|August 8, 2014|
|07:01 EDT||COV, MYL, AGN, MDT, VRX, ABT||Harvard professor says Treasury can reduce inversion incentives, NY Times says|
Stephen Shay, a Harvard Law School professor and former deputy assistant secretary for international tax affairs at the Treasury Department, recently argued in the trade journal Tax Notes that the Treasury Department could reduce the incentives for tax inversions, according to a New York Times columnist. Treasury can do this by limiting the deductions for interest payments that an American subsidiary pays its foreign parent company, and by ensuring that profits of overseas subsidiaries will continue to be subject to American taxes, the columnist quoted Shay as saying. Robert Willens, described as an influential tax commentator by the columnist, indicated that Shay's suggestions aren't practical, but the columnist says they are both legally and politically feasible. Among the deals or possible transactions that involve inversion are Mylan's (MYL) acquisition of Abbott (ABT), Medtronic's (MDT) acquisition of Covidien (COV) and Valeant's (VRX) proposed takeover of Allergan (AGN). Reference Link
News For MYL;ABT;MDT;COV;VRX;AGN From The Last 14 Days
|February 4, 2016|
|09:09 EDT||VRX||Valeant volatility up into House Oversight & Government Reform Committee hearing|
Valeant January weekly call option implied volatility is at 85, February is at 71, March is at 78; compared to its 52-week range of 26 to 116, suggesting large near term price movement into House Oversight & Government Reform Committee holding a hearing to discuss methods and reasoning behind recent drug price increases with Interim CEO Hoard Schiller.
|08:48 EDT||VRX||House Oversight & Government Reform Committee to hold a hearing|
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|February 3, 2016|
|06:13 EDT||MYL, AGN||Pfizer insists Allergan deal won't be thwarted by U.S. politicians, FT says|
Pfizer (PFE) has insisted that its $160B acquisition of Allergan (AGN) will not be stifled by political opposition, amid criticism that the deal will cost the U.S. Treasury billions of dollars in future tax revenues, the Financial Times reports. Pfizer CEO Ian Read also reiterated his intention to postpone until 2018 a decision on whether to break of the combined entity into two or three smaller companies, but has said that he would be open to offers for its generics unit, the report says. Mylan (MYL) has been connected to a potential acquisition of Pfizer's generic drugs business after it failed in its attempt to buy Perrigo (PRGO) last year, the report says. Reference Link
|February 2, 2016|
|12:32 EDT||VRX||Evercore highlights potential discrepancy in Valeant documents|
Evercore ISI analyst Umer Raffat says the Valeant documents released ahead of Thursday's Congressional hearing on drug pricing contain a potential discrepancy between CEO Mike Pearson's comments on a conference call and an internal email sent by then CFO Howard Schiller. On the company's Q1 earnings call last year, Pearson told investors and analysts that volume was greater than price in terms of the company's growth in the quarter, Raffat points out to investors in an intraday research note. In contrast, then-CFO Howard Schiller sent an email to Pearson a few weeks after the earnings call stating that excluding the Marathon deal, price represented about 60% of Valeant's quarterly growth. On the surface, this means that either the CEO was inaccurate on the Q1 call, or the CFO's email was inaccurate, Raffat writes. It could also mean neither had done the math properly, the analyst adds. Either way, Raffat thinks Thursday's hearing isn't too critical for shares of Valeant. He has a Buy rating on the stock with a $200 price target. Valeant is down 5%, or $4.61, to $91.04 in midday trading.
|11:30 EDT||VRX||Valeant, in response to House committee, says tries to set appropriate prices|
Valeant issued a statement after the House's Committee On Overweight and Government Reform released a letter relating to documents obtained from the company. The statement read, "Before Valeant purchased Nitropress and Isuprel, it commissioned outside consultants to review the drugs' pricing. Those consultants concluded that, given the significant reimbursements hospitals received under bundled rates for procedures, the prices of both drugs did not reflect their true value to hospitals and patients. We try to set our prices at the appropriate levels, but we also listen to the market. In this case, we've heard from hospitals, as well as from Congress, that we set the price for these two drugs too high, and we've responded by offering volume-based discounts of up to 30% for each of them. We are also making overall changes to how we run our business. Under our recent partnership with Walgreens we will be offering 10% price reductions on some of our most popular drugs and up to 95% reductions for a large number of our branded drugs for which there is a generic alternative. Going forward, we expect our growth to be driven more by volume than by price. When we set the price of any one drug, we do it in the overall context of our portfolio of approximately 1,800 products, including more than 200 prescription drugs in the United States, and the need to fund our robust companywide research and development programs, our expanding U.S. manufacturing base, and our patient assistance programs. In 2016, we expect to invest approximately $400 million on R&D, $484 million in expanding manufacturing in Rochester, NY, and $1 billion in our patient assistance programs that seek to ensure that out-of-pocket expenses do no prevent eligible patients from receiving medicines they need."
