Predix Pharmaceuticals, which recently announced a definitive agreement to merge with EPIX, announces that it has entered into an exclusive collaboration and licensing agreement with Amgen (AMGN) for the development of novel, orally available S1P1 modulators for the treatment of multiple autoimmune diseases. Under the terms of the agreement, Predix and AMGN will collaborate on the development of existing Predix preclinical compounds and new S1P1 modulators. AMGN will be responsible for clinical development and commercialization of the product candidate. Predix will receive an upfront payment of $20 mln. Additionally, if certain clinical, regulatory and sales milestones are achieved, Predix can earn up to an additional $287.5 mln in milestone payments


XOMA Limited awarded new $16 mln BioDefense contract with NIAID Co announces it has been awarded an exclusive $16 million contract from the National Institute of Allergy and Infectious Diseases, a part of the National Institutes of Health, to produce monoclonal antibodies for the treatment of botulism to protect U.S. citizens against the harmful effects of botulinum neurotoxins used in bioterrorism. Under the new three-year contract, XOMA will create and produce an innovative injectable product comprised of three anti-type A-botulinum neurotoxin monoclonal antibodies to support entry into Phase I safety human clinical trials.

Pain drug developer Pozen (POZN) moved almost 22% higher following an announcement that the company submitted additional data on its experimental migraine drug Trexima to regulators.

Pozen and its Big Pharma partner GlaxoSmithKline (GSK) met with the Food and Drug Administration, which previously said the drug was approvable pending additional safety data, and have announced plans to submit a full response to the agency during the fourth quarter. The FDA will have six months to review the response. Shares of Pozen were up $1.31 to $7.38.

EPIX Pharmaceuticals (EPIX) rose 10.8% to $4.74 following an announcement that Predix Pharmaceuticals, a company it's acquiring, signed an exclusive collaboration and licensing agreement with biotech giant Amgen (AMGN) to develop drugs for autoimmune diseases.

Amgen will develop and market the drugs, and Predix will receive an upfront payment of $20 million. If certain milestones are met, Predix may receive up to $287.5 million in additional payments. Predix could also receive significant royalties on future sales of the drugs and have the option to promote a product resulting from the collaboration.

YM BioSciences (YMI) gained 8.7% to $3.37 after the company said its CIMYM BioSciences unit licensed the development and marketing rights in Japan for its head and neck cancer treatment nimotuzumab to Daiichi Pharmaceutical, a subsidiary of Daiichi Sankyo.

CIMYM will receive an initial payment of $14.5 million, plus milestone payments based on the supply of the drug and its sales performance. Nimotuzumab is already approved in India as a treatment for head and neck cancer, but Daiichi plans to develop the drug for the Japanese market for several other types of cancer as well.

Shares of ImClone Systems (IMCL) fell after a federal court denied its request to dismiss a patent infringement lawsuit brought by Repligen (RGEN) and the Massachusetts Institute of Technology regarding the production of the cancer drug Erbitux. The stock fell 3.8% to $32.64. ImClone maintains that it doesn't infringe the patent. The case will now proceed to trial.

Boston Scientific (BSX) and St. Jude Medical (STJ) fell after the medical-device makers settled four patent lawsuits.

The companies also entered an agreement to cross-license certain cardiac-rhythm management patents to help avoid future disputes. The sides plan to limit the amount of information they disclose regarding two other lawsuits, which are unresolved. Boston Scientific fell 2.2% to $17.12, and St. Jude lost 1.3% to $36.93.

Other health stocks on the decline included Gilead Sciences (GILD) , down 2.2% to $61.13, IDM Pharma (IDMI) , whose shares sank 8.3% to $2.55, Lipid Sciences (LIPD) , off 6.5% to $1.30, Pharmos (PARS) , 8.9% lower to $1.85, Immunicon (IMMC) down 6% to $4.05, and Inovio Biomedical (INO) , trading 3.2% lower at $2.07.

Stocks moving higher included XTL Biopharmaceuticals (XTLB) , up 14.2% to $3.53, Hollis-Eden Pharmaceuticals (HEPH) , whose shares jumped 18.3% to $6.15, OraLabs Holding (OLAB) , trading 7.7% higher at $3.50, Regenerx Biopharmaceuticals (RGN) , up 8.4% to $1.94, and PainCare Holdings (PRZ) , adding 5.7% to $1.87.

Drugmaker Pozen Inc. (POZN) on Monday said it will respond fully to U.S. regulators in the fourth quarter to address concerns raised about the safety of an experimental migraine drug it is developing with GlaxoSmithKline Plc (GSK), sending shares up 22 percent.

Analysts read Pozen's response to the U.S. Food and Drug Administration's so-called approvable letter announced on June 9 as a sign that the safety concerns could be easily addressed. Pozen's shares jumped $1.33 to $7.40 on the Nasdaq, where it was among the top percentage gainers.

The agency last month said it would not approve the drug Trexima until new safety information was available, sending shares down some 50 percent.

Pozen made the announcement after it and partner Glaxo met with the FDA.

"The fairly quick turnaround on the submission suggests no new clinical studies are necessary, and Pozen likely has the requisite safety data already in it possession," said Wachovia analyst Michael Tong, in a note to clients.

Trexima combines Imitrex with the painkiller naproxen, an older non-steroidal, anti-inflammatory drug or NSAID.

Imitrex is part of a class of drugs known as triptans used to stop but not prevent migraines. The drugs aim to relieve pain by allowing better blood flow. Adding naproxen helps extend the relief, Pozen has said.

Tong said he expects the product could be launched as early as the second half of 2007.

Intuitive Surgical Inc shares bounced back on Friday up 1.27 (1.27%) to $100.57 in trading on the Nasdaq.

ISRG slid Thursday, after the medical-equipment manufacturer reported a strong second quarter but failed to provide the "blowout" results some in the market expected.

Stock of the Sunnyvale, Calif.-based company fell $12.14, or 11 percent, to close at $99.30 on the Nasdaq Stock Market.

Thursday's weakest level, on heavy volume, was $97.13. On a 52-week basis, there was a low of $61.50 last July 27 and a high of $139.50 on Jan. 30.

Intuitive Thursday said second-quarter earnings rose to $16.7 million, or 44 cents a share, from $14.8 million, or 40 cents a share, a year earlier.

Excluding stock compensation expenses, earnings came in at 55 cents a share.

Analysts surveyed by Thomson Financial had forecast, on average, earnings of 40 cents a share. Such estimates typically exclude items.

"Some elements of the investor base were looking for a blowout quarter; it was a good quarter, not a blowout quarter," Oppenheimer & Co. analyst Timothy B. Nelson said.

Analysts said the sell-off was overdone, but came probably because the number of robotic da Vinci surgical systems it shipped during the quarter _ 39 _ was below what some expected.

Analysts were upbeat on the company's outlook, however, saying the increasing use of the company's machines by gynecologists in hysterectomies bodes well, and noting the company's updated 2006 revenue guidance.

The company said it expects total 2006 revenue to grow between 50 percent and 55 percent over 2005, with each revenue segment expected to grow more than previously forecast.

Intuitive Surgical had previously indicated it expected 2006 annual revenue to grow between 45 percent and 50 percent over 2005.

"Da Vinci has become an important marketing tool for hospitals in maintaining and gaining market share, and as such having the most cutting edge technology is viewed as very important by hospital administrators," Deutsche Bank analyst Tao Levy wrote in a research report. Deutsche Bank makes a market in the securities of Intuitive.

Enzon Pharmaceuticals, Inc. (Nasdaq ENZN) and Santaris Pharma A/S (private) announced today that the companies have entered into a collaboration to co-develop and commercialize a series of innovative RNA Antagonists based on Santaris Pharma's LNA® (locked nucleic acid) technology and utilizing Enzon's oncology drug development expertise.

