3 Pharma Stocks Billionaire Izzy Englander Bought Recently

3 Pharma Stocks Billionaire Izzy Englander Bought Recently June 21, 2017
By Mark Terry, BioSpace.com Breaking News Staff

Billionaire investors probably know more than the day-to-day investors. Which is why Keith Speights, writing for The Motley Fool, is looking at three biopharma stocks that Israel “Izzy” Englander, co-founder of the $5 billion-plus Millennium Management hedge fund, recently bought.

1. Gilead Sciences

Analysts have been pushing Gilead to acquire something to bolster its sagging hepatitis C franchise for quite some time. Even so, the company is one of the most profitable big pharma companies with a net margin of 43.4 percent. Over the last 12 months, the company reported $29.1 billion in revenue with earnings of $12.6 billion.

In the first quarter of 2017, Millennium acquired another 480,000 shares of Gilead, which gives it a stake in the company of almost $129 million. It also acquired 200,000 call options.

Speights thinks there are three things about Gilead that appeal to Englander. First is the company’s pipeline, which is particularly strong in the HIV/AIDS area. “Second,” writes Speights, “I suspect Englander thinks that Gilead’s valuation won’t go much, if any, lower than it already is. The stock has fallen more than 20 percent in the last 12 months, with shares now trading at less than nine times expected earnings.” And finally, of course, he probably thinks Gilead will buy something big, sooner rather than later.

Gilead is currently trading for $66.91.

2. Synergy Pharmaceuticals

Based in New York City, Synergy reported in early December 2016, that one of its two pivotal Phase III clinical trials of Trulance (plecanatide) for irritable bowel syndrome with constipation (IBS-C), had positive top-line results. In March 2017, the company launched Trulance for chronic idiopathic constipation.

At the end of last year, Millennium held almost 1.9 million shares of Synergy stock. In the first quarter, it bought another 1.39 million shares. Speights writes, “Weekly prescription volume for Trulance in treating chronic idiopathic constipation (CIC) is steadily growing after Synergy launched the drug in March 2017. The company recently stated that over 60 percent of patients with commercial insurance now have unrestricted access to Trulance.”

In addition, at the beginning of 2018, the U.S. Food and Drug Administration (FDA) is expected to decide on the drug for irritable bowel syndrome with constipation.

Synergy is currently trading for $4.49.

3. Valeant Pharmaceuticals

Probably most readers—and investors—didn’t see this one coming. Valeant has been in trouble for some time, deeply in debt, under investigation by the U.S. Securities and Exchange Commission for a variety of alleged violations ranging from insider trading to price gouging. But it’s possible that Englander thinks the company’s new chief executive officer, Joe Papa, can turn the company around.

So far it seems like he can. Papa has cut the company debt and sold off several non-core assets, most recently iNova Pharmaceuticals for $930 million in cash.

Speights writes, “Surprisingly, Valeant stock has turned in a better performance than either Gilead Sciences or Synergy so far in 2017. That’s not all that great, since Valeant’s share price is still below where it started the year. However, the company’s asset sales have helped prop up the stock to some extent. Whether or not Englander’s bet pays off, though, will probably depend more on how Valeant’s new products like psoriasis drug Siliq perform.”

Valeant is currently trading for $13.84.

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