BTA 0.00% 57.0¢ biota holdings limited

biota / us biotechs

  1. 2,961 Posts.
    This is a report from todays FIN.

    The interesting point is the market movement of the smaller biotech in relation to the larger taking a stake. If The Jap pharma company takes a MAJOR equity stake in BTA either by direct capital or a new rights issue then BTA at present is extremely cheap.

    20% increase on todays price. Shows 70c plus.
    Again with such a low capitalisation we could see a fast run to three figures.
    Biotechs pass the acid test
    Author: Martin Pretty
    Date: 29/05/2003
    Words: 719
    Publication: The Australian Financial Review
    Section: Equities
    Page: 25

    The much-maligned biotech sector has been a surprising haven over the past year.

    An investor tracking the S&P/ASX 200 index would have fared worse than if he or she had spread the risk across a portfolio of local biotech-related stocks.

    There will always be a large element of risk attached to any company hoping to profit from research or exploration, but there are many indications that the biotech management ranks have realised they can't keep burning cash in the chase for one breakthrough.

    Many local biotechs have diversified into cash-generating activities.

    Analysts are pointing to an evolution in the management of these companies for investment returns.

    While the Intersuisse's biotechnology index has recovered all its losses of the past year, the S&P/ASX 200 has remained 11.1 per cent short.

    In the big league, the Nasdaq biotech index has risen 12.5 per cent and has bounced by about 40 per cent from its lows in mid-March.

    "I don't think its necessarily a change in market sentiment," said eG Capital analyst Alison Coutts.

    "It's not a dot com boom, these business models are not flawed."

    Bioshares analyst David Blake said the rise in biotech values in the US should hold at the higher levels, noting that the blue-chip end of the American biotech scene was on a roll that might lift second and third-tier players.

    But there was also a downside.

    "Biotech is going to be like every other sector in Australia, where it pays for the sins of AMP," Mr Blake said. AMP has done more damage to investors' perspective of the sharemarket than even HIH.

    "Money that would normally be available for higher-risk strategies isn't there."

    Sentiment has been boosted over the past few weeks by several promising announcements in the US and locally.

    News from NYSE-listed Genentech of positive "phase III" trial results for its monoclonal antibody drug Avastin has dominated headlines.

    Avastin was evaluated as a combination therapy with three other chemotherapy drugs to treat metastatic colorectal cancer.

    There are several other monoclonal antibodies in development.

    "This news justifies a second look at companies that have a drug discovery and development focus on anti-angiogenesis," said Mr Blake, nominating Progen and Bionomics.

    "The news also highlights the potential of monoclonal antibody approaches in oncology, and companies that operate in this area include Bionomics and Prima Biomed."

    Mergers, acquisitions and collaborations are also becoming strong market influences, despite the failure this week of US-based Cephalon to complete its takeover offer for Sydney's SirteX Medical.

    Last week, US biotech giant Amgen announced it would invest $US125 million ($190 million) to collaborate with the far smaller Tularik. The latter's stock shot up 40 per cent in response to the news that Amgen would take a 20 per cent stake.

    Locally, Genetic Technologies yesterday announced a cross-licensing agreement with New Jersey-based Orchid Biosciences.

    Ms Coutts said: "Genetic Technologies could well put Australia on the international genetic testing map.

    "Their vision is to be the biggest genetic-testing company in the Asia-Pacific region. As we learn more about how our genes influence our likelihood of getting certain diseases, genetic testing will grow in importance."
    Biota Holdings said on Tuesday it had signed a letter of intent with Japanese pharmaceutical company Sankyo.

    The letter anticipates an agreement that will see the two companies pooling their long-acting influenza drug programs and jointly seeking development and commercialisation partnerships.

    Mr Blake said the deal was a positive sign from Biota's new chief executive, Peter Molloy, who has been in the job for less than a year.


    Well make up your own mind - always seek quality Finacial advice prior to any investment decision and read the red.
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