Under the terms of the agreement, Enzon is licensing two of Santaris Pharma's preclinical development compounds, the HIF-1 alpha antagonist (SPC2968) and the Survivin antagonist (SPC3042), and six additional proprietary RNA Antagonist candidates, all to be directed against novel oncology drug targets selected by Enzon. Enzon will have exclusive rights to develop and commercialize these compounds in the U.S. and other non-European territories. Santaris will retain exclusive rights to commercialization in Europe. The companies will share development data for use in their respective territories. Further, Enzon will have the opportunity to explore the potential for added benefit with its next-generation PEGylation Customized Linker Technology(TM).

Enzon will make an initial up-front payment of $8 million to Santaris Pharma, followed by an additional $3 million upon the successful identification of certain LNA targets and additional payments on the achievement of pre-specified discovery, development and regulatory milestones, representing a potential aggregate total of more than $200 million. Enzon will pay royalties to Santaris Pharma on net sales of RNA Antagonist products resulting from the collaboration in non-European territories.

"This very important collaboration is in line with our strategic goal of advancing our presence in oncology while leveraging our access to proprietary new technologies" said Jeffrey H. Buchalter, Enzon's chairman and chief executive officer. "This partnership will greatly enhance our R&D pipeline with the addition of two new clinical programs in the next six-to-12 months and another six preclinical compounds entering the pipeline over the next few years."

"We are delighted to be in partnership with Enzon Pharmaceuticals, whose new management has extensive experience of developing and commercializing innovative oncology drugs, making them an ideal partner for Santaris," said Keith McCullagh, president and chief executive officer, Santaris Pharma A/S. "Together we are committed to building a unique portfolio of RNA Antagonist drugs with the potential to address some of the underlying genetic causes of disease and improve patient outcomes in the treatment of cancer."

About LNA® Technology

LNA Technology, developed by Santaris Pharma, is based on Locked Nucleic Acid, a proprietary synthetic analog of ribonucleic acid (RNA) which is fixed in the shape adopted by RNA in helical conformation. When incorporated into a short nucleic acid chain (both DNA and RNA are made up of longer chains of natural nucleic acids), the presence of LNA results in several therapeutic advantages. Because LNA resembles RNA but is more stable, LNA-containing drugs have both very high binding affinity for RNA and metabolic stability. Using the "antisense" principle to block the function of specific RNAs within cells and tissues, such drugs have enhanced potency and specificity and may provide improved efficacy at lower doses than comparable drugs based on alternative chemistry. As a result, RNA Antagonists comprised of LNA have been demonstrated to be 100 to 1,000 times more potent in vitro than conventional antisense compounds and also to demonstrate more efficacy in vivo than the best siRNA's (small interfering RNAs) published to date. In particular, they can be used to switch off the synthesis of harmful proteins, thereby potentially altering disease outcomes in cancer or other serious disorders.

About PEGylation (PEG) Technology

Enzon's proprietary PEG (polyethylene glycol) technology can be applied to a number of different types of molecules including proteins, peptides, antibodies, and oligonucleotides. Many of these compounds possess pharmacologic limitations, such as toxicity, poor solubility, and limited half-life. Through the chemical attachment of PEG, these limitations can potentially be overcome and a compound generated with substantially enhanced therapeutic value. Specific advantages of PEG can include increased efficacy, reduced dosing frequency, reduced toxicity, increased drug stability, and enhanced drug solubility. Enzon's PEG expertise includes linker chemistries that are designed to incorporate a stable chemical bond between the native molecule and the PEG, as well as a Customized Linker Technology(TM), which is a next-generation platform that utilizes releasable linkers designed to release the native molecule at a controlled rate.

About Enzon Pharmaceuticals

Enzon Pharmaceuticals, Inc. is a biopharmaceutical company dedicated to the development and commercialization of therapeutics to treat patients with cancer and adjacent diseases. Enzon's specialized sales force markets Abelcet®, Oncaspar®, Adagen®, and Depocyt® in the United States. In addition, Enzon also receives royalties on sales of PEG-INTRON®, marketed by Schering-Plough Corporation, and MACUGEN®, marketed by OSI Pharmaceuticals and Pfizer Inc. Enzon's product-driven strategy includes an extensive drug development program that leverages its proprietary technologies, including a Customized Linker Technology(TM) PEGylation platform that utilizes customized linkers designed to release compounds at a controlled rate. Enzon also utilizes contract manufacturing opportunities to broaden its revenue base and enhance its organizational productivity. Enzon complements its internal research and development efforts with strategic initiatives, such as partnerships designed to broaden its revenue base or provide access to promising new technologies or product development opportunities.




Celgene (CELG) sank following its report that its quarterly earnings fell and revenue was lower than expected. Celgene earned $9.6 million, or 3 cents a share, compared with $10.8 million, or 5 cents a share, a year ago. Excluding certain charges, the company earned 11 cents a share, a penny above analysts' estimates.

While Celgene reported record revenue of $197.2 million in the second quarter, with $63 million in sales of its multiple myeloma drug Revlimid and $107.2 million in sales of the older generation blood-cancer drug Thalomid, it fell short of the $199.2 million analysts were expecting. Shares sank 5.4% to $46.25.


CuraGen (CRGN) , a biopharmaceutical developer, reported a narrower quarterly loss and revised its full-year guidance, sending its shares 1.3% higher to $3.13. CuraGen lost $14.3 million, or 26 cents a share vs. a loss of $15.7 million, or 31 cents a share, in the year-ago quarter.

For 2006, CuraGen narrowed its loss expectations by $5 million from its previous guidance to between $65 millioni and $70 million. The Branford, Conn., company also reiterated its revenue guidance of between $35 million and $38 million.


Millennium Pharmaceuticals (MLNM) , maker of the cancer drug Velcade, fell despite a narrower loss in the second quarter and better-than-expected sales. The stock was down 2.2% to $9.52.

The company lost $17.7 million in the quarter vs. a $44.1 million loss in the second quarter a year ago. Revenue was $120.1 million, compared with $110.6 million last year. Velcade sales rose 34% to $58.8 million. Analysts were expecting overall revenue of $115.8 million. Excluding certain charges, the company reported a penny per share in earnings, compared with loss of 2 cents a share expected by analysts surveyed by Thomson First Call. Millennium also reiterated its full-year guidance for a loss of between $95 million and $115 million.


Among other stocks on the move, Genentech (DNA) shares fell 1.6% to $81.07, SuperGen (SUPG) was down 2.7% to $3.55, and InterMune (ITMN) lost 3.8% to $15.37. United American Healthcare (UAHC) was down 7.3% to $3.20.

Stocks getting a boost included Ivax Diagnostics (IVD) , up 14.8% to $1.55, Iomed (IOX) , gaining 5.7% to $1.85, Chad Therapeutics (CTU) , higher by 5.1% to $2.69 and PainCare Holdings (PRX) , up 3.5% to $1.80.

Cancer drug developer Oncolytics Biotech Inc. reported late Wednesday its second-quarter loss widened slightly as operating expenses increased.

The Calgary company said its loss widened to $2.99 million from $2.95 million last year. Operating expenses rose to $905,093 from $769,51l, while stock-based compensation expenses increased to $222,376 from $8,404.

"Oncolytics made significant progress with its clinical strategy in the second quarter, announcing positive results, completing trials and preparing to initiate new trials," said Dr. Brad Thompson, president and CEO of the company. "Looking ahead, we intend to initiate enrolment in our Phase II program in the second half of 2006."

Oncolytics Biotech is a development stage company focused on development of Reolysin, a potential cancer drug.

Boston Scientific Corporation (NYSE STOCK SYMBOL BSX ) announced today that 5,000 patients with severe chronic pain have now been treated with the Precision(TM) Spinal Cord Stimulation (SCS) System. Since the Precision System was launched nationally in March 2005, the Company has introduced the advanced neuromodulation therapy to more than 600 physicians, who use the device to provide pain relief for their patients.