|11:30 EDT||VRX||House committee members says Valeant inflated drug prices to meet goals|
In a memo from the Committee on Oversight and Government Reform, Democratic members of the committee stated that documents obtained from Valeant show that the company identified goals for revenue first, then "set drug prices to reach those goals," pointing to its sharp price increases for Isuprel and Nitropress as examples of this practice. The committee also contend that Valeant employed a public relations strategy, which is noted to be used by other drug companies as well, to "distract public attention away from its price increases." Valeant raised the prices of some products multiple times from 2014 to 2015, in some cases by as much as 800%, the committee members stated. Reference Link
|10:59 EDT||AGN||Pfizer CEO confident Allergan deal can close in second half|
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|07:22 EDT||ABT||Alere downgraded to Hold from Buy at Canaccord|
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|06:54 EDT||AGN||Pfizer expects combination with Allergan to occur in 2H16|
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|06:05 EDT||ABT||Alere downgraded to Hold from Buy at Jefferies|
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|February 1, 2016|
|16:21 EDT||ABT||On The Fly: Top stock stories for Monday|
Stocks began the session deep in negative territory, beginning February the way they spent most of January, weighed down by the price of oil, which fell about 6% for the session. Also hitting the market early were weak economic reports, both in China and the U.S. The averages moved higher late in the day as investors awaited the next barrage of earnings reports, which will include results from Google parent Alphabet (GOOG). ECONOMIC EVENTS: In the U.S., personal income rose 0.3% in December, versus expectations for an increase of 0.2%, while spending was flat, versus expectations for an increase of 0.1%. Markit's manufacturing purchasing managers index for January dipped to 52.4 in the final January reading, down from the 52.7 flash reading and below the 52.6 reading that was expected. The Institute for Supply Management's manufacturing index for January came in at 48.2, below the 48.4 that analysts expected. Construction spending rose 0.1% in December, which was weaker than the 0.6% increase that was forecast. Separately, Federal Reserve Vice Chairman Stanley Fischer spoke about recent monetary policy decisions undertaken by the Fed, reiterating expectations that "economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate," while also revealing that four rate hikes is among the numbers being discussed by the Federal Reserve for this year. In China, the government's official manufacturing purchasing managers index fell to 49.4 in January from 49.7 in December. The private Caixin manufacturing PMI edged up to 48.4 from 48.2 in the prior reading, but both figures still remain in contraction territory. In Europe, Markit's manufacturing PMI for the euro zone dropped to 52.3 from December's 53.2, in-line with the earlier flash estimate. COMPANY NEWS: After swinging as high as $18.77, shares of Twitter (TWTR) ended the day up 6.55% at $17.90 after tech reporter Jessica Lessin said private equity firm Silver Lake and investor Marc Andreessen have "considered some sort of deal" for the microblog service operator, though Lessin noted she didn't know if deal talks are currently active. Later in the day, a source familiar with the matter told Fortune that Silver Lake has no interest in acquiring "even a slice" of Twitter... Alere (ALR) surged 45.5% to $54.11 after Abbott (ABT) agreed to acquire the company for $56 per share at a total expected equity value of $5.8B. In other M&A news, Questar (STR) jumped 22.5% to $24.99 after Dominion Resources (D) agreed to acquire it for $25 per share, or about $4.4B. Dominion slipped 2.76% after announcing the deal and reporting its latest quarterly results... Chipotle (CMG) rose 4.3% to $472.64 after the Centers for Disease Control and Prevention released its final update on the company's E. coli scare, saying the two outbreaks "appear to be over." MAJOR MOVERS: Among the notable gainers were Sysco (SYY) and Aetna (AET), which advanced 8.4% and 1.4%, respectively, after reporting quarterly earnings. Also higher was Barracuda Networks (CUDA), which jumped about 11% to $11.75 after Bloomberg reported the company is exploring a sale. In addition, Time Warner (TWX) gained 2.7% after the New York Post reported over the weekend that billionaire investor Nelson Peltz is considering taking an activist position in the company. Among the noteworthy losers was GoPro (GPRO), which declined 3.4% to $11.06 after analysts from Piper Jaffray and Citi predicted that the company's guidance this week will disappoint investors. Also lower was DreamWorks (DWA), which fell 6.8% to $23.90 after the studio's new film "Kung Fu Panda 3" missed expectations for its domestic box office opening. Meanwhile, Roper Technologies (ROP) and Cardinal Health (CAH) lost a respective 6.8% and 1.9% after reporting quarterly earnings. INDEXES: The Dow slipped 17.12, or 0.1%, to 16,449.18, the Nasdaq gained 6.41, or 0.14%, to 4,620.37, and the S&P 500 fell 0.86, or 0.04%, to 1,939.38.
