Health Winners & Losers: Merck

Earnings, analyst actions and one overturned verdict nudge a few health stocks among a largely flat day for the sector Wednesday.

Merck MRK shares took a breath Wednesday after a Texas appeals court overturned a verdict that had awarded $7.75 million to the widow of a 71-year-old heart attack victim. Leonel Garza had died after taking Vioxx for a month. The drug was pulled from the market in 2004 after research showed it increased the risk of heart attack and stroke.

Merck's shares were up 75 cents, or 1.9%, at $39.92.

Meanwhile, Bernstein Research analyst Geoff Porges raised his rating for biotechnology company Genzyme GENZ to outperform from market perform, and upped his price target to $90 from $82, predicting a 16%-17% hike in profit through 2012. Shares were up $2.39, or 3.5%, at $70.40.

Also, Sanford Bernstein analyst Tim Anderson increased his price target for Schering-Plough SGP stock to $25 from $22. Anderson, who has an outperform rating on the stock, upped his earnings estimates for the company based on sales trends of Vytorin and Zetia, the two cholesterol drugs that have been the center of debate since the company and partner Merck released study data earlier this year. Schering shares rose 76 cents, or 4%, to $19.70.

Both Schering and Merck are components of the Amex Pharmaceutical index, which was up 2.45, or 0.8%, at 300.48.

Heading in the opposite direction, Natus Medical BABY saw shares drop off $1.45, or 6.7%, to $20.07 after it said it will offer 3.5 million shares of its common stock. The company said it will grant a 30-day option to underwriters to purchase an additional 15% of the shares offered to cover over-allotments.

In earnings, Jazz Pharmaceuticals' JAZZ first-quarter loss widened on higher drug development and launch expenses. Shares gave up 50 cents, or 5.7%, to $8.25.

The company reported a loss of $46.7 million, or $1.97 a share, vs. a loss of $19.6 million a year prior. Revenue edged up to $14.6 million from $14.1 million. The results fell short of the Thomson Reuters consensus targets of a loss of $1.57 a share on $20.7 million in revenue.

Small-cap Javelin Pharmaceuticals JAV reported a net loss of $9.8 million, or 20 cents a share, widened from a loss of 15 cents a share in the year-ago quarter. Analyst surveyed by Thomson Reuters had pegged a loss of 23 cents a share.

Ladenburg Thalmann reduced its target to $11 from $13, and Rodman & Renshaw dropped its target to $8 from $10 but the stock edged up 38 cents, or 13.3% to $3.23.

In other analyst action, Lazard Capital nudged its price target for Valeant Pharmaceuticals VRX up to $9 from $8, a day after the company reported its quarterly results. Lazard has a sell rating on the stock, which was up 63 cents, or 4%, to $16.06 on Wednesday.