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The Zacks Analyst Blog Highlights: Agios Pharmaceuticals, BioMarin Pharmaceutical, Vertex Pharmaceuticals and Incyte
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For Immediate Release
Chicago, IL – April 16, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Agios Pharmaceuticals, Inc. (AGIO - Free Report) , BioMarin Pharmaceutical Inc. (BMRN - Free Report) , Vertex Pharmaceuticals, Inc. (VRTX - Free Report) and Incyte Corporation (INCY - Free Report) .
The current year began on widespread optimism, predicting a significant increase in drug/biotech mergers and acquisitions (M&A) activity, mainly buoyed by the new tax law enacted in December 2017 and purchasing newer technologies. The tax reform has lowered the tax rate and provided a low-tax window to bring back huge cash stashed overseas. These will certainly improve the cash position of the companies and fuel M&A activities amid struggling organic growth.
With a quarter of the year already gone by, we have seen quite a few billion dollar buyout deals being inked. For instance, Celgene Corporation acquired Juno Therapeutics to add a CAR-T therapy to its pipeline for approximately $9 billion. Moreover, the company is in process to complete the acquisition of Impact Biomedicines for an upfront amount of $1.1 billion. Also, Sanofi in a bid to strengthen its blood disorder pipeline purchased Bioverativ for $11.6 billion and even offered to buy Belgian Biotech Company, Ablynx for $4.8 billion.
Additionally, Pfizer is aggressively on the lookout for a buyer for its Consumer Healthcare unit after British firms Glaxo and Reckitt Benckiser Group withdrew from discussions. However, Glaxo announced its acquisition of Novartis’ stake in their healthcare joint venture for $13 billion. Meanwhile late last month, Takeda also confirmed its intention to integrate Dublin-based Shire into its portfolio to boost its core therapeutic areas.
Moreover, this week bore news of a couple of more M&A deals. A brief description of the two deals is as follows:
Novartis to Buy AveXis
Novartis inked a deal to acquire the U.S. based clinical stage gene therapy company, AveXis, to boost its presence in gene therapy and neuroscience space.
AveXis’ lead gene therapy candidate, AVXS-101, is being developed to treat spinal muscular atrophy ("SMA"), a neurodegenerative disease, accounting for the highest genetic cause of death in infants. The only approved treatment for SMA is the Biogen’s Spinraza.
Per the agreement, Novartis will close the acquisition in an all cash deal of $8.7 billion. The company proposed a cash-tender offer of $218 per share for AveXis’ common stock. The deal is expected to culminate in the second half of 2018. (Read more: Novartis Inks $8.7 Billion Gene Therapy Deal to Buy AveXis)
Alexion-Wilson Deal
Alexion Pharmaceuticals announced that it will consolidate Sweden-based Wilson Therapeutics in its portfolio to add a late-stage candidate to its pipeline for the treatment of Wilson disease, a rare genetic disorder. The acquisition is line with the company’s strategy to diversify its portfolio and lower its dependence on its blockbuster drug, Soliris.
Alexion has offered 232 Swedish Krona in cash for each outstanding share of Wilson Therapeutics, which translates into a total transaction value of $855 million. The buyout is expected to get wrapped up this quarter. (Read more: Alexion to Acquire Wilson Therapeutics for $855M)
In this article, we suggest three drug/biotech companies as logical acquisition targets this year. The parameters counting for buying a drug/biotech stock are the current sales performance of its drugs/products, prospects of future sales growth and the quality of the company’s pipeline. Takeovers of small-cap drug/biotech companies are very difficult to forecast and are quite frequent in the said space. Hence, these have been excluded from the discussion.
Agios Pharmaceuticals, Inc.
Agios Pharmaceuticals’ share price is witnessed to rally this week on speculations that the company might be bought by other big players in the pharma and biotech industry.
The company received an FDA approval for Idhifa (enasidenib) in August 2017 for treatment of acute myeloid leukemia (“AML”) with IDH2 mutation, lending a huge boost to its immense commercial potential in the target market. Agios’ ivosidenib is under review in the United States as a therapy for relapsed/refractory AML with IDH1 mutation. The candidate is also being developed for addressing advanced hematologic malignancies.
