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Over 30 years of investing in individual stocks. Extensive business experience with small to mid-size companies, including as CEO. Many hundreds of blog posts on financial and economic matters since 2008. Focus on value with catalysts for upside price action. Background as a physician and... More
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  • Patent Interference Hearing Against Biogen's Tecfidera Announced

    I recently wrote a bullish analysis of Biogen (NASDAQ:BIIB). Today, Seeking Alpha's Doug House reported on a patent interference hearing that could do real harm to Biogen. Here is the headline that the other company, Forward Pharma A/S (NASDAQ:FWP) put out in a press release today:

    U.S. Patent Office Declares an Interference Between Forward Pharma and Biogen Regarding the Treatment of Multiple Sclerosis With 480 mg Daily Dose of DMF, the Active Ingredient in Tecfidera(NYSE:R)

    The key to the PR is this sentence:

    Should the Company prevail in the interference, the Company's '871 patent application will issue and the claims of Biogen's '514 patent will be cancelled.

    At this point, I do not know how to assess this. If Tecfidera loses patent protection, it will be open to generic competition. Then it would be difficult to see Forward get much in the way of sales from its own formulation if the indication is MS. So, maybe there will be a licensing deal. Just a guess.

    This is news to me, so all I can say at this point is that it appears to add an extra layer of uncertainty into a BIIB investment.

    Apr 14 2:48 PM | Link | 3 Comments
  • Lots Of FUD On Apple Watch Launch Day Looks Bullish For The Stock

    The Watch sold out big-time online (no one cared they had never actually put one on their wrist), including the $10,000 and up Edition.

    But the FUD attack from the largest media sources was intense. Here are some typical headlines on Yahoo! Finance (NASDAQ:YHOO):

    Apple Watch buyers are pretty grumpy to hear delivery date pushed to JuneThe hidden danger in Apple stockMuted Debut for Apple Watch With Sparse Crowds in Europe and Asia

    These were not just bloggers. The first one was from MarketWatch, a WSJ-affiliated site; the second was from Fortune (but not from PED); the third was a Bloomberg News headline. Wow. When in conflict with the facts, which are that demand is exceeding Watch supply, it has always paid to buy AAPL and trade against the FUD-sters.

    Apple's P/E is way below the market. It has another hit product that strengthens its ecosystem as well as the bottom line.

    Any stock can do anything, so there's no way to know, but I'm adding more AAPL on the open if it opens down despite an already-overweight position in the stock.

    Tags: AAPL
    Apr 10 9:28 AM | Link | 10 Comments
  • Gilead's Hepatitis Drugs Have Their First Serious Drug-Drug Interaction

    Gilead Sciences (NASDAQ:GILD) has alerted health care providers, once called physicians, that sofosbuvir has probably been implicated in exacerbating the effects of the type III anti-arrhythmic drug amiodarone and causing excessively slow heart rates. There was one death and there were three pacemaker insertions. The interactions were seen both with Sovaldi (sofosbuvir) and Harvoni (sofosbuvir plus ledipasvir).

    Oddly, Gilead itself is in Phase 2 clinical trials using a next-generation analogue of amiodarone called dronedarone (Multaq) in combination with Gilead's ranolazine (Ranexa) to treat paroxysmal atrial fibrillation, in which the heart generally beats too fast and irregularly.

    I have not seen the warning; I would suppose that it would apply both to amiodarone and dronedarone, but that's not a certainty.

    In any case, these two anti-arrhythmics are not especially common drugs. I do not think this news will affect Gilead's profits in any material way. If the stock happens to sell off tomorrow out of apparent nervousness about this news item, I would expect it to reverse shortly.

    The bigger issue with GILD is, as I have sadly said some time ago, that EPS estimates for 2016 are steadily eroding. That's not what the Street wants from a stock that is up 5X since late 2011.

    Tags: GILD, Biotech
    Mar 22 10:09 PM | Link | 3 Comments
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