"Boston Scientific's Neuromodulation Group has increased patient and physician awareness about neuromodulation therapy and given pain physicians another option for treating chronic pain patients," said Richard L. Rauck, M.D., Director of the Pain Fellowship Program and Clinical Associate Professor, Department of Anesthesiology, Wake Forest University School of Medicine, Winston-Salem, North Carolina.

The Precision System is the smallest and lightest rechargeable spinal cord stimulator available. The system is designed for patient comfort and convenience, featuring a cordless portable charger that enables patients to be active while charging the device. Physicians can offer pain sufferers greater control over their pain with Precision's patented Current Sculpting technology, which is intended to precisely target the pain and provide sustained pain relief.

"We are committed to improving the quality of life for our patients through technologically advanced, high-quality products," said Jeff Greiner, President of Boston Scientific's Neuromodulation Group. "Our success is a direct result of continually striving to improve our pain management technologies so patients can live with less pain, face fewer replacement surgeries, and lead more normal lives."

The Precision SCS System treats chronic pain by delivering electrical signals to the spinal cord that mask pain signals as they travel to the brain, creating a tingling sensation called paresthesia. Spinal cord stimulation is prescribed for patients with chronic pain in the limbs, trunk, and back.

Boston Scientific (BSX) rose 3% to $17.23 after the company said 5,000 patients have now been treated with its Precision Spinal Cord Stimulation System, a rechargeable shocking device to treat chronic pain. The company is slated to report its quarterly earnings on Thursday.

Bovie Medical's (BVX) shares gained ground after the company announced it received Food and Drug Administration marketing approval for a suture-removal device for human, as well as animal, medical procedures. Shares were up 3.8% to $8.50.

Shares of DOV Pharmaceutical (DOVP) rose on positive results of an early trial on its experimental painkiller bicifadine. The drug didn't show signals of possibly causing cancer in rats or mice over two years. "This timeframe is accepted as analogous to administering the drug over a lifetime in humans," the company said in a press release. Shares of DOV were up 4.3% to $1.96.

Alnylam Pharmaceuticals' (ALNY) shares fell 1.6% to $12.40 after the company reported a wider-than-expected net loss in the second quarter.

The company lost $9.9 million, or 31 cents a share in the quarter, including $1.6 million, or 5 cents a share, in stock-based compensation expenses, compared with a loss of $11.1 million, or 54 cents a share, a year ago. Analysts were expecting the company to lose 28 cents a share. Revenue in the second quarter exceeded expectations, reaching $6 million vs. analysts' estimates of $5.6 million.

Aspect Medical Systems (ASPM) , a maker of anesthesia-monitoring systems, sank 14.9% to $15.66, despite better-than-expected earnings in the second quarter. The company earned $2.1 million, or 9 cents a share, compared with $1.6 million, or 7 cents a share, last year.

Excluding stock-based compensation expenses, the company earned 16 cents a share, compared with analysts' expectations of 14 cents. Aspect's sales were up 21% to $22.6 million in the quarter.

The company's third-quarter guidance was lower than analysts were expecting, however. In its earnings report, the company said it expects to earn 14 cents to 16 cents a share on sales of $22 million to $22.8 million. Analysts surveyed by Thomson First call were expecting earnings of 16 cents a share in the third quarter on sales of $24.1 million.

Health-care education company Healthstream (HSTM) fell despite its announcement that earnings and revenue rose in the second quarter. The company reported revenue of $8.2 million in the second quarter, up 21% from a year ago, and earnings of $289,000, or 1 cent a share. Last year, the company broke even. Shares were down 10.7% to $3.43.

Other health care companies on the move included MGI Pharma (MOGN) , down 1.2% to $15.06, and Edwards Lifesciences (EW) , off 1.3% to $42.71.

Affymetrix (AFFX) was up 3.6% to $22.25, Hemispherx Biopharma (HEB) rose 7.1% to $2.41, and YM BioSciences (YMI) added 1% to $3.11.

Mylan Gets New Emsam Patent Covering Delivery of Antidepressant Through Skin With Patch

PITTSBURGH - Drug maker Mylan Laboratories Inc. announced Wednesday that its Mylan Technologies unit received an additional patent covering the Emsam antidepressant patch.

Mylan said the patent, issued on July 4, covers the delivery of Emsam's active ingredient selegiline through the skin.

Somerset Pharmaceuticals Inc., which makes the patch for Mylan, has an exclusive license to the patent. Emsam is distributed by drug maker Bristol-Myers Squibb.

Shares of Mylan, which also reported better-than-expected first-quarter results on Wednesday, rose $2.13, or 10.5 percent, to $22.38 in midday trading on the New York Stock Exchange.

Shares of Momenta Pharmaceuticals Inc., a development-stage biotechnology company, jumped by about a third on Tuesday after the company said it reached a deal with Novartis AG to develop generic versions of four existing drugs.

Momenta, based in Cambridge, Massachusetts, said it will receive up to $263 million under the deal, including an initial payment of $75 million from Novartis' Sandoz generic unit and additional payments up to $188 million based on various milestones.

The deal covers the development of generic versions of four existing biotechnology and complex drugs.

Biotechnology drugs involve large proteins that are costly and difficult to manufacture. They must be given via injection or infusion because large proteins are destroyed by the stomach. Some other types of complex drugs also cannot be taken orally.

Momenta, which is focused on developing technology-enabled generic versions of sugar-based and other complex drugs, said the deal involves one drug it has been testing in late-stage clinical trials and two late-stage compounds from Sandoz.

The deal also expands a three-year collaboration between the companies on developing M-Enoxaparin, a generic version of Sanofi-Aventis' blockbuster anti-clotting drug Lovenox that is awaiting U.S. marketing approval.

Under the deal, the two companies will jointly develop, manufacture and sell the products, should they be approved. They will share profits, under a different formula for each medicine.

Novartis, based in Switzerland and among the world's largest drugmakers, is in the forefront of developing generic versions of complex biotechnology drugs.

Novartis will invest $75 million initially in exchange for about 4.7 million Momenta shares at $15.93 per share, which reflects a 30 percent premium to the average price of shares over the past 30 days.

Shares of Momenta were up $4.90 to $17.95 in afternoon trading on Nasdaq, after earlier rising as high as $20.98. Shares of Novartis were down 58 cents at $55.39 on the New York Stock Exchange.

THE CHALLENGES OF BIOTECH COPYCATS

The U.S. Food and Drug Administration in May approved Omnitrope, a Sandoz copycat form of Pfizer Inc.'s Genotropin human growth hormone. But the FDA said the approval did not set a precedent for approving other copycat biologics.

Although the FDA has long promised to come up with guidelines for approval of biotech drugs, it has failed to do so. Without guidelines, there is no mechanism to approve such drugs in the United States.

One of the biggest difficulties for the FDA is ascertaining that copycats of biotech drugs are chemically identical to the original branded drug.

Momenta Chief Executive Officer Alan Crane said the company's technology for analyzing the structure of complex drugs -- including ones comprised of sugars instead of proteins -- would help the FDA ascertain that biotech copycats are identical to branded drugs.

"We're not aware of any other companies with the technology that can define these complex chemical mixtures very thoroughly," Crane said in an interview.

Crane said Momenta's technology first breaks apart molecules within a complex mixture into small pieces. It then measures the fragments using specialized equipment, before conceptually reassembling them using mathematical formulas.

Momenta's technology is also used to help develop the actual process for manufacturing a drug, and then later assess the quality of the medicine, he said.

Crane said Novartis is Momenta's only current corporate partner.

Encysive stock plummets on second drug approval delay


Encysive Pharmaceuticals Inc.'s stock took a 40 percent nosedive on Tuesday morning after the company announced another delay in the approval of its pulmonary arterial hypertension drug, Thelin.

