Booming Biotech Industry a Hotbed of Merger & Acquisition Activity and Speculation in 2012
July 03 2012 - 8:20AM
Marketwired
Despite the recent economic slowdown, the Biotech Industry has been
home to some of the strongest performers in the market in 2012. The
SPDR S&P Biotech ETF (XBI) and the First Trust NYSE Arca
Biotech Index ETF (FBT) year-to-date are up 30 percent and 32
percent, respectively. As the world continues to face evolving
health challenges the discoveries of new therapeutics and vaccines
are critical. Five Star Equities examines the outlook for companies
in the Biotech Industry and provides equity research on Human
Genome Sciences (NASDAQ: HGSI) and Lexicon Pharmaceuticals, Inc.
(NASDAQ: LXRX).
Access to the full company reports can be found at:
www.FiveStarEquities.com/HGSI www.FiveStarEquities.com/LXRX
Expiring patents have been a major dilemma for pharmaceutical
companies. New products that are being introduced are not expected
to generate the same level of revenues of the products that have
lost patent protection. The Obama administration is currently
analyzing a proposal in which the exclusivity period for biologics
would be cut down by 5 years. Mergers & Acquisitions activity
is expected to pick up in 2012 as companies scramble to look to
make up for loss revenues. M&A allow companies to acquire
products that are already proven in the market place without the
hassle and costs associated with research and development.
"Many of the pharmaceutical companies started producing
everything in-house out of their own R&D organizations and over
time they've failed to produce enough that way. So the industry is
now coalescing around a 50-50 model of half on your own and half
bought in. There are some things we'll do for ourselves but we need
to be constantly on the lookout for new technologies," said Angus
Russell, Chief Executive of Shire PLC.
Five Star Equities releases regular market updates on companies
in the Biotech Industry so investors can stay ahead of the crowd
and make the best investment decisions to maximize their returns.
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Human Genome Sciences is a biopharmaceutical company. The
company's main products are BENLYSTA for the treatment of systemic
lupus erythematosus (SLE) and raxibacumab for inhalation anthrax.
The company rejected a takeover bid from GlaxoSmithKline of $13 per
share ($2.6 billion). Shares of the company jumped Friday on
speculation that the company might receive an higher offer from
GlaxoSmithKline.
Lexicon is a biopharmaceutical company focused on discovering
breakthrough treatments for human disease. Lexicon currently has
five drug programs in mid-stage development for diabetes, carcinoid
syndrome, irritable bowel syndrome, rheumatoid arthritis and
glaucoma, all of which were discovered by Lexicon's research team.
Shares of the company have soared over 80 percent year-to-date.
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