The big boys in pharma have had their time to shine, now they are getting long in the tooth and need product. They need product like media aches for content. They need new drug content. Old pharma trades like autos.
Merck ($MRK) Abbott Labs ($ABT) Pfizer ($PFE) Bristol-Myers ($BMY) are dying on the vine. Their pipelines for the most part are unexciting, and even if they get a blockbuster, (defined as about a billion dollars for a drug), it doesn’t much move their needle. Don’t get me wrong they are wonderful companies.
So what’s the solution? Wait five years to get something approved or buy something now to be competitive? They need to be buyers. They will buy the baby bios and medium sized biotechs. They will also buy the big ones eventually, they have to. $GILD $CELG, $BIIB, $MDVN, $ARWR, $ICPT and $JAZZ are all takeout candidates.The list goes on. Buy or die.
Just four months ago they said biotech was done, today $IBB broke above a downtrend and is now about a percent away from revisiting their all time highs. I would not want to be short in front of a takeover or a new drug approval. That’s why there is a bid in these things. All going higher. Be short at your peril.
Long $ARWR, $RCPT, $MDVN, $RARE and other assorted deviant names.
if you want to see what we’re doing in the space.
When was the last time Bristol-Myers did this?