In a statement issued late Monday, Houston-based Encysive (NASDAQ:ENCY - News) said it was informed by the U.S. Food and Drug Administration in an approvable letter that it had an outstanding item related to a separate letter issued in March.

In its latest approvable letter, the FDA said that the unresolved item is a matter of judgment and expressed an openness to consider new arguments to address this remaining item, according to Encysive.

The FDA also again suggested the alternative of conducting additional clinical work. The agency also made recommendations on the company's risk management plan, which Encysive said it views as "constructive."

The news is the latest in a roller-coaster ride for Encysive as the company has worked toward U.S. approval of Thelin. The drug was recommended for approval in Europe last month.

In mid-June, Encysive shares hopped after the company said the FDA was reviewing its drug to treat high blood pressure in the pulmonary arteries, a condition called pulmonary arterial hypertension.

The company's stock ended the regular trading session on June 15 up 38.8 percent at $7.01, after rocketing to $7.24 for a gain of 43.3 percent earlier in the day.

On Tuesday morning, Encysive shares were trading at $3.72 after having traded as low as $3.43 earlier in the day -- far lower than the company's 52-week-high of $13.29.

Analyst firm Rodman & Renshaw swiftly downgraded Encycive's stock from "Market Outperform" to "Market Perform." Meanwhile, WR Hambrecht + Co analyst Patrick E. Flanigan III said Encysive's receipt of a second approvable letter "raises a shadow of doubt over the drug's approvability in the U.S." since it remains unclear as to whether or not the firm will need to conduct an additional clinical trial. WR Hambrecht maintained a "Hold" rating on the stock.

Prana Biotechnology Jumps to 52-Week High on Progress of Experimental Alzheimer's Drug

NEW YORK - Shares of Prana Biotechnology Ltd. surged to a new 52-week high after the tiny Australian biotech drug maker said Monday it plans to start a mid-stage clinical trial of its experimental Alzheimer's disease drug in the fourth quarter.

Prana shares rose $1.08, or 65 percent, to $2.74 in morning trading on the Nasdaq. Shares, which have traded between $1.21 and $2.40 over the past 52 weeks, reached a high of $2.90 earlier in the session.

The announcement comes after the company released mouse data showing the drug candidate PBT2 improved memory in five days, reduced a type of protein deposit in the brain associated with Alzheimer's, and restored function to nerve tissue impaired by the protein deposits.

Early-stage human studies have shown that PBT2 is safe in the doses proposed for treatment. The company said that a successful mid-stage clinical trial may lead to a late-stage clinical trial needed for regulatory approval.

However, Prana said that it would be at least five to six years before the drug could be developed for commercial sale.

Cardiome Pharma Shares Soar on Positive Results From Anti-Arrhythmic Drug Trial

NEW YORK -- Shares of Cardiome Pharma Corp. soared in premarket trading Monday after the cardiovascular treatment developer said its anti-arrhythmic heart medicine appears to be "well-tolerated" and safely normalized heart beats for many patients in a midstage clinical trial.

Shares soared $3.99, or about 45 percent, to $12.80 in premarket trading on the INET electronic exchange after closing the Nasdaq session at $8.91 on Friday.

The drug, called RSD1235, is being studied for its ability to prevent recurrence of atrial fibrillation, which is characterized by irregular heart beats, or arrhythmia.

The condition puts patients at a higher risk of stroke and impaired cardiac function and affects about 4 million people worldwide, Cardiome said.

Safety data from the Phase 2a pilot study, which began in December 2005, suggest that 300 mg oral doses of RSD1235 restored normal heart rhythms for 33 out of 54 patients, or 61 percent, involved in the study. That compares to 37 percent, or 10 out of 27 patients, who received placebo.

During the 28-day trial, serious adverse events occurred in 9 percent of placebo patients and 10 percent of the patients taking RSD1235.

Patients who suffered drug-related serious adverse events occurred in 3 percent of placebo patients and 4 percent of patients on the trial medication. There were no cases of a certain form of arrhythmia that is sometimes caused by other anti-arrhythmic drugs.

Results from a second phase of the study that is investigating a 600-mg dose of the drug is slated for release in the third quarter, Cardiome said.

Cardiome Pharma's (CRME) shares got a 33% boost after the company reported positive results from a trial involving its proposed heart drug for patients with abnormal heart rhythms.

Of 54 patients receiving the drug in trials, 61% finished the study with a normal heart rhythm, compared with 37% of 27 of patients receiving a placebo, the company reported. The drug, dubbed RSD1235, appeared well tolerated among trial patients. Shares were up $2.99 to $11.90.

PDL BioPharma's (PDLI) shares rose after the stock was upgraded by Deutsche Securities to a buy rating from a hold. The stock was up 6.5% to $17.59.

In March, the firm downgraded PDL's shares to hold as a result of disappointing first-quarter earnings and a lowered fiscal-year outlook, but "in our view, PDLI shares have now more than over-corrected and represent a compelling valuation opportunity ahead of potentially solid to better-than-expected [second-quarter] earnings results," wrote Deutsche biotech analyst Jennifer Chao. PDL is slated to report its quarterly earnings on Aug. 3.

Shares of WebMD Health (WBMD) and its parent Emdeon (HLTH) climbed following an announcement that the companies were awarded a contract from the U.S. Centers for Medicare and Medicaid Services.

Under the contract, the companies will conduct feasibility tests to determine how medical-claims data can be used to create a system of electronic personal-health records. WebMD was up 1.7% to $40.56, and Emdeon was adding 1.7% to $12.25.

Bayer (BAY) and its partner Onyx Pharmaceuticals were up following a weekend announcement that they received European Commission approval for Nexavar in the treatment of advanced kidney cancer.

Bayer's shares were gaining 2.2% to $48.43, and Onyx shares tacked on 1 cent to $15.35. Nexavar was approved by the Food and Drug Administration in December.

Shares of Biogen Idec (BIIB) and Elan (ELN) got a lift following word that the companies have re-released Tysabri for the treatment of relapsing forms of multiple sclerosis.

Tysabri was pulled from the market early last year when it was linked to a deadly brain disease, but after a lengthy investigation, the drug was reapproved by the FDA. Biogen Idec was up 40 cents to $41.13, and Elan rose 26 cents to $13.57.

Medical-device maker Medtronic (MDT) dipped after the FDA told doctors that it was recalling the 8731 Intrathecal Catheter and Model 8598 Intrathecal Catheter Distal Revision Kit. The recall was attributed to a possible problem during implantation that can cause infections or other potentially serious problems. Medtronic lost a penny to $47.80.

Lab-supplies seller Beckman Coulter (BEC) fell 42 cents to $55.20 following a downgrade of the stock by Matrix Research. Matrix cut Beckman to strong sell from sell.

Other health care movers included United American Healthcare (UAHC) , down 4.7% to $3.05, Ivax Diagnostics (IVD) , off 5.2% to $1.47, etrials Worldwide (ETWC) , down 9.4% to $3.94, Genitope (GTOP) , lower by 6.3% to $6.38, and drug developer Cyclacel Pharmaceuticals (CYCCP) , which fell 14.9% to $4.85.

Novartis (NVS) rose 1.1% to $55.86, and Cell Therapeutics (CTIC) was up 4.1% to $1.26.

Biogen Idec, Elan Rerelease Tysabri for U.S. Market 17 Months After Sales Halt

CAMBRIDGE, Mass. -- Biotech drug maker Biogen Idec Inc. and Ireland-based drug maker Elan Corp. said Monday its multiple sclerosis treatment Tysabri is now available in the U.S. 17 months after the companies pulled the drug from pharmacies.

In June, the Food and Drug Administration re-approved the drug with certain restrictions. Now, Tysabri must be prescribed by doctors participating in a special program called the Touch Prescribing Program. Elan runs the program through ICS, a drug distributing unit of AmerisourceBergen Specialty Group, and 12 specialty pharmacies.