|13:25 EDT||AGN||Earnings Watch: Pfizer shares down approximately 12% since last earnings report|
Pfizer (PFE) is scheduled to report fourth quarter earnings before the market open on Tuesday, February 2, with a conference call scheduled for 10:00 am ET. Pfizer, a biopharmaceutical company, discovers, develops, manufactures, and sells healthcare products worldwide. Its product portfolio includes medicines and vaccines, as well as various consumer healthcare products. EXPECTATIONS: Analysts are looking for earnings per share of 52c on revenue of $13.57B, according to First Call. The consensus range for EPS is 49c-54c on revenue of $13.08B-$13.99B. LAST QUARTER: After completing its Hospira acquisition in early September, Pfizer reported third quarter EPS of 60c, which beat consensus estimates of 51c, on revenue of $12.1B, which was also higher than consensus estimates of $11.56B. In Q3 Operational revenue growth in in developed markets was driven primarily by the performance of several key products, including Prevnar 13 in adults, Ibrance and Eliquis -- all products that are early in their life cycles as well as from Lyrica primarily in the U.S., and the inclusion of one month of legacy Hospira U.S. operations. In emerging markets, revenues increased 5% operationally, reflecting continued strong operational growth, primarily from the Innovative Products business. Operational revenue growth was partially offset primarily by the loss of exclusivity and associated generic competition for Celebrex in the U.S., Zyvox in the U.S. and Lyrica in certain developed Europe markets. With its Q3 earnings announcement the company raised its fiscal year 2015 earnings per share view to $2.16-$2.20 from $2.04-$2.10 against a raised revenue view of $47.5B-$48.5B from $46.5B-$47.5B. Commenting on the improved yearly view, the company CFO said "We raised our 2015 financial guidance for reported revenues and adjusted diluted EPS to reflect the strong performance to date of Pfizer-standalone, excluding legacy Hospira operations coupled with an improved business outlook for Pfizer-standalone for the remainder of the year.PFIZER-ALLERGAN DEAL. On November 23, Pfizer and Allergan (AGN) announced that their boards of directors have unanimously approved, and the companies have entered into, a definitive merger agreement under which Pfizer will combine with Allergan. Pfizer at the time said it anticipates the Allergan transaction will deliver more than $2B in operational synergies over the first three years after closing. Pfizer anticipates that the combined company will have a pro forma Adjusted Effective Tax Rate of approximately 17%-18% by the first full year after the closing of the transaction. The transaction is expected to be neutral to Pfizer's Adjusted Diluted EPS in 2017, modestly accretive beginning in calendar year 2018, more than 10% accretive in 2019 with high-teens percentage accretion in 2020. STREET RESEARCH: On December 1, Barclays analyst Geoff Meacham kept an Equal Weight rating on Pfizer after assuming coverage of the name. The analyst maintained a $34 price target for shares.On November 25, SunTrust upgraded Pfizer to Neutral and increased its price target to $37 from $34 on shares. Analyst John Boris said the Allergan deal makes strategic sense, providing much needed growth from earlier life cycle assets with limited therapeutic overlap. PRICE ACTION: Shares of Pfizer are lower by approximately 12% since its last earnings report on October 27. Pfizer shares are trading over 1% lower to $29.97 in afternoon trading ahead of Tuesday morning's earnings.