Agios’ pipeline also includes a mid-stage genetic diseases candidate. A consistent progress with its investigational candidates makes the company one of the most lucrative takeover options for other large players in the drug/biotech space at the moment. (Read more: Agios Pharmaceuticals Shares Rise on Buyout Speculation)
Companies with product/pipeline portfolios comprising rare disease drugs are in great demand as there is less competition in the concerned space and the expensive treatments can garner huge profits. BioMarin is one such drug developer with a market cap of around $15 billion.
BioMarin’s key orphan disease drugs, Vimizim and Kuvan, are doing well, backed by strong underlying patient demand trends. Also, another orphan drug Brineura’s earlier-than-expected approval this year for the treatment of children with CLN2 disease is likely to be a huge boost to BioMarin. A potential approval for pegvaliase is expected next month.
BioMarin has already been a target of takeover speculation. Companies like Gilead, Amgen and Roche might be interested in buying BioMarin.
BioMarin carries a Zacks Rank #3.
Vertex Pharmaceuticals, Inc.
For Vertex, a consistent expansion in patient population raised revenues quarter to quarter throughout 2017. Moreover, the approval to its third cystic fibrosis (“CF”) drug, Symdeko (tezacaftor/ivacaftor combination), will further drive the company’s sales. The company is hopeful that a positive trend of CF sales will continue in 2018 as it gains additional reimbursement approvals for Orkambi in the ex-U.S. markets
Meanwhile, the company is focused on triple combination therapies for treating CF, which will further expand its patient population. The market cap of Vertex is more than $40 billion.
Vertex carries a Zacks Rank #3.
Incyte Corporation
Incyte’s strong oncology portfolio makes it an attractive pick for companies, namely Gilead, Amgen and Bristol Myers. Incyte’s market cap is also around $15 billion.
The primary reason why Incyte is ready for buyout is because of the encouraging performance of its two marketed products such as, Jakafi and Iclusig. Jakafi is seeing a strong sales performance, driven by solid patient demand in the approved indications.
The company is also working on its further label expansion. Meanwhile, Incyte’s pipeline boasts candidates like immune therapy epacadostat, which is being studied in combination with other drugs for the cure of cancer and rheumatoid arthritis.
Incyte carries a Zacks Rank #3.
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With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Agios Pharmaceuticals, BioMarin Pharmaceutical, Vertex Pharmaceuticals and Incyte
For Immediate Release
Chicago, IL – April 16, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Agios Pharmaceuticals, Inc. (AGIO - Free Report) , BioMarin Pharmaceutical Inc. (BMRN - Free Report) , Vertex Pharmaceuticals, Inc. (VRTX - Free Report) and Incyte Corporation (INCY - Free Report) .
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Friday’s Analyst Blog:
Pharma M&A Activity: 4 Potential Buyout Targets
The current year began on widespread optimism, predicting a significant increase in drug/biotech mergers and acquisitions (M&A) activity, mainly buoyed by the new tax law enacted in December 2017 and purchasing newer technologies. The tax reform has lowered the tax rate and provided a low-tax window to bring back huge cash stashed overseas. These will certainly improve the cash position of the companies and fuel M&A activities amid struggling organic growth.
With a quarter of the year already gone by, we have seen quite a few billion dollar buyout deals being inked. For instance, Celgene Corporation acquired Juno Therapeutics to add a CAR-T therapy to its pipeline for approximately $9 billion. Moreover, the company is in process to complete the acquisition of Impact Biomedicines for an upfront amount of $1.1 billion. Also, Sanofi in a bid to strengthen its blood disorder pipeline purchased Bioverativ for $11.6 billion and even offered to buy Belgian Biotech Company, Ablynx for $4.8 billion.
Additionally, Pfizer is aggressively on the lookout for a buyer for its Consumer Healthcare unit after British firms Glaxo and Reckitt Benckiser Group withdrew from discussions. However, Glaxo announced its acquisition of Novartis’ stake in their healthcare joint venture for $13 billion. Meanwhile late last month, Takeda also confirmed its intention to integrate Dublin-based Shire into its portfolio to boost its core therapeutic areas.
Moreover, this week bore news of a couple of more M&A deals. A brief description of the two deals is as follows:
Novartis to Buy AveXis
Novartis inked a deal to acquire the U.S. based clinical stage gene therapy company, AveXis, to boost its presence in gene therapy and neuroscience space.
