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The Burrill Weekly Brief | January 30, 2012

What's Driving Roche's $5.7 Billion Bid for Illumina
Podcast: January 30, 2012

Roche’s $5.7 billion hostile bid for the sequencing company Illumina could create a personalized medicine powerhouse capable of not only driving a transformation in the treatment of disease, but its diagnosis as well. Roche has big visions, but the deal has raised some eyebrows. We spoke to Chris Bowe, U.S. Healthcare analyst for Scrip about Roche’s efforts, what it means for personalized medicine, and what some other M&A activity tells us about the industry's changing landscape.
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By The Numbers

Biggest movers for the week ending January 27, 2012
TICKER	COMPANY	CLOSING PRICE 1/20/2011	CLOSING PRICE 1/27//2011	PRICE CHANGE	PERCENT CHANGE
ADVANCERS
ENMD	EntreMed Inc.	1.59	2.6	1.01	63.5%
ILMN	Illumina Inc.	36.30	51.685	15.385	42.4%
MITI	Micromet, Inc.	8.20	10.9	2.7	32.9%
CPHD	Cepheid	32.56	43.14	10.58	32.5%
GEVO	Gevo, Inc.	6.65	8.64	1.99	29.9%
DECLINERS
CBRX	Columbia Laboratories Inc.	1.58	0.86	-0.72	-45.4%
INFI	Infinity Pharmaceuticals, Inc.	9.97	5.98	-3.99	-40.0%
ONCY	Oncolytics Biotech Inc.	4.47	3.55	-0.92	-20.6%
MNTA	Momenta Pharmaceuticals Inc.	18.91	15.19	-3.72	-19.7%
ACUR	Acura Pharmaceuticals Inc.	3.96	3.31	-0.66	-16.5%
Includes life sciences stocks with closing price of $1 or more on January 20, 2012

M&A activity boosts life sciences stocks
The Dow Jones Industrial Average Index slipped .5 percent this week, posting its first losing week of 2012. The Nasdaq Composite Index and the S&P 500 Index both finished the week higher, though just slightly. A flurry of M&A activity in the life sciences sector, led by Roche’s hostile takeover of Illumina for $5.7 billion, propelled biotechnology stocks higher this week. In notable economic news, the federal government reported that the U.S. economy grew at a slower pace than economists had expected in the fourth quarter.

Illumina was one of the biggest gainers of the week, seeing its shares jump 42.4 percent as Roche began its hostile takeover of the company for $5.7 billion. Columbia Laboratories’ shares fell the most this week, sinking 45.4 percent, after a U.S Food and Drug Administration advisory panel voted against approving the company’s progesterone gel to help prevent preterm pregnancy in women.

Hitting the Target
Preclinical biopharma Verastem raised $55 million in an initial public offering, the second life sciences IPO this year. But unlike many of the other drug developers that have gone public in the last couple of years, it garnered enough interest from investors to increase the size of its offering and price within its target range.
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Verastem goes public in an upsized IPO.

BURRILL INDICES	12/30/2011	1/20/2012	1/27/2012	Weekly Change	Year Change
Burrill Select	432.49	473.82	491.63	3.8%	13.7%
Burrill Large Cap	529.22	584.90	594.11	1.6%	10.5%
Burrill Mid-Cap	295.33	322.01	328.74	2.1%	9.0%
Burrill Small Cap	88.25	95.18	95.80	0.7%	7.9%
Burrill BioGreenTech	151	153.32	152.42	-0.6%	1.5%
Burrill Diagnostics	175.42	181.61	190.99	5.2%	3.5%
Burrill Personalized Medicine	100.62	105.95	111.50	5.2%	5.3%
Canadian Biotech	59.17	62.52	60.20	-3.7%	5.7%
NASDAQ	2605.15	2786.7	2816.55	1.1%	7.0%
DJIA	12217.56	12720.48	12660.46	-0.5%	4.1%
Amex Biotech	1090.18	1258.27	1297.05	3.1%	15.4%
Amex Pharmaceutical	332.94	335.37	332.67	-0.8%	0.7%

Big Biotech Fuels M&A Activity
Amgen and Celgene acquisitions add to growing list of biotech buys.
Big Biotech is muscling into an arena long dominated by Big Pharma, acquiring biotech companies to address pipeline issues or cement a leading position in a therapeutic area. It’s a growing trend as the differences continue to blur between Big Pharma and the handful of Big Biotechs. Read More Here

Strategic Outsourcing To Buoy European Drug Manufacturers
Shifting market dynamics will free, and then fill, capacity at facilities once kept busy by blockbusters, says consulting firm.
Growing use of European contract manufacturers by pharmaceutical and biotech companies seeking to cut costs could double the drug producers’ revenue by 2018, according to a new report. Read More Here

Gates Gives Global Fund $750 Million Boost
Philanthropist says tough economic times are no excuse for cutting aid to the world’s poorest.
The Global Fund to Fight AIDS, Tuberculosis and Malaria has received a major financial boost with a $750 million promissory note from the Bill and Melinda Gates Foundation. The promissory note, announced at the World Economic Forum in Davos, Switzerland, was hailed as an innovative funding mechanism. Read More Here

Kaiser Connects Patients on the Go
New website and free app put lab results, prescription refill requests on mobile phones.
Kaiser Permanente, one of the nation’s largest non-profit health plans, is launching a new version of its online medical records for patients tailored for mobile phones. Read More Here

Novo to Launch Type 1 Diabetes R&D Center
Danish diabetes care giant hopes to leverage basic research to speed drug development.
Novo Nordisk says it will establish a type 1 diabetes research and development center in Seattle to accelerate the development of new treatments for the disease, which has suffered from a lack of major scientific progress in recent years. Read More Here

The Physician Payment Sunshine Act: More Darkness Than Light
Desire to uncover conflicts of interest could backfire, sapping innovation.
The New Year brings in its wake the Physicians Sunshine Act and its requirement that pharmaceutical and device companies document all their payments to doctors, medical practices, and teaching hospitals so that, starting in 2013, these costs can be listed by the Center for Medicare and Medicaid Services on a public website. This action will result in unintended (but not unforeseeable) consequences on 21st century medical progress. Read More Here

Infinity Pharmaceuticals Tanks on Failed Cancer Drug Trial
The weekly round-up of failed trials, missed targets, and other business mishaps.
Infinity Pharmaceuticals lost 40 percent of its value after it voluntary stopped a mid-stage clinical trial of its investigational cancer therapeutic saridegib due to disappointing results. Preliminary analysis of interim data comparing saridegib in combination with gemcitabine to a placebo plus gemcitabine in 122 patients with previously untreated metastatic pancreatic cancer showed a difference in survival favoring the placebo plus gemcitabine arm. Read More Here

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