For the record, my biotech acquisition predictions for 2012 were Seattle Genetics (SGEN), Celgene (CELG), Biomarin Pharmaceuticals (CELG), Amag Pharma (AMAG), Onyx Pharma (ONXX) and Momenta Pharma (MNTA). I'm still waiting for a winner.
@pauldavidson11 asks, "What are your thoughts regarding VVUS approval and ARNA share price?
My thoughts or predictions, in no particular order:
Vivus' (VVUS) weight-loss drug, Qnexa, will be approved on July 17, in line with consensus investor expectations.Qnexa's approval is secondary in importance to the restrictions and warnings expected in the drug's label. Learning how restricted (or not) the Qnexa label reads is likely to play a big part in how investors react on July 17. Vivus shares at Tuesday's close of $29.93 are up 30% since April 9, when the company announced the three-month extension of its FDA review. This looks very much like a classic "run-up" into FDA approval decisions, which is often followed by a sell off. Don't be surprised if Vivus shares fall following Qnexa's approval exactly like Arena Pharmaceuticals' stock price sank following FDA approval of Belviq on June 27. On that subject: At Tuesday's close of $10.02, Arena is down 14% since Belviq's approval. [If you calculate from the intraday high on June 27, Arena shares are down 35%.] The only people surprised by this contraction are die-hard members of the Arena retail-investor cult. Everyone else was sensible enough to realize that the steep climb in Arena's stock price leading up to Belviq's approval was not sustainable. I'm not a believer in the super-blockbuster (read: multi-billion dollar) sales potential for Qnexa or Belviq. Both drugs offer short-term weight loss (Qnexa more than Belviq) but patients end up yo-yoing back to their original obese state. Sales will disappoint relative to expectations. Here's a scenario I expect to play out with about 70% of people who try Belviq: Obese woman visits doctor, asks for Belviq. Doctor prescribes Belviq. Woman pays $150 for a month of pills. Starts taking pills, weight doesn't come off so quickly, even though she's trying to eat better and walk around the block in addition to Belviq. Month two rolls around, woman pays another $150 for her Belviq supply. She's frustrated with only three pounds lost. Salads for lunch replaced once again by potato chips and fast food. Too tired to walk. Month three: Another $150 for Belviq! Ugh! Forgets to take pills several times a week. More fast food consumed. The lost pounds return. Visits doctor, who asks if she wants to continue paying $150 per month for a diet pill that's not working. The answer is obvious. Hell, no.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
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.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
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.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV