This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Biotech Stock Mailbag: Discovery Labs

I knew this, of course, but sometimes the mouth doesn't follow the brain, especially when you're shooting video. Regardless, I apologize for the mistake.

Peramivir is a legitimate albeit still experimental flu drug, and the company has an initial, small development contract with the U.S. government, which apparently wants to stockpile peramivir in case vaccines fail and this country is plunged into a flu emergency.

But peramivir must be given intravenously, which limits its use to the hospital. There is the possibility of the drug being given in a doctor's office, but primary care doctors are generally not equipped to administer I.V. drugs.

I wasn't trying to be a total Biocryst bear in my video, but was merely pointing out that the stock's run from $4 to $10 bakes in a good amount of whatever peramivir stockpiles the government may purchase. Profit taking by investors, therefore, wasn't a bad idea.

Traders are having a party when it comes to flu stocks. Heck, take a look at the insanity around Inovio Biomedical (INO) this week for proof. But yes, I do think that a lot of this flu mania is hype, and that includes some of the more bullish estimates for the size and scope of peramivir stockpiling contracts that Biocryst bulls are betting on.

I won't be surprised to see the U.S. government buy some more peramivir as a "last line of defense" strategy to tackle whatever the flu delivers this winter. But peramivir has been around a long time -- still unapproved -- and I don't yet see the evidence that government officials see the drug as anything more than a minor part of their contingency plans.

4 of 5

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs