Health Stocks in Motion
Shares of Epix Pharmaceuticals (EPIX) were among the best-performing health-related stocks Friday, rising 20.8% after the company said the Food and Drug Administration accepted its response to an approvable letter the company received in January.
The FDA will now review the company's new drug application for Vasovist -- as well Epix's May response to the approvable letter. The FDA expects to issue an action letter on the imaging agent in late November, Epix said. "Although we are not yet in agreement with the FDA, we look forward to discussing the scientific issues with them as they review our complete response," the company said. Epix also said that during the review process "the FDA could again request additional studies or other information before granting approval for Vasovist." Shares traded up $1.84 to $10.69.
Coventry Health Care (CVH) fell modestly after the company said that it completed the financing of $450 million in new credit facilities and remains comfortable with second-quarter earnings guidance. The new facilities consist of a five-year, $350 million revolver and a five-year, $100 million term loan. In connection with the payoff and elimination of its previous credit facilities, the company expects to take a noncash charge totaling $5.4 million during the second quarter.
In unrelated transactions, the company will record a $2.6 million gain on the sale of investments in the second quarter. In all, the transactions are expected to cut 2 cents from its fully diluted earnings. The company said that, notwithstanding the one-time items, it still remains comfortable with its second-quarter earnings guidance.Shares of iCAD (ICAD) fell 23.3% after the company said it expects to post a year-over-year decline in second-quarter sales. The medical technology company said that when it reports second-quarter results on July 28, it would post sales of about $4.5 million. A year ago, the company reported sales of $5.64 million. The company said the decline in sales is due to a customer shift into the company's lower-cost products. Shares traded down $1.04 to $3.43. Amedisys (AMED) rose 2.5% after the company agreed to acquire privately held Housecall Medical Resources for $106 million. The acquisition will be funded by a combination of cash on hand and senior secured credit facilities that Amedisys secured from Wachovia Bank and GE Healthcare Financial Services. The acquisition, which is expected to close by the end of July, will add 5 cents to 10 cents a share in earnings during 2005 and add 25 cents to 30 cents a share in 2006. Housecall Medical, which operates 57 home health agencies and nine hospice locations, posted sales of about $103 million over the past 12 months. Shares of Amedisys traded up 92 cents to $37.70.
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