Biotech-Stock Mailbag: Amgen, MiddleBrook

They were still wrong, as was I, but there wasn't deceit involved. It was a bad call all around.

What happened? Well, if I'm to believe what I heard from these same folks (and I know, that's tough), potential buyers for MiddleBrook were scared off by the risk of launching a branded antibiotic like Moxatag into a market where generic amoxicillin is cheap.

That was always the risk to the MiddleBrook story, and apparently, it may have scuttled any chance for an acquisition.

Looking ahead, MiddleBrook now hits the reset button with $100 million from a fund controlled by Chicago financier Sam Zell and a new management team that was most recently with Adams Respiratory Therapeutics. Zell is no fool, so he must see some value here by buying in at $3.30 a share. And he surely knew that the company's existing investors -- renters and flippers one and all -- would surely bolt on the news that a buyer wasn't to be found.

Zell is taking the long view on Moxatag. If MiddleBrook's new management can build a smart sales force and launch the drug successfully, those potential buyers who were scared away could come back.

But that's a story for a new group of MiddleBrook investors. I was interested because I believed the company would be acquired. I was wrong about that, so I'm done.

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Onward, reader Will asks, "What are your thoughts on Seattle Genetics (SGEN Quote - Cramer on SGEN - Stock Picks) at current price?"

I like Seattle Genetics for its portfolio of monoclonal antibody-based cancer drugs and significant partnership with Genentech. At $8 and change, the stock is undervalued.

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