|12:13 EDT||ABT||On The Fly: Top stock stories at midday|
Stocks on Wall Street were lower at midday, but off their worst levels of the day, as oil is once again being weighed on by worries of slower growth in China. Several M&A announcements helped fuel speculation that deal-making may be set to pick up, but the headwinds of lower oil prices and weak economic data are outweighing that potential boost and keeping stocks in the red to start the month. ECONOMIC EVENTS: In the U.S., personal income rose 0.3% in December, versus expectations for an increase of 0.2%, while spending was flat, versus expectations for an increase of 0.1%. Markit's manufacturing purchasing managers index for January dipped to 52.4 in the final January reading, down from the 52.7 flash reading and the below the 52.6 reading that was expected. The Institute for Supply Management's manufacturing index for January came in at 48.2, below the 48.4 that analysts expected. Construction spending rose 0.1% in December, which was weaker than the 0.6% increase that was forecast. In China, the statistics bureau's official manufacturing purchasing managers index fell to 49.4 in January from 49.7 in December. The private Caixin manufacturing PMI edged up to 48.4 from 48.2 in the prior reading, but both figures still remain in contraction territory. In Europe, Markit's manufacturing PMI for the euro zone dropped to 52.3 from December's 53.2, in-line with the earlier flash estimate. COMPANY NEWS: Shares of Twitter (TWTR) advanced 9% after tech reporter Jessica Lessin said private equity firm Silver Lake and investor Marc Andreessen have "considered some sort of deal" for the microblog service operator. Lessin noted in the report published on her site, The Information, that she did not know if deal talks are "active" now between Andreessen, Silver Lake and Twitter... Alere (ALR) surged 45% to $54 per share near midday after Abbott (ABT) agreed to acquire the company for $56 per share at a total expected equity value of $5.8B. In other Monday M&A news, Questar (STR) rose 22% after Dominion Resources (D) agreed to acquire it for $25 per share, or about $4.4B, and assume Questar's outstanding debt. Meanwhile, Stryker (SYK) announced a deal to acquire Sage Products for $2.775B in cash. The buyers' shares did not fare as well in the wake of the deal announcements, as Abbott slipped 0.5%, Dominion dipped 1% and Stryker fell 1%. Also lower were shares of Smith & Nephew (SNN), which slid fractionally as investors may have been concerned that Stryker's deal decreases the likelihood that it will come after S&N. Additionally, Smith & Nephew announced that its CEO Olivier Bohuon has been diagnosed with a "highly treatable" form of cancer. MAJOR MOVERS: Among the notable gainers was Lumber Liquidators (LL), which gained 8.5% after a judge accepted the company's $10M plea deal to settle timber source crime charges, according to media reports. Also higher was Chipotle (CMG), which rose 5.5% after The Wall Street Journal reported that the Centers for Disease Control and Prevention is expected to formally declare the end to its E.coli outbreak as soon as today. In addition, Sysco (SYY) and Aetna (AET) were up 7% and 2%, respectively, after reporting quarterly earnings. Among the noteworthy losers was Nokia (NOK), which fell 12% after it forecasted how much revenue it expects to gain from its IP portfolio after its patent deal with Samsung (SSNLF) and its shares were downgraded at Canaccord and BofA Merrill Lynch. Also lower was GoPro (GPRO), which was slid 5% after analysts from Piper Jaffray and Citi predicted that the company's guidance to be issued this week will disappoint investors. In addition, Roper Technologies (ROP) and ImmunoGen (IMGN) were down 6.5% and 5.7%, respectively, after reporting quarterly earnings. INDEXES: Near midday, the Dow was down 56.40, or 0.34%, to 16,409.90, the Nasdaq was down 12.25, or 0.27%, to 4,601.70, and the S&P 500 was down 6.51, or 0.34%, to 1,933.73.
