To Rajiv Kaul, who manages the biggest U.S. biotechnology fund, a correction is just a discount on his favorite stocks. Kaul, who runs the $13.4 billion Fidelity Select Biotechnology Portfolio, said many drug companies’ research pipelines are still primed to pay off, and dealmaking isn’t going away. He expects the industry to bounce back over the next few years as new antibiotics, gene therapies and drugs for cancer and Alzheimer’s disease begin to reach the market. Kaul also manages the $3.3 billion Fidelity Advisor Biotechnology Fund.
A rally in pharmaceutical stocks has made top managers at four biotechnology companies some of the highest-paid executives in the U.S. Hans Bishop, chief executive officer of Juno Therapeutics Inc., a Seattle-based developer of cancer therapies, was awarded salary, options and restricted shares in 2014 that were valued at $88.2 million as of year end, making him the 11th highest-paid executive in the U.S., according to the Bloomberg Pay Index, a daily ranking of the 100 top-paid executives. The awards were worth $7.3 million before the company’s initial public offering in December.
Celgene Corp. Chief Executive Officer Robert J. Hugin said his partnerships with companies in the early stages of drug development are bearing fruit, yielding more than half of eight new compounds the company aims to put into human testing over the next 18 months.
Biotech ETFs have recently shown vulnerability. For example, the iShares Nasdaq Biotechnology ETF (IBB) , the largest biotech ETF by assets, fell nearly 4% last week on its way to shedding nearly $200 million in assets and there is talk that IBB is forming a bearish head and shoulders chart pattern. [How to Deal With Biotech ETF Trouble]
BIO Investor Forum to be held October 20-21 in San Francisco, California The Biotechnology Industry Organization (BIO) has opened registration for the 14th Annual BIO Investor Forum, the international biotech investor conference focused on investment strategies for early stage and established private companies as well as emerging public companies. The event will take place October 20-21, 2015, at the Parc 55 Hotel in San Francisco.
When Celgene Corp. agreed to buy Receptos Inc. for $7.2 billion this month, both companies soared on the news. Little did investors know that Celgene had a Receptos deal in its grasp in 2013, when the drugmaker was trading for an eighth of the final price.
Sanofi agreed to contribute $2.2 billion to work with Regeneron Pharmaceuticals Inc. on therapies that harness the immune system to fight cancer. Sanofi will give Regeneron an upfront payment of $640 million to work on at least four experimental treatments, including one that has entered early-stage trials. Regeneron will get an additional $375 million from Sanofi if it meets certain sales goals. Sanofi will also invest $1.15 billion in the research, while Regeneron will add $485 million.