Biotech-Stock Mailbag: Amgen, MiddleBrook

Denosumab is Amgen's experimental, injectable bone-growing drug, and it is a key driver for getting earnings and revenue moving strongly in the positive direction again.

Results from a crucial phase III study in patients with osteoporosis are expected in the second half of this year. This denosumab study has to be positive, of course, but more than that, Amgen must produce knockout data -- great efficacy with no safety problems -- in order to unseat the current crop of osteoporosis drugs, including Merck's(MRK Quote) Fosamax (a once-daily or weekly pill going generic soon) as well as other injectables including Eli Lilly's (LLY Quote) Forteo and Novartis' (NVS Quote) Reclast.

As for your second question asking for a second-half biotech sector forecast, I'll defer on details for now, because I'm currently writing a column on the topic for publication next week. But quickly, I don't expect a big change in sentiment for the rest of the year. The first half was OK for big-cap biotechs and tough on small- and mid-cap stocks. Looking ahead, investor sentiment for biotech seems no better.

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Midweek news from MiddleBrook Pharmaceuticals (MBRK Quote) prompts me to update an old story. There's not much more to say about MiddleBrook except that I screwed up -- and for that I'm sorry.

Clearly, Wednesday's outcome -- no buyer for the company but a $100 million investment/booby prize so that MiddleBrook can remain independent and launch the antibiotic Moxatag on its own -- is not the outcome I envisioned.

Was I played by my sources who told me as recently as last month that the sale process was still on track? I don't think so. These are people I've known a long time, and I trust them when they told me Wednesday that they were blindsided by this development.