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Biotech outperforms market in May
June 02, 2008FOR IMMEDIATE RELEASE
Contact: Peter Winter, Editorial Director
Burrill & Company
Tel: 415-591-5474
Email: pwinter@b-c.com
SAN FRANCISCO – June 2, 2008 –Biotech along with the broader technology stocks performed well in May with the Burrill Biotech Select Index, a price-weighted index tracking 20 of biotech’s “blue chip” companies, finishing up 3.2% and the Nasdaq was up 4.6%. Rising oil prices, however, spurred investor uneasiness, and the Dow Jones industrial average finished the month in negative territory, down 1.5%. Since oil prices hit a record $135 per barrel mid-month, the markets have reflected concern about the effect of soaring fuel costs on inflation and on consumer spending, a key driver of economic growth.
“The highly anticipated annual American Society of Clinical Oncology (ASCO) meeting, which started in Chicago on the last day of May certainly helped keep investors focused on biotech land,” said G. Steven Burrill, CEO, Burrill & Company, a San Francisco based global leader in life sciences with activities in Venture Capital, Private Equity, Merchant Banking and Media. “During the meeting 5,000 studies will be discussed by 30,000 oncologists and Wall Street analysts have been busy pouring over the ASCO abstracts since cancer drugs make up the bulk of sales for many biotech companies.”
Shares of industry heavyweights Amgen and Genentech finished May up 5% and 4% respectively. Both companies were reporting data from several ongoing cancer trials at ASCO. Outside the ASCO meeting buzz, Amylin Pharmaceuticals was the biggest mover in the Burrill Biotech Select Index group, finishing the month up 15% on the strength of an analyst upgrade.
The Burrill Mid Cap Biotech Index recovered one-third of its value following its 18% tumble in April. Contributing to the over 6% gain were Third Wave Technologies, Osiris Therapeutics, and Sequenom with all three seeing their share values jump 20%.
Third Wave reported that it is acquiring Stratagene’s Full Velocity family of worldwide patents and patent applications from Agilent Technologies Inc. The new chemistry opens new research markets to the company, including the $500-million quantitative PCR market. Osiris Therapeutics said that it was selling its Osteocel business line to NuVasive Inc. in a deal that could be worth $85 million. In a separate agreement worth up to an additional $52 million in revenue to Osiris, the company will process and supply NuVasive with Osteocel for up to 18 months.
Biotech IPOs still on hold
“As we indicated last month, the first half of this year will continue to be dominated by the macro economic factors such as inflation, recession and credit market turmoil”, noted Burrill. “It is not surprising that IPO pricings in general are down 70% compared with the same period in 2007.”
There were no signs of any biotech IPOs in May and only Aldagen, which is developing proprietary regenerative cell therapies added itself to the IPO-pending queue. The company has four product candidates in clinical trials the most advanced is ALD-101 in Phase III to evaluate its efficacy in improving umbilical cord blood transplants to treat inherited metabolic diseases in pediatric patients.
Market cap
The industry’s market cap closed May at $457 billion, an increase of 2.5%, even in the wake of the loss of Millennium Biotech’s market capitalization of around $8 billion. Genentech’s market cap closed the month at $74.5B; Gilead Sciences was at $51B and Amgen remained in third place at $48 billion.
Biotech Indices
|
Index
|
12/31
2007
|
1/31
2008
|
2/28
2008
|
3/31
2008
|
4/30
2008
|
5/30
2008
|
%
change
Month
|
%
change
Year
|
|
Burrill Biotech
Select
|
331.52
|
331.31
|
318.05
|
330.24
|
329.52
|
340.1
|
3.21%
|
2.59%
|
|
Burrill Large
Cap Biotech
|
437.71
|
438.87
|
434.25
|
437.02
|
444.63
|
450.49
|
1.32%
|
2.92%
|
|
Burrill Mid-Cap
Biotech
|
201.89
|
179.33
|
161.7
|
155.2
|
157.93
|
168.51
|
6.70%
|
-16.53%
|
|
Burrill Small Cap
Biotech
|
137.6
|
148.3
|
150.15
|
146.74
|
119.65
|
128.17
|
7.12%
|
-6.85%
|
|
Burrill Genomics
|
104.29
|
93.64
|
86.83
|
88.3
|
91.48
|
90.03
|
-1.59%
|
-13.67%
|
|
Burrill AgBio
|
198.83
|
193.82
|
197.08
|
185.94
|
199.58
|
201.65
|
1.04%
|
1.42%
|
|
Burrill Industrial
|
158.66
|
146.41
|
160.09
|
159.98
|
170.78
|
164.33
|
-3.78%
|
3.57%
|
|
Burrill Diagnostic
|
159.43
|
151.53
|
152.72
|
142.23
|
149.65
|
156.13
|
4.33%
|
-2.07%
|
|
Burrill Nutraceutical
|
593.04
|
556.24
|
546.94
|
536.46
|
515.8
|
529.74
|
2.70%
|
-10.67%
|
|
NASDAQ
|
2652.28
|
2389.86
|
2271.48
|
2279.1
|
2412.8
|
2522.66
|
4.55%
|
-4.89%
|
|
DJIA
|
13264.82
|
12650.36
|
12266.39
|
12262.89
|
12820.13
|
12638.32
|
-1.42%
|
-4.72%
|
|
Russell 2000
|
766.03
|
713.3
|
686.18
|
687.97
|
715.94
|
748.28
|
4.52%
|
-2.32%
|
|
Amex Biotech
|
786.5
|
749.38
|
721.95
|
737.41
|
745.53
|
759.18
|
1.83%
|
-3.47%
|
|
Amex Pharma
|
338.52
|
316.45
|
305.15
|
295.23
|
300.05
|
302.49
|
0.81%
|
-10.64%
|
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About Burrill & Company
Founded in 1994, Burrill & Company is a San Francisco-based global leader in life sciences with activities in Venture Capital, Private Equity, Merchant Banking and Media. The Burrill family of venture capital funds has over $950 million under management and its merchant banking business is one of the industry leaders in life sciences transactions.
Burrill is also the creator, sponsor and facilitator of over a dozen leading industry conferences worldwide and publishes a wide range of bio-intelligence reports. Burrill’s flagship publication is its annual “State of the Industry” report, the 22nd Edition is entitled Biotech 2008: Life Sciences – A 20/20 Vision to 2020.
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