Originally approved in November 2004, Tysabri was taken off the market three months later when three cases of a rare and often fatal brain inflammation occurred in multiple sclerosis patients taking the drug. Two of the patients died.

Multiple sclerosis is an incurable disease wherein the immune system attacks the insulation of the nerve fibers by mistake.

The annual wholesale cost of Tysabri per patient is about $28,400, a 20 percent premium to what some analysts had expected.

The companies also announced they launched the drug in Europe after receiving a recent approval from the European Commission.

Elan's American depositary shares rose 39 cents, or 2.9 percent, to $13.70 in premarket activity on the INET electronic exchange. Shares of Biogen closed Friday at $40.73 on the Nasdaq.

Biogen Idec, Elan Rerelease Tysabri for U.S. Market 17 Months After Sales Halt

CAMBRIDGE, Mass. -- Biotech drug maker Biogen Idec Inc. and Ireland-based drug maker Elan Corp. said Monday its multiple sclerosis treatment Tysabri is now available in the U.S. 17 months after the companies pulled the drug from pharmacies.

In June, the Food and Drug Administration re-approved the drug with certain restrictions. Now, Tysabri must be prescribed by doctors participating in a special program called the Touch Prescribing Program. Elan runs the program through ICS, a drug distributing unit of AmerisourceBergen Specialty Group, and 12 specialty pharmacies.

Originally approved in November 2004, Tysabri was taken off the market three months later when three cases of a rare and often fatal brain inflammation occurred in multiple sclerosis patients taking the drug. Two of the patients died.

Multiple sclerosis is an incurable disease wherein the immune system attacks the insulation of the nerve fibers by mistake.

The annual wholesale cost of Tysabri per patient is about $28,400, a 20 percent premium to what some analysts had expected.

The companies also announced they launched the drug in Europe after receiving a recent approval from the European Commission.

Elan's American depositary shares rose 39 cents, or 2.9 percent, to $13.70 in premarket activity on the INET electronic exchange. Shares of Biogen closed Friday at $40.73 on the Nasdaq.

Sepracor Inc. (Nasdaq SEPR) on Friday posted a second-quarter profit, reversing a year-earlier loss, but cut its forecast for the year saying sales of its sleeping pill Lunesta will be lower than expected.

The company's shares rose nearly 2 percent, however, as speculation that Sepracor could be acquired offset disappointment over sales of its insomnia treatment.

"The value play guys are hoping for a takeout some time in the future," said John LeCroy, an analyst at Natexis Bleichroeder Inc.

The Marlborough, Massachusetts-based drug company said on a conference call that the rate of growth in the sleep drug market has been hurt by concerns over claims that certain drugs can cause episodes of amnesia, sleep walking and binge eating.

As a result, Sepracor said it is lowering its forecast for 2006 Lunesta sales to $620 million from a previous forecast of $650 million, and it cut its 2006 earnings per share forecast to $1.13 a share from a previous forecast of $1.50 a share. Its revenue outlook fell to $1.175 billion from $1.275 billion.

"The market has really changed over the past six months," said David Southwell, Sepracor's chief financial officer, in an interview.

The decision by U.S. regulators not to approve a long-lasting form of indiplon, an experimental insomnia drug being developed by Neurocrine Biosciences Inc. and Pfizer Inc. , removes a potentially formidable competitor to Lunesta. It could also make Sepracor an attractive takeover candidate.

However, the absence of Pfizer, the world's biggest drug company, also places more of the burden for expanding the market on Sepracor, Southwell said.

"We had thought we would spend a lot on direct-to-consumer advertising in the first half and back off in second half," he said. "Now we find we're the lead dog in the sled and to expand the market we need to expand our marketing and promotion budget in the second half of the year."

Sepracor said it needs to differentiate Lunesta from other products if it is to sustain its rate of growth. The company is gathering an increasing amount of clinical data showing Lunesta to be effective in patients with co-existing conditions such as depression, anxiety, rheumatoid arthritis and menopause.

Sepracor reported a net profit in the latest quarter of $11.7 million, or 10 cents a share, compared with a loss of $7.4 million, or 7 cents a share, a year ago.

Analysts had on average expected earnings of 9 cents a share, according to Reuters Estimates.

Revenue rose to $264.4 million from $185 million a year ago. Sales of Lunesta rose to $139.1 million, from $83.5 million a year ago. The drug was launched in April last year.

Sales of asthma medication Xopenex, rose to $117.3 million in the quarter from $83.2 million a year ago.

The company's shares rose 91 cents to $48.88 in early afternoon trading on Nasdaq.

Shares of drug developer Sepracor (SEPR) took a hit after the company reported disappointing sales. Sepracor fell 2.7% to $46.68.

The top line of $264.4 million was an increase from $185.1 million last year, but it missed Wall Street's consensus target of $279.4 million. Earnings were $11.3 million, or 10 cents a share, compared with a loss of $7.4 million, or 7 cents a share, in the year-ago period. The latest second quarter included charges of $10.6 million, or 9 cents a share, for stock-based compensation.

Analysts expected earnings of 9 cents in the second quarter.

Nektar Therapeutics (NKTR) fell 3.5% to $16.10 after research firm Miller Johnson initiated coverage of the company with a market-perform rating.

Shares of HealthStream (HSTM) , the Internet-based health education and information provider, sank 10.3% to $3.30 a day after an announcement that its competitor WebMD (WBMD) plans to acquire Medsite's medical education, promotion and physician recruitment businesses.

Enzo Biochem's (ENZ) shares fell after a court ruled that pharma-giant Roche didn't infringe its patents on a genetic information-detection technique. Enzo's shares were down 3.5% to $12.

Amylin Pharmaceuticals (AMLN) lost 7.4% to $45.76 after the stock was downgraded by Lehman Brothers to equal-weight from overweight.

Amgen (AMGN) was rising following a positive second-quarter earnings report after the close of trading Thursday. While the company took a significant charge related to the acquisition of Abgenix, excluding that and certain other items Amgen exceeded analysts' earnings estimates. Shares were up 3.9% to $66.41.

Other health stocks on the move included Sunesis Pharmaceuticals (SNSS) , up 1.8% to $5,

Aspreva Pharmaceuticals (ASPV) , rising 6.7% to $21.75, and orthopedic-implant maker Zimmer Holdings (ZMH) , adding 3.5% to $54.90.

Novartis (NVS) was up 1.4% to $55.10, GlaxoSmithKline (GSK) rose 0.9% to $55.41, and Johnson & Johnson (JNJ) was gaining 0.7% to $61.77.

Teva Pharmaceutical (TEVA) was down 1.6% to $29.73, Keryx Biopharmaceuticals (KERX) was losing 2.2% to $11.18, Boston Scientific (BSX) was off 1.3% to $15.77, Progenics Pharmaceuticals (PGNX) was down 2.1% to $21.07, and Vertex Pharmaceuticals (VRTX) was declining 2.3% to $34.17.

Mycophenolate Mofetil Approved for Treatment of Lupus Nephritis in Malaysia


- Aspreva Pharmaceuticals Corporation (NASDAQ: ASPV), reports that Mycophenolate Mofetil (MMF, CellCept®) has been approved for the treatment of lupus nephritis in Malaysia. On July 11, 2006, Roche Malaysia received a letter of approval from the Drug Control Authority (DCA) in Malaysia granting them approval to include lupus nephritis as an additional indication for MMF in the induction and maintenance treatment of lupus nephritis (used concomitantly with corticosteroids). Malaysia is the first country to have regulatory approval of MMF in any autoimmune disease.

The supporting documents used in the application consisted of published clinical papers and the expert clinical report prepared by key opinion leader Dato Dr. Zaki Morad, Head of Nephrology at Hospital Kuala Lumpur. Dato Dr. Morad's report on the clinical trial of MMF in lupus nephritis was published in the October 2005 issue of the journal Nephrology. The trial was conducted at eight centres in Malaysia, comparing intravenous cyclophosphamide to MMF in the induction therapy of proliferative lupus nephritis.

