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 Biotech / Medical | Sepracor-Looks very promising

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To: quidditch who wrote (8214)4/11/2005 2:02:49 PM
From: Robohogs   of 10280
 
No, actually the 2007 options had vols compress from 40-50s to 20s when the takeover first surfaced. The issue is that the LT nature of the option gets wasted in a takeout because of either cash replacing shares or replacing a high vol stock with a low vol stock. The recent uptake into the 30s for most of the 2007 series implies less certainty of a takeover. The vols started re-emerging about 2 weeks ago though and are recompressing a small bit today.

Jon

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To: Robohogs who wrote (8215)4/11/2005 2:20:47 PM
From: quidditch   of 10280
 
I see what you and Peter are saying, thanks. As I said, I haven't been following the IV's or the LEAPs, and maybe I should be. Either way, today's news helps me feel a bit more comfortable hanging in with my SEPR position, in a market I can't help but feel is in for more misery, not that BTs haven't borne enough for an entire market.

quid

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To: quidditch who wrote (8216)4/11/2005 2:24:04 PM
From: Robohogs   of 10280
 
I am very long SEPR but I cannot help but worry when all the good news in the world keeps getting met with selling. It seems that until a new biotech can break out of the mold and prove that ICOS is the exception, bios with products will never go up again. I see more bios near profitability than I ever have (or can remember) and they are all getting killed.

Jon

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To: Robohogs who wrote (8217)4/11/2005 2:34:53 PM
From: quidditch   of 10280
 
And it doesn't help when the supposed paradigm to which certain biotechs once profitable aspire, the integrated pharmaceuticals, are at the bleeding edge of investor sentiment.

GILD and AMGN are holding up well though.

Of course, neither of those do I own. Rather, ELN and CTIC, plus some other notably underperforming representatives, are in my stable. (Steinbrenner may well have the Derby favorite in his.)

quid

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To: Robohogs who wrote (8217)4/11/2005 2:53:56 PM
From: rkrw   of 10280
 
market obviously had been discounting an outright rejection of CR :-)

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To: rkrw who wrote (8219)4/11/2005 3:01:03 PM
From: tom pope   of 10280
 
If so, it took 'em some time to register that information.

What's wonderful about all this is that I haven't been in SEPR since I told a friend it was a buy in the 10-12 range.

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To: quidditch who wrote (8218)4/11/2005 3:12:37 PM
From: Robohogs   of 10280
 
GENZ and DNA and CHIR are also acting well. So it is only the next tier down acting bad and then the next tier after that - run for your lives.

Jon

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To: Robohogs who wrote (8217)4/11/2005 6:14:13 PM
From: Icebrg   of 10280
 
>> It seems that until a new biotech can break out of the mold and prove that ICOS is the exception>>

But ICOS is a very different proposition. They have more or less completely lost their entire clinical pipeline. The only thing remaining are some so far feeble efforts to expand the label of Cialis. And it is normally expectations of the next big thing that keeps biotech valuations high.

But Icos doesn't have any next thing at present. Neither big nor small. And the present management appears less than skilful in the R&D game. This is however not entirely correct, as I see it. Almost all those drugs, which have failed were inherited from the Rathman era. If the current set of managers is any good or not will only be proven by the next crop of drugs. But these have not reached the clinic yet, so the market is not prepared to give the company the benefit of its doubts.

If Icos was a bond. What kind of return would it have to generate in order to defend its current valuation?

Erik

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To: Icebrg who wrote (8222)4/11/2005 6:51:27 PM
From: Biomaven   of 10280
 
Lunesta is going to be much cheaper to market than Cialis - no need to go to the superbowl. It's all going to be late-night infomercial/cable stuff.

Sometimes I vaguely wonder if Lilly is spending a bunch now so that ICOS is weak so that they can munch them. (I have no ICOS position now, do I recall ever having one).

At this point we mostly just get to wait for the script numbers. If they are good enough, they will take the stock with them, no matter what the analysts say.

Peter

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To: Robohogs who wrote (8207)4/11/2005 7:10:22 PM
From: Rocky9   of 10280
 
"Steve Smith of TheStreet.con"

1) I assume the .con is not a typo. First time I have seen that reference, but I do agree. LOL

"recommends closing out option positions 5-10 days prior to expirating, claiming the illiquidity and gamma boost during the last few weeks can be tougher for non-pros to trade."

2) I thought that it would be better to close the position on Friday - in part due to the problems he mentions, and in part due to fears of Ambien CR approval.

3) My regret that I closed the position on Friday has now disappeared. As I said, SEPR will be volatile, if nothing else.

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