SAN FRANCISCO, Sept. 4 /CNW/ -- "Biotech rode a surging market in the
final trading days on the capital markets before the Labor Day holiday
weekend," said G. Steven Burrill, CEO, Burrill & Company, a San Francisco
based global leader in life sciences whose principal activities are in Venture
Capital, Merchant Banking and Media. "The Burrill Biotech Select Index closed
the month up 4.4% well ahead of the Dow's 1% gain and NASDAQ's 2% increase."
Driving the Burrill Biotech Select Index were Onyx Pharmaceuticals (up
42%) and Vertex Pharmaceuticals (up 21%). Onyx' jump was based on positive
clinical data, while Vertex continued its upward climb as investors continue
to bet that telaprevir, the company's experimental hepatitis C drug, will
become a blockbuster. Amgen's woes continued and in the wake of health
concerns surrounding its anemia drugs, Aranesp and Epogen, announced that it
would shed 12-14% of its employees and cancel nearly $2 billion worth of
capital projects. The company's shares closed down 7% for August and are down
27% year-to-date. It was not so long ago that industry heavyweights Amgen and
Genentech were flirting with market caps of $100 billion. At the end of
August, Amgen's market cap stood at $54 billion and Genentech's market cap was
It was a very turbulent month to say the least with wild swings in the
capital markets with investors being spooked by weak economic data and ongoing
credit concerns. "We haven't seen this kind of volatility since 2002," added
Burrill. "At this time five years ago biotech was at its lowest point and
since then has been on a steady upward climb driven in large part by biotech's
blue chip companies. Our analysis, in the Burrill Biotechnology Monthly
Report, reveals that an investment in biotech at that time would have yielded
a very healthy 13% CAGR return so far.
"In addition, the biotech industry is transitioning from one focused
principally on treating sickness to one that is promoting 'wellness'. The era
of personalized medicine is upon us...one that emphasizes predictive and
preventive medicine," Burrill continued. "Not surprisingly, diagnostics and
nutraceuticals companies have been very successful riding this new paradigm.
The Burrill Diagnostics Index, this year to date, for example, is ahead of all
other indices and heading into the fall, which is traditionally good for
biotech, we expect this trend to continue. In addition, we are seeing
companies focused in the personalized medicine space beginning to file for
IPO's and test the appetite of investors for this new market opportunity."
FDA and biotech
Over the next few months the FDA is scheduled to pass judgment on at
least 12 biotechnology-produced medicines. Success for a majority of these
could spell a major surge in the industry's fortunes. "We have already seen a
prelude to this with the 42% surge in the value of Onyx Pharmaceuticals'
shares in August following positive clinical data," noted Burrill, "Onyx and
its partner Bayer AG announced an early end to a trial its drug Nexavar in
advanced hepatocellular carcinoma. Having been granted priority review status
by the FDA, the drug is on the fast track for regulatory clearance."
Biotech IPO review
It was another slow month for biotech IPOs with only two companies
getting their offerings completed. WuXi PharmaTech, a China-based
pharmaceutical and biotechnology research and development outsourcing company.
The firm raised $212 million offered 15.1 million ADSs, including an
over-allotment, at $14 per ADS, a 16.6% premium to the midpoint of its
proposed $11 to $13 range. The company's shares closed the month at $26.25 up
87%. Sucampo Pharmaceuticals, an emerging pharmaceutical company focused on
the discovery, development and commercialization of drugs based on prostones,
a class of compounds derived from functional fatty acids that occur naturally
in the human body. The company priced its 3.75 million shares at $11.50 each,
23% below the midpoint of the proposed $14-$16 price range. Its shares jumped
10.8% by the end of August.
Eight companies added themselves to the IPO runway:
-- Adnexus Therapeutics, which is focused on discovering, developing, and
commercializing the proprietary drug class called Adnectins. Adnexus'
first product candidate, Angiocept (CT-322), is in Phase 1 clinical
development in oncology in the United States. Adnectins are designed
and optimized using PROfusion, the company's patented protein design
engine that enables rapid optimization of protein therapeutics.
-- Anacor Pharmaceuticals, which is developing novel small-molecule
therapeutics derived from boron chemistry. The company has focused
initially on developing topical applications of its compounds to treat
fungal, bacterial and inflammatory diseases and its most advanced
product candidate is AN2690, a topical antifungal in development for
the treatment of toenail onychomycosis, which is a fungal infection of
the nail and nail bed.
-- ARYx Therapeutics, focuses on discovering and developing product
candidates designed to eliminate known safety issues associated with
commercially successful drugs,
-- Biolex Therapeutics is developing recombinant human therapeutic
proteins and monoclonal antibodies that, until now, have been
impossible or very expensive to develop in existing protein expression
-- Genoptix, Inc., a certified laboratory headquartered in Carlsbad,
California, provides personalized medicine services to hematologists
and oncologists that combine proprietary and exclusive tests with
advanced clinical techniques for comprehensive evaluation of individual
-- Insys Therapeutics, which focuses on discovering, developing and
commercializing products to address chemotherapy-induced nausea and
vomiting, pain management and other central nervous system disorders.
-- Nanosphere, which develops, manufactures and markets an advanced
molecular diagnostics platform, the Verigene system, that enables
highly sensitive genomic and protein testing on a single platform.
-- Precision Therapeutics, which develops and commercializes tests
intended to assist physicians in individualizing cancer therapy in an
effort to improve treatment outcomes, filed.
"It promises to be an interesting next few months," said Burrill, "while
the industry is still remains at the mercy of the macro-economic climate, the
stage is set for biotech to build value and finish the year with a flourish."
Index 7/31/02 12/29/06 7/31/07 8/31/07 %change %change %change
Month Year 5-Year
Biotech Select 184.23 303.96 319.81 334.03 4.45% 9.40% 81.31%
Large Cap 194.4 424.56 410.71 422.76 2.93% -0.44% 117.47%
Mid-Cap 133.51 171.55 187.88 190.01 1.13% 9.83% 42.32%
Small Cap 85.13 143.6 130.12 135.05 3.79% -6.57% 58.64%
Genomics 106.25 101.69 86.85 88.9 2.36% -14.73% -16.33%
Burrill IPO N/A 63.33 46.92 50.43 7.48% -27.49% N/A
Burrill AgBio 67.22 124.52 161.38 164.79 2.11% 24.95% 145.15%
Industrial N/A 150.85 160.53 159.54 -0.62% 5.41% N/A
Diagnostic 65.86 122.79 153.09 162.55 6.18% 25.97% 146.81%
Nutraceutical 113.12 629.56 597.97 611.27 2.22% -3.06% 440.37%
NASDAQ 1328.3 2415.29 2546.27 2596.36 1.97% 7.11% 95.46%
DJIA 8736.6 12463.15 13211.99 13357.74 1.10% 6.77% 52.89%
Russell 2000 392.4 787.66 776.12 792.86 2.16% 0.67% 102.05%
Amex Biotech 346.38 754.25 756.83 776.16 2.55% 2.89% 124.08%
Amex Pharma 297.26 345.06 334.77 338.35 1.07% -2.00% 13.82%
Burrill Biotechnology Monthly Report
The report provides detailed analysis and insight on the progress of the
biotechnology industry and examines the performance of each of the 10 Burrill
indices. Details: http://www.burrillandco.com
For further information:
For further information: Peter Winter, Editorial Director of Burrill
Life Science Media Group, +1-415-591-5474 , email@example.com Web Site: