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Cubist Pharmaceuticals Inc. (CBST - Analyst Report) recently recalled four lots of its growth driver, Cubicin (daptomycin), an antibiotic injection. Cubist Pharma stated in its press release that this voluntary move was prompted by the presence of particulate matter in multiple vials from the affected lots. The company further stated that the presence of particulate matter in vials is not entirely safe for patients.  Cubist Pharma is ensuring the return of the vials in the affected lots.

Though current supplies of Cubicin may not be interrupted, we believe further slipups regarding Cubicin will impact the drug’s supplies. This will be catastrophic for the company since it is entirely dependent on Cubicin for growth.

Cubicin is available in multiple countries across the globe for the treatment of complicated skin and skin structure infections caused by certain gram-positive bacteria, including methicillin-resistant staphylococcus aureus and methicillin-susceptible S. aureus and s. aureus bacteremia.

Cubist Pharma is looking to expand its product portfolio while reducing the dependence on Cubicin through acquisitions. In Jul 2013, Cubist Pharma announced its intention to acquire a couple of antibiotics makers to strengthen its antibiotics portfolio. Cubist Pharma intends to acquire Optimer Pharmaceuticals, Inc. and Trius Therapeutics. Both the deals are expected to close by year end.

Following the deal with Optimer Pharma, Cubist Pharma extended its deal with Optimer Pharma (which was scheduled to end in Jul 2013) by up to a year. As per the deal, the companies co-promote Dificid (fidaxomicin) in the U.S. for the treatment of C. difficile acquired diarrhea.

Cubist Pharma, a biopharmaceutical company, carries a Zacks Rank #3 (Hold). However, biopharma stocks appearing to be more attractive are Gilead Sciences Inc. (GILD - Analyst Report) and Actelion Ltd. (ALIOF). Both the stocks carry a Zacks Rank #1 (Strong Buy).

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