Aspreva is conducting a global phase III study to assess the efficacy and safety of MMF in inducing response and maintaining remission in patients with lupus nephritis. Aspreva's two-phase induction and maintenance study is a randomized, open label comparison of MMF to intravenous cyclophosphamide in the first six months or induction phase, followed by a double-blind comparison of MMF to azathioprine for up to three years during the maintenance phase. The first patient in the Aspreva study was treated in July 2005, and completion of the induction phase of the trial is expected in early 2007.

About Lupus Nephritis

Systemic lupus erythematosus (SLE), commonly called lupus, is a chronic autoimmune disease that causes the body to attack its own tissues and joints.

Lupus nephritis is the most serious manifestation of the disease, which, if left untreated, can lead to kidney failure, requiring dialysis. It is a complicated disease as patients typically fluctuate between periods of intense disease activity when the patient's own immune system is actively attacking and causing damage in their kidney, interspersed with periods of remission. Clinicians estimate that one third to one half of lupus patients have lupus nephritis.

There has been no new approved treatment for SLE or lupus nephritis in the United States in over thirty years. Current treatments involve the off-label use of existing cancer drugs such as cyclophosphamide, steroids, and other immunosuppressant drugs such as azathioprine.

About CellCept

CellCept is F. Hoffmann-La Roche's (Roche) leading immunosuppressant or "anti-rejection" drug used in combination with other immunosuppressive drugs (cyclosporine and corticosteroids) for the prevention of rejection in patients receiving heart, kidney and liver transplants. CellCept was first approved for use in combination therapy for the prevention of acute organ rejection in kidney transplantation in 1995 and has since been approved worldwide for prevention of organ rejection in adult kidney, heart and liver transplantation. In some countries, it has also been approved for paediatric kidney transplantation. This therapeutic success represents 10 years of clinical experience and patient benefits, including reduced toxicities and prolonged graft and patient survival. Over the last decade, CellCept has become the world's most widely studied immunosuppressant and research is ongoing both in organ transplantation and related areas, such as autoimmune disease, to help provide clinical benefit to a wider range of patients.

In July 2003, Aspreva signed a collaboration agreement with Roche for the exclusive worldwide rights (excluding Japan) to develop and, upon regulatory approval, commercialize CellCept for all autoimmune disease applications.

About Aspreva Pharmaceuticals

Aspreva is an emerging pharmaceutical company focused on identifying, developing and, upon regulatory approval, commercializing new indications for approved drugs and late stage drug candidates for patients living with less common diseases. Aspreva is listed on the NASDAQ Global Select Market under the trading symbol "ASPV" and on the Toronto Stock Exchange under the trading symbol "ASV". For further information on Aspreva, please visit www.aspreva.com.

This press release contains forward-looking statements or information within the meaning of the Private Securities Litigation Act of 1995 and applicable Canadian Securities Legislation. These include, without limitation, statements or information related to our strategy, future operations, clinical trials, prospects and plans of management. Words such as "anticipates," "believes," "estimates," "expects," "intends," "may," "plans," "projects," "will," "would" and similar expressions are intended to identify forward-looking statements or information, although not all forward-looking statements or information contain these identifying words. These forward-looking statements or information are based upon our current expectations and we may not actually achieve the plans, approvals, intentions or expectations disclosed in our forward-looking statements or information. Forward-looking statements or information involve risks and uncertainties. Our actual results and the timing of events could differ materially from those anticipated in such forward-looking statements or information as a result of these risks and uncertainties, which include, without limitation, risks related to difficulties or delays in the progress, timing and results of our clinical trials, our ability to attract and retain collaborations relating to the development and commercialization of new indications, difficulties or delays in obtaining regulatory approval, the FDA may finally determine that the design and planned analysis of our clinical trials do not adequately address the trial objectives in support of our regulatory submission, competition from other pharmaceutical or biotechnology companies, and other risks detailed in our filings with the Securities and Exchange Commission and Canadian securities regulatory authorities. You are cautioned not to place undue reliance on these forward-looking statements or information, which speak only as of the date of this press release. All forward-looking statements or information are qualified in their entirety by this cautionary statement, and Aspreva undertakes no obligation to revise or update any forward-looking statements or information as a result of new information, future events or otherwise after the date hereof.

Nexavar gets fast-track designation for skin cancer


- U.S. regulators have granted fast-track designation to kidney cancer drug Nexavar for the treatment of advanced melanoma, a form of skin cancer.

Nexavar, made by Bayer Pharmaceuticals Corp. and Onyx Pharmaceuticals Inc , was approved by the U.S. Food and Drug Administration in December 2005 for the treatment of patients with advanced renal cell carcinoma.

Fast-track designation is designed to speed the review of drug compounds for the treatment of patients with serious or life-threatening diseases where there is an unmet medical need.

Bayer's (BAY) shares rose following an announcement that the company and its partner Onyx Pharmaceuticals (ONXX) received fast-track designation from the Food and Drug Administration for the drug Nexavar for treating skin cancer.

Nexavar is already approved to treat advanced kidney cancer. Bayer's shares were up 1.7% to $47.63, but Onyx was falling 1.5% to $15.49.

West Pharmaceuticals (WST) , a maker of drug-delivery devices, preannounced positive second-quarter earnings after the market closed Wednesday, sending its shares 5.7% higher to $37.06.

The company says it expects to report earnings of between 60 cents and 62 cents a share Aug. 3, compared with 38 cents a year ago. West also raised its full-year guidance to $1.82 to $1.88 a share, up from its previous estimate of between $1.68 and $1.78 a share. Sales are forecast at roughly $880 million to $900 million.

Baxter International's (BAX) shares jumped 6.2% to $40.96 after the company raised its guidance for the full year.

While the company earned 47 cents a share in the second quarter vs. 51 cents a year ago, it brought in sales of $2.6 billion, up 3% from last year. For the full year, Baxter expects to see sales growth of around 6% and earnings of between $2.21 and $2.25, excluding certain charges, compared with the company's previous guidance of $2.10 to $2.16.

Endo Pharmaceuticals' (ENDP) shares fell 2.5% to $30.64 despite a positive earnings report Thursday morning. The maker of painkilling drugs reported earnings of 43 cents a share compared with 37 cents last year and reaffirmed its full-year EPS guidance of $1.55 to $1.60.

The company expects net sales of between $880 million and $910 million with $530 million to $540 million coming from sales of Lidoderm, a topical painkiller for patients with shingles, and $50 million to $60 million from sales of its generic version of the painkiller OxyContin.

Shares of Cubist Pharmaceuticals (CBST) declined 2.6% to $22.70, despite positive news coming out of its earnings report. The company said its revenue rose 69% to $47.8 million, leading to a narrower loss in the second quarter of 9 cents a share compared with a loss of 15 cents a share a year ago.

Excluding one-time charges, as well as 5 cents a share in stock-based compensation expenses, the company earned 6 cents a share.

HIV drugmaker Gilead Sciences' (GILD) shares dipped following an announcement after the close of trading Wednesday that the company will exercise its option to buy Corus Pharma, a maker of infectious-disease treatments, for $365 million. Gilead, which is already the second-largest shareholder after investing $25 million in the company earlier this year, expects to close the deal in the third quarter. Gilead shares were 4.2% lower to $58.65.

IMS Health's (RX) shares fell after the company reported quarterly earnings of 30 cents a share vs. 41 cents a year ago. Second-quarter revenue was up 12%, however, to $486.2 million, and the company boosted full-year guidance to between $1.47 and $1.53 from $1.45 to $1.51, excluding stock-based compensation expenses. Shares of IMS, a provider of information to the health care industry, were down 1.6% to $26.58.