|10:02 EDT||MDT||Medtronic announced CE Mark, commercial launch for Resolute Onyx expansion|
Medtronic announced the recent CE Mark and commercial launch for an expanded size matrix of the Resolute Onyx DES, a next generation drug-eluting stent that is now available in 4.5mm and 5.0mm diameter sizes. The CE Mark also approved several new product indications including treatment of left main vessels and small vessels. Many coronary vessels are large in diameter of which a sub-set are left main, and now physicians can treat these large vessels with optimally sized stents that provide appropriate drug concentration. Resolute Onyx is the first DES available in these sizes among major manufacturers, offering the broadest size matrix to optimize the treatment of complex clinical scenarios. The Resolute Onyx DES is not commercially available in the United States.
|09:27 EDT||ABT||On The Fly: Pre-market Movers |
HIGHER: Alere (ALR), up 45.4% after announcing that Abbott (ABT) will acquire the company for $56 per share... Questar (STR), up 20.2% after announcing that Dominion (D) will acquire the company for $25 per share and assumed debt... Mast Therapeutics (MSTX), up 12.2% after the Phase 2a study of AIR001 met its primary endpoint... Twitter (TWTR), up 5.7% after The Information reported that Marc Andreessen and Silver Lake have considered a deal for Twitter... Herbalife (HLF), up 2.2% after the Wall Street Journal reported that probes into Bill Ackman's "pyramid scheme" accusations against Herbalife, as well as Herbalife's own accusations that Ackman sought to manipulate the company's stock, have both failed to uncover enough evidence to support criminal charges. LOWER: Dominion Resources, down 1.7% after reporting quarterly results and that it will acquire Questar... Abbott, down 4.1% after announcing that it will acquire Alere... GoPro (GPRO), down 4.4% after Piper Jaffray cut its price target to $7.50.
|08:09 EDT||ABT||Options expected to be active|
Options expected to be active: GOOGL GOOG YHOO UPS KORS UPS BAX RCL CCL PFE AET D STR DWA CMG ABT SYK.
|08:05 EDT||ABT||Abbott to acquire Alere for $56 per share|
Abbott (ABT) and Alere (ALR) announced a definitive agreement for Abbott to acquire Alere. Under the terms of the agreement, Abbott will pay $56 per common share at a total expected equity value of $5.8B. Once the transaction is completed, Abbott will become the leading diagnostics provider of point of care testing, the company said. Abbott's total diagnostics sales will exceed $7B after the close. The transaction will be immediately accretive to Abbott's ongoing earnings per share upon close and significantly accretive thereafter, with approximately 12c-13c of accretion in 2017 and more than 20c in 2018. The combination is anticipated to result in annual pre-tax synergies approaching $500M by 2019 and increasing thereafter, including both sales and operational benefits. Under the terms of the agreement, Alere shareholders will receive $56 per common share in cash at the completion of the transaction, and Alere will become a subsidiary of Abbott. Alere's net debt, currently $2.6B, will be assumed or refinanced by Abbott. The transaction, which has been approved by the boards of directors of Alere and Abbott, is subject to the approval of Alere shareholders and the satisfaction of customary closing conditions, including applicable regulatory approvals.
|08:05 EDT||MDT||Medtronic acquires Bellco|
Medtronic announced it acquired privately-held Bellco, a pioneer in hemodialysis treatment solutions. Bellco's portfolio bolsters Medtronic's legacy renal access business and will be a foundational component of the company's recently formed Renal Care Solutions business. The Bellco transaction is expected to meet Medtronic's long-term financial metrics for acquisitions. Medtronic expects the net impact from the transaction to be earnings neutral in FY16 and neutral to accretive to earnings thereafter.
|08:04 EDT||MYL||Teva Mylan not seeing same negative trends as Sandoz, says Bernstein|
After Novartis (NVS) reported weak results for its generics unit, Sandoz, and blamed it on industry trends, Bernstein quotes Mylan (MYL) and Teva (TEVA) as saying that they are seeing only "slight adjustments back to normal levels" from "mildly favorable" results in 2014 and 2015. Bernstein says that Sandoz has lost a number of fairly profitable products and has had fewer approvals than its peers. Bernstein keeps Outperform ratings on Teva and Mylan.
|08:02 EDT||ABT||Abbott to acquire Alere for $56 per share|
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