NEW YORK (TheStreet) -- While the biopharmaceutical industry as a whole has had an impressive year, not every stock in sector was celebrating on Monday. Small-caps Merrimack Pharmaceuticals (MACK) and Orexigen Therapeutics (OREX) were making moves but in opposite directions.
Orexigen Therapeutics, which specializes in drug treatments for obesity, had plummeted 7% to $6.37 by mid-morning. Earlier in the day, the company announced a proposed offering of $100 million in convertible senior notes due 2020 to institutional investors. Initial buyers will also have a 13-day option to purchase an additional $15 million in notes.
Prior to the announcement, shares had run up 30.1% over the year, short of the 63.4% in gains the iShares NASDAQ Biotechnology Index ETF (IBB)IBB has seen since January.
More typical of the sector in 2013, Merrimack had gained 4% to $4.10, a residual effect of last Tuesday's announcement the company had partnered with global pharmaceutical leader Actavis. The Cambridge, Mass.-based business signed a 10-year partnership agreement with Actavis to develop new treatments using the former's nanoliposomal technology.
Merrimack will receive up to $15.5 million, $2 million of which will be upfront, as part of the agreement. It will also have a "double-digit share of net profits on global sales", according to the company's SEC filing.
The developments signal a welcome turnaround for the company's share prices which had suffered a 48.4% year-to-date loss prior to the announcement. Over the four trading days since, shares have soared 31.2%.
--Written by Keris Alison Lahiff.