Shares of WebMD Health (WBMD) were lately lower following news that the medical-information provider plans to expand its business through an acquisition of the education and physician recruitment businesses of Medsite for $41 million in cash. The deal should close in the third quarter. Shares fell 0.7% to $40.41.

Affymetrix Shares Fall After Company Cuts Price on Key Product to Compete With Illumina

-- Shares of genetic analysis technology company Affymetrix Inc. slipped Wednesday following the company's move to reduce prices of a product used to test drug candidates.

The company said late Tuesday it is immediately cutting prices on its 500K SNP (single nucleotide polymorphisms) system to $250 and will offer the two-chip system as a single array by the end of the year. The company did not detail the product's original price, but UBS Investment Research analyst Derik De Bruin estimates it at around $750.

The company's stock slid $1.07, or 4.6 percent, to $22.28 on the Nasdaq in morning trading. It hit a new 52-week low earlier in the session, sliding to $22.02 before regaining some ground.

Analysts attribute the price-cutting move to growing competition from rival Illumina Inc. Illumina recently launched chip, the HumanHap550, which contains over 550,000 SNP on one chip, making it more powerful than Affymetrix's product, which contains 500,000.

Affymetrix said Tuesday it plans on releasing a system with 1 million SNP by the first quarter of 2007, with an expected price of $500.

While several analysts held their ratings for Affymetrix, some price targets were lowered on concerns over sales volume.

"We interpret Affymetrix's announcements as a sign that its genotyping business likely will not rebound until 2007," wrote Baird analyst Quintin J. Lai in a research report Wednesday.

Lai maintained a "Neutral" rating but cut his price target to $25 from $30, saying the price cut in its genotyping system is a "negative reflection on its current competitiveness" against Illumina's product.

UBS Investment Research analyst Derik De Bruin maintained his "Reduce" rating, but shaved his price target to $22 from $23, citing competition.

"Affymetrix has dominated the microarray arena, but execution problems have undercut investor confidence, calling into question (its) competitive position in the market outlook," he wrote in a report to investors.

While the price cutting move may help the company maintain its market share in the near-term, De Bruin said growth and margins could be constrained if it doesn't ramp up volumes.

Shares of Illumina surged $6.86, or 23.8 percent, to $35.71 on the Nasdaq in morning trading, eclipsing their previous 52-week high of $32.60 set July 6.

Wednesday Closing Prices

AFFYMETRIX INC (Nasdaq AFFX) 21.54 Down 1.81 (7.75%)

ILLUMINA INC (Nasdaq ILMN) 37.10 Up 8.24 (28.55%)

Biopharmaceutical company Tercica (TRCA) saw its shares rise 8% to $5.08 after the company announced a worldwide collaboration agreement with European pharmaceutical company Ipsen.

Ipsen will initially acquire 25% of the company with the option to increase its stake to as much as 40%. The companies will share development rights to endocrine treatments and sign cross-licensing agreements for Somatuline Autogel, a treatment for a hormone disorder that causes abnormal growth of the hands and feet, and Increlex, a treatment for short stature.

Shares of embryonic stem-cell company Geron (GERN) were up 3.7% to $6.38, even though President Bush vetoed a bill to ease federal funding limitations on stem-cell research. The bill supports the use of human embryos taken from in-vitro fertilization that would otherwise be discarded. An override is believed to be unlikely.

However, giving Geron a lift was the publication of trial results supporting the safety of the company's experimental human embryonic stem-cell therapy to treat spinal cord injuries.

Theragenics (TGX) rose 4.5% to $3.23 following the company's announcement that it swung to a profit in the latest quarter thanks to restructuring and its recent acquisition of CP Medical. Theragenics reported earnings of $433,000, or 1 cent a share, in the latest quarter, compared with a loss of $1 million, or 3 cents a share, a year earlier.

Genetic-testing technology company Illumina (ILMN) jumped 27.6% to $36.83 after the stock was upgraded to outperform from neutral by Baird and to overweight from neutral by analysts at research firm Global Crown Capital.

Affymetrix (AFFX) sank 5% after UBS lowered its price target for the stock by a dollar to $22 and reduced its earnings and revenue estimates for the company.

Other movers included Savient Pharmaceuticals (SVNT) , up 8.6% to $5.68; Adventrx Pharmaceuticals (ANX) , up 8.7% to $2.88; PainCare Holdings (PRZ) , higher by 4.2% to $1.74; and Centene (CNC) , rising up 8.5% to $14.75.

IDM Pharma (IDMI) was down 10.1% to $3.12; ChemGenex Pharmaceuticals (CXSP) fell 7.3% to $4.30; and Genelabs Technologies (GNLB) lost 2.3% to $1.27.

Antares Pharma Developing Disposable Injection Device for Teva Pharmaceutical Industries

EXTON, Pa. -- Antares Pharma Inc. said Tuesday it is developing a new disposable injection device for Israeli generic drugmaker Teva Pharmaceutical Industries Ltd.

The drug delivery technology developer said Teva is purchasing the device for an undisclosed product still awaiting regulatory approval.

As part of the deal, Antares will receive an initial cash payment, as well as milestone fees and a negotiated percentage of Teva's profit on the unnamed drug.

Shares of Antares, which closed Monday at $1.10 on the American Stock Exchange, were up 4 cents, or 3.6 percent, at $1.14.

GlaxoSmithKline's (GSK) shares rose after Indian generics firm Ranbaxy Laboratories said one of its units would acquire Glaxo's Mundogen generics business in Spain. Specific financial terms weren't disclosed. Glaxo's shares were up 42 cents, or 0.8%, to $54.45.

Chelsea Therapeutics' (CHTP) shares gained 14.4% to $3.90 after the company said it appointed 25-year pharmaceutical sales veteran Keith Schmidt as president of marketing and sales to support the launch of Droxidopa.

Chelsea is pursuing an orphan-drug status for the experimental compound and is preparing late-phase trials on the drug to support its application to the Food and Drug Administration.

Medical-supply company Antares Pharma (AIS) jumped after it said it signed an agreement with generic-drug maker Teva Pharmaceutical (TEVA) to develop a disposable injector device. Antares will receive an upfront fee, milestone payments and a percentage of gross profits. Antares shares were up 4.6% to $1.15.

Among other stocks on the move were biopharmaceutical company Praecis (PRCS) , down 11.9% to $2.30, specialty pharmaceutical company Pharmos (PARS) , off 8.3% to $1.76, respiratory-care devices maker Chad Therapeutics (CTU) , down 7.4% to $2.50, and genetic-test developer Interleukin Genetics (ILI) , lower by 3.6% to $5.69.

Biopharmaceutical company Gilead Sciences (GILD) was up 45 cents, or 0.8%,to $59.85, and drugmaker Barr Pharmaceuticals (BRL) rose 2.2% to $46.28. Drug developer Nucryst Pharmaceuticals (NCST) was up 1.6% to $14.91.

Also moving higher were Auxilium Pharmaceuticals (AUXL) , up 1% to $7.89, Regenerx Biopharmaceuticals (RGN) , rising 4.3% to $2.42, and Adventrx Pharmaceuticals (ANX) , adding 3.3% to $2.48.

Pharmaceutical Product Development 2Q Profit Jumps 75 Percent, Tops Street View

WILMINGTON, Del. -- Pharmaceutical Product Development Inc. said Monday its second-quarter profit jumped 75 percent as demand for drug discover and development services grew.

Results easily topped Wall Street's consensus expectations, sending shares of the company sharply higher in the aftermarket session.

The company, which offers a range of laboratory services and support services, said it earned $36.4 million, or 31 cents per share, compared with earnings of $20.8 million, or 18 cents per share, last year. Revenue jumped 26 percent to $309 million from $245.1 million.

Analysts polled by Thomson Financial expected more modest earnings of 29 cents a share on revenue of $274.5 million.

The company saw its largest boost in revenue come from development services, with its biggest clients being biotechnology and pharmaceutical companies. That segment saw a 24 percent increase in business, bringing in $278.9 million.

