoints for efficacy in a Phase II trial. The drug also appeared to be safe and well tolerated. Further results are expected in the second quarter of next year.
> Sirna Therapeutics: In the wake of Andrew Fire and Craig Mello’s Nobel Prize for their work on RNAi, the promising technology has garnered significant attention from the biotech industry. Drug giant Merck took note and decided to buy San-Francisco-based Sirna Therapeutics for a hefty $1.1 billion. Sirna's lead drug candidate, Sirna-027, is being developed as a treatment for wet, age-related macular degeneration.
> Acorda Therapeutics: Shares of Acorda skyrocketed after the company reported a successful outcome of its Phase III trial of Fampridine-SR for multiple sclerosis. Researchers found that a statistically significant number of patients in the trial reported improvements in walking speed, the primary endpoint in the trial. Hawthorne, NY-based company plans to seek talks with the FDA on how to proceed with the drug.
> Auxilium Pharmaceuticals: A trial of AA4500--an injectable enzyme product for patients with Dupuytren's Disease—proved that the drug was highly effective in the treatment of the disease. The Malvern, PA-based company also turned in positive results for its topical testosterone gel demonstrated for men with Type 2 diabetes
> Allos Therapeutics: Allos--which is developing small molecule therapeutics for the treatment of cancer--gained orphan drug status for an experimental cancer therapy. Investors are also anticipating favorable results from tow of the company’s lead products--Efaproxyn and PDX--early this month.
The Worst
> Neurocrine Biosciences: In May, Neurocrine stunned the market with its announcement that the FDA had approved two low-dose versions of indiplon and issued a non-approvable letter for a 15 mg dose that is considered vital for its success. In the wake of this news, Pfizer decided to pull out of its co-development pact for the sleep drug. Things only got worse from there, as Neurocrine was forced to reduce its workforce to save money. Shares of the company’s stock took another hit in November as the company announced that it would delay a resubmission of its FDA application for indiplon while reporting third quarter losses.
> Cardiovascular BioTherapeutics: CardioVascular BioTherapeutics headquartered in Las Vegas, Nevada, is focused on developing treatments for cardiovascular disease. After a promising $15 million IPO in 2005, stock dropped from a high of $9.15 in February to $1.80 in December.
> CV Therapeutics: Palo Alto, CA-based CV has seen it’s stock tumble from a high of $27.90 a share in January--when the FDA approved the company’s drug Ranexa for angina--to a low of $9.40 in mid-August. It appears higher costs related to marketing expenses for the new drug are to blame for the company’s $63 million loss in the third quarter of this year.
> Idenix Pharmaceuticals: Idenix took a hit earlier this year when the company announced that it would modify an ongoing phase IIb clinical trial of valopicitabine for hepatitis C. The dosing levels of the drug were adjusted from 800 mg/day to 200 mg/day or 400 mg/day as a result of dose-related gastrointestinal side effects observed in study subjects. Just days later Novartis—which owns 56 percent of the company-- inked a licensing deal to pay Idenix up to $525 million for the rights the drug. Some analysts saw the deal as a way for Novartis to display its confidence in the program at a critical point.
> SkyePharma: SkyePharma started off the year with the loss of chairman Ian Gowrie-Smith, who handed in his resignation in January. Then, when the company inked a long-awaited $165 million licensing deal with Kos Pharmaceuticals for the U.S. marketing rights to Flutiform for asthma, several analysts complained because the drug developer couldn't link up with a bigger name in pharma. And in August the company was stumped as to why SkyePharma stock had dropped to near record lows.
For more on the year’s best and worst performers:
- read this Motley Fool article