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JPM Healthcare Conference

The following quote regarding Insmed (INSM) was brought to my attention from a commentor on Seeking Alpha and I figured it’s something that you would be interested in.

“In 2009, we did 51 deals keeping up with our rigorous pace even during the merger planning period. And you can see from this slide, we made significant advancements in continuing that cardiovascular franchise as we move forward with an a-fib product in a relationship with Cardiome and Portola relationship with Factor Xa. So you can see that we continue a strategy of continuing to build the atherosclerosis/cardiovascular franchise.

We also made relationships with glaucoma and for infectious disease, so I think this is a good illustration that we continue to look at relationships and licensing and biotech acquisitions as a key part of the strategy moving forward.

And as we announced the Merck (NYSE:MRK) BioVenture in the last year or so, we continue to do acquisitions with Insmed and relationships with Insmed and Avecia for a biological standpoint to build our infrastructure and manufacturing capabilities. So I think this will be an important part of our strategy. It’s not put on the back burner as some have suggested that would take place.” – Merck transcript from JPM Healthcare Conference (pdf)

This conference took place on Jan 12, 2010 and if you look at the trading volume, it’s clear that this statement was the cause of the spike in volume that took place afterwards.

Some Fun Speculative Thoughts

I also checked out the Yahoo boards as there seems to be a flurry of activity and speculation.

Some are saying that the CEO made a mistake with his statement while he was really referencing the purchase of the INSM follow-on biologics (fob) manufacturing facility for IPLEX. Now while a CEO can easily make a mistake as well, directly referencing INSM two times while using ongoing action words doesn’t seem like much of a mistake.

Besides, Merck holders and not INSM holders should be more worried if the CEO is getting confused with the merger deals that took place. 51 deals in one year is a lot but to specifically mention INSM twice must mean something, right?

Low Risk, High Return with INSM

I don’t want to delve too much into it. But remember that INSM is still trading at less than its net net value. There hasn’t been much action or news on the progress of the company’s strategic alternatives but that is fine with me. The worst that can happen is basically nothing for a company just sitting on a hoard of cash and not doing much. The stupid thing would be to think that just because you have cash, you have to do something. That’s when you start making stupid acquisitions and decisions.

And as I concluded in my previous INSM quarterly analysis, it looks like management has a good handle of cash management and operations.

Disclosure: I own shares of INSM at the time of writing. Maybe it’s time for more?