In comparing the second-quarter figures, the company revised last year's figures to account for stock option expensing.

"We believe our second quarter operating results demonstrate continued strength in the market as well as PPD's ability to perform well across the continuum of global drug development markets and service segments," said Fred Eshelman, chief executive.

Shares of Pharmaceutical Product Development added $2.49, or 6.9 percent, to $38.45 in Tuesday's trading on the Nasdaq.

Neurocrine Biosciences Widens 2Q Loss in Aftermath of Pfizer Breakup on Indiplon

-- Neurocrine Biosciences Inc. said Monday it widened its losses during the second quarter as revenue shrunk and the company ramped up spending on its sales force.

The biotechnolgy company, with its focus on treating insomnia, said it lost $27.4 million, or 73 cents a share, compared with a loss of $5.6 million, or 15 cents a share a year prior. Revenue shrunk to $9.2 million from $33.2 million as sponsored research and development, and milestone payments, each dropped to below $1 million.

Analysts polled by Thomson Financial expected a loss of 72 cents a share on revenue of $22.9 million.

The loss caps a quarter that saw the company's stock sink to below $10 for the first time since 1999. The plummet occurred after Pfizer returned all the rights on the company's top prospect, Neurocrine's insomnia treatment Indiplon. Pfizer dropped Neurocrine as a partner after the U.S. Food and Drug Administration said it could not approve the high-dose extended release version of the drug.

Analysts were expecting that version of the drug to be the key to the market.

In a statement Monday, Neurocrine said it is continuing work on development plans with the FDA for Indiplon. The company has several other drug candidates in mid-stage trials and set 2006 guidance at a net loss of more than $130 million.

Shares of Neurocrine Biosciences fell 27 cents, or 2.8 percent, to close at $9.42 on the Nasdaq. They have traded between $8.61 and $73.13 over the past year.
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Threshold Pharmaceuticals (THLD) sank more than 50% after the company said a proposed treatment for a prostate condition didn't show significant efficacy and caused serious side effects in clinical trial patients.

The drug, dubbed TH-070, didn't significantly reduce symptoms in patients with a condition known as benign prostatic hyperplasia, a noncancerous enlargement of the prostate. In addition, the drug caused 13 patients to have an elevation in liver enzymes compared with two patients receiving a placebo. In six of the patients, the side effects were considered serious adverse events.

Threshold plans to revise its financial guidance for the year. Shares lost $1.50 and were trading at $1.48.

Specialty pharmaceutical company QLT (QLTI) fell 4.9% to $6.59 after the eye-drug maker announced lowered sales of its vision-loss drug Visudyne. According to the company, sales of the treatment for wet age-related macular degeneration fell 26.1% from the second quarter of last year. Sales declined 10.7% from the first quarter.

Eli Lilly's (LLY) drug Gemzar was approved by the Food and Drug Administration to treat women living with recurrent ovarian cancer. Shares of the drugmaker, which is slated to report its quarterly results later this week, added 34 cents to $54.90.

The approval goes against the March recommendations of an FDA advisory panel, which concluded that the survival advantage of a few weeks for patients taking the drug for ovarian cancer didn't make up for the drug's toxicity risks when used in combination with chemotherapy. Gemzar is already approved to treat pancreatic and lung cancers.

Medical-device makerMedtronic (MDT) received FDA approval for its Guardian continuous glucose-monitoring device for diabetes management. The real-time device is designed to help patients control their glucose levels by alerting them when their blood sugar is too high or low. The company's shares were up 43 cents to $47.48.

Johnson & Johnson's (JNJ) shares also moved higher, as investors await the company's quarterly earnings report Tuesday morning. Shares were up 45 cents, or 0.7%, to $60.91.

Other health stocks moving higher included health care management company United American Healthcare (UAHC) , whose shares were up 1.7% to $3, drug developer Novogen (NVGN) , whose shares rose 4.5% to $11.14, and GTC Biotherapeutics (GTCB) , up 5.2% to $1.43.

Among the day's losers were drug-delivery technology company NexMed (NEXM) , down 6.6% to 71 cents a share, biotech giant Genentech (DNA) , down $1.13 to $78.33, and generic drugmaker Teva Pharmaceutical (TEVA) , lower by 11 cents to $30.39.

Threshold Pharmaceuticals to Stop Developing Enlarged Prostate Drug After Clinical Trials Fail

REDWOOD CITY, Calif. -- Shares of Threshold Pharmaceuticals Inc. fell on Monday after the biotech company said it would stop development of an enlarged prostate treatment following the failure of two clinical trials.

Threshold's stock fell 1.60 or 50.31%, to $1.58 in trading on Nasdaq. Shares, which hit a 52-week high of $16.98 in April, dropped to just above $3 in May after the Food and Drug Administration found a possible safety risk in one of the trials.

The company said that its mid-stage clinical trial and late-stage clinical trial both failed to show that the drug candidate TH-070 significantly improved symptoms of benign prostatic hyperplasia compared with a placebo.

In May, the FDA halted the late-stage trial after the company reported that six patients taking TH-070 developed elevated liver enzymes, an indication of liver injury.

Forest Labs Stock Soars on Patent Victory for Antidepressant Lexapro

NEW YORK -- Shares of drug maker Forest Laboratories Inc. soared Friday, a day after a federal judge upheld a patent for the antidepressant Lexapro.

Shares of Forest Labs rose $6, or 16 percent, to close at $44.40 on the New York Stock Exchange, near the high end of a 52-week range of $34.54 to $48.51.

Judge Joseph J. Farnan of the U.S. District Court in Delaware ruled that the patent on Lexapro was valid and infringed by a generic version proposed by Teva Pharmaceutical Industries Ltd. The patent expires in March 2012.

The ruling spurred at least two investment backs to upgrade their ratings on Forest Lab's stock. Jefferies & Co. analyst David Windley upgraded the shares to a buy from a hold, saying the decision removed a factor that had been stifling the stock and diverting attention away from the company's pipeline of other products.

Patricia Bank, an analyst at Pacific Growth Equities, raised Forest Labs to a buy from neutral, noting a rebound in the antidepressant market, a solid pipeline and the possibility that sales of Alzheimer's drug Namenda could be better than expected.

Forest labs sued Ivax Corp., which was acquired by Teva this year, when it applied to the Food and Drug Administration to make a generic version of Lexapro. In late May, the agency granted generic approval to Ivax.

Representatives at Teva declined to comment on the ruling.

Lexapro sales accounted for $1.87 billion of Forest's $2.96 billion in 2005 revenue.

Forest Laboratories (FRX) shares jumped $5.62, or 14.6%, to $44.02 after the company announced that a Federal district court rejected a patent challenge by Teva Pharmaceutical (TEVA) on its antidepressant Lexapro. On Friday, Jefferies & Co. analyst David Windley upgraded the stock to buy from hold.

Schering AG (SHR) shares rose 52 cents to $116.53 after the company said it planned to collaborate with privately held Avid Radiopharmaceuticals to develop diagnostic-imaging agents used during scans to diagnose Alzheimer's disease.

Shares of Milestone Scientific (MSS) jumped 8.9% to $1.35. The company announced that the Food and Drug Administration approved the company's premarketing activities for its CompuFlo computer-controlled infusion pump.

The Livingston, N.J., maker of anesthetic-delivery systems says it's seeking partnership opportunities in the anesthesia market and plans to initially target the $200 million-plus market for epidural injections used in childbirth and in patients with low back and leg pain.

Tutogen Medical's (TTG) shares were 6.6% higher to $4.99 Friday. After the close of trading Thursday, the surgical-products maker said its second-quarter sales were up 21% to $9.1 million thanks to its dental segment sales and improved performance at its European operations.

The company also said gross margins rose to 55% in the second quarter, from 38% a year ago, which serves as "a strong indication that we are making significant progress toward our goal of consