03 Oct Midwest large cap life science group strengthening in the third quarter
CHICAGO — The summer of 2005 has come and gone and we are enjoying the last throes of a late Indian summer. I just spent an incredible weekend enjoying this weather at a 35th high school class reunion in my hometown of Scarsdale (just outside of New York City). I was able to live out a longtime fantasy at this reunion (no, it’s not what you think!).
So, what is this fantasy? Well, in my senior year (1969-1970), we had this phenomenal rock and blues band in our class called the Brass Blues Band. This band was one of the few regional bands that featured a horn section (one of the horn players was an energetic, red-headed woman) with an incredible lead guitarist and harp player.
The harp player was as close to Paul Butterfield as it gets (both in looks and sound) and the band patterned itself after the Butterfield Blues Band (plus horns) with a few Stones songs thrown in (of course, it had to be the ones where a harmonica was featured, such as “Midnight Rambler”).
This was one awesome band, and while I wasn’t talented enough to play with them, I was able to book them gigs and provide them with sound engineering from my sound equipment. For this reunion, the band was pulled out of retirement (some of the band members continued on to become professional musicians while others became investment bankers). Other class musicians were also invited to jam.
The bottom line is that I got to play with them for about six songs (I even suggested two of the songs, which they accepted: Butterfield’s “Born in Chicago” and the “The Last Time” by the Stones.) I was in seventh heaven.
The amazing thing was that this group hadn’t played together in 35 years. They had gotten together for just one practice prior to the reunion and boy were they tight. After this, I was ready to sign autographs and look for the groupies. Alas, I landed back on Earth once again. In any event, this was a fantasy realized!
Enough of my musical experiences and onto the stock market and our Midwest life science results for the publicly traded companies. What transpired? While not pretty, the panorama for the first nine months of the year shows some improvement with the third quarter improving over the prior quarters.
If you recall the results from the first six months, it was pretty dismal for the major indices. The Dow Jones was down, the Nasdaq National Market was down, the Nasdaq Biotech index was down and the Amex Biotech index was up.
The results for the first nine months of 2005, though, showed legs and life. The biotech indices actually showed growth, which means that the actual results during the third quarter were strong.
Remember that the Amex Biotech index measures the very largest biotech companies, which are typically the best performers.
The Midwest large cap life science group continues to have a mixed performance for the year. However, the leaders outnumber the laggards and have actually strengthened their growth numbers.
Allscripts was our leader in the last quarter as it continues its dominance in the Midwest life science arena. Dade-Behring also continued its torrid growth pace. Who would have ever thought this was a company that was under reorganization just a few short years ago?
Since splitting off from parent Abbott Labs, Hospira also continues strong growth in its stock price. The stock price is on pace to almost double its initial listing price on the NYSE. American Pharmaceutical Partners has also been on a roll ever since new CEO Al Heller took charge and its new cancer drug Abraxane was approved by the FDA and has launched.
A number of companies continued to suffer during the year including Abbott and Eli Lilly. Abbott was set back by an FDA turndown of its new prostate cancer drug while Lilly was affected in part by the new FDA action to put a “black box” warning on a number of psychotropic drugs due to their potential for leading to teenage suicide. A Lilly drug was in this category.
Next week, we will take a look at the results from our Midwest biotech sector. See you next week!
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