AveXis’ lead gene therapy candidate, AVXS-101, is being developed to treat spinal muscular atrophy ("SMA"), a neurodegenerative disease, accounting for the highest genetic cause of death in infants. The only approved treatment for SMA is the Biogen’s Spinraza.
Per the agreement, Novartis will close the acquisition in an all cash deal of $8.7 billion. The company proposed a cash-tender offer of $218 per share for AveXis’ common stock. The deal is expected to culminate in the second half of 2018. (Read more: Novartis Inks $8.7 Billion Gene Therapy Deal to Buy AveXis)
Alexion-Wilson Deal
Alexion Pharmaceuticals announced that it will consolidate Sweden-based Wilson Therapeutics in its portfolio to add a late-stage candidate to its pipeline for the treatment of Wilson disease, a rare genetic disorder. The acquisition is line with the company’s strategy to diversify its portfolio and lower its dependence on its blockbuster drug, Soliris.
Alexion has offered 232 Swedish Krona in cash for each outstanding share of Wilson Therapeutics, which translates into a total transaction value of $855 million. The buyout is expected to get wrapped up this quarter. (Read more: Alexion to Acquire Wilson Therapeutics for $855M)
In this article, we suggest three drug/biotech companies as logical acquisition targets this year. The parameters counting for buying a drug/biotech stock are the current sales performance of its drugs/products, prospects of future sales growth and the quality of the company’s pipeline. Takeovers of small-cap drug/biotech companies are very difficult to forecast and are quite frequent in the said space. Hence, these have been excluded from the discussion.
Agios Pharmaceuticals, Inc.
Agios Pharmaceuticals’ share price is witnessed to rally this week on speculations that the company might be bought by other big players in the pharma and biotech industry.
The company received an FDA approval for Idhifa (enasidenib) in August 2017 for treatment of acute myeloid leukemia (“AML”) with IDH2 mutation, lending a huge boost to its immense commercial potential in the target market. Agios’ ivosidenib is under review in the United States as a therapy for relapsed/refractory AML with IDH1 mutation. The candidate is also being developed for addressing advanced hematologic malignancies.
Agios’ pipeline also includes a mid-stage genetic diseases candidate. A consistent progress with its investigational candidates makes the company one of the most lucrative takeover options for other large players in the drug/biotech space at the moment. (Read more: Agios Pharmaceuticals Shares Rise on Buyout Speculation)
Agios carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
BioMarin Pharmaceutical Inc.
Companies with product/pipeline portfolios comprising rare disease drugs are in great demand as there is less competition in the concerned space and the expensive treatments can garner huge profits. BioMarin is one such drug developer with a market cap of around $15 billion.
BioMarin’s key orphan disease drugs, Vimizim and Kuvan, are doing well, backed by strong underlying patient demand trends. Also, another orphan drug Brineura’s earlier-than-expected approval this year for the treatment of children with CLN2 disease is likely to be a huge boost to BioMarin. A potential approval for pegvaliase is expected next month.
BioMarin has already been a target of takeover speculation. Companies like Gilead, Amgen and Roche might be interested in buying BioMarin.
BioMarin carries a Zacks Rank #3.
Vertex Pharmaceuticals, Inc.
For Vertex, a consistent expansion in patient population raised revenues quarter to quarter throughout 2017. Moreover, the approval to its third cystic fibrosis (“CF”) drug, Symdeko (tezacaftor/ivacaftor combination), will further drive the company’s sales. The company is hopeful that a positive trend of CF sales will continue in 2018 as it gains additional reimbursement approvals for Orkambi in the ex-U.S. markets
Meanwhile, the company is focused on triple combination therapies for treating CF, which will further expand its patient population. The market cap of Vertex is more than $40 billion.
Vertex carries a Zacks Rank #3.
Incyte Corporation
Incyte’s strong oncology portfolio makes it an attractive pick for companies, namely Gilead, Amgen and Bristol Myers. Incyte’s market cap is also around $15 billion.
The primary reason why Incyte is ready for buyout is because of the encouraging performance of its two marketed products such as, Jakafi and Iclusig. Jakafi is seeing a strong sales performance, driven by solid patient demand in the approved indications.
The company is also working on its further label expansion. Meanwhile, Incyte’s pipeline boasts candidates like immune therapy epacadostat, which is being studied in combination with other drugs for the cure of cancer and rheumatoid arthritis.
Incyte carries a Zacks Rank #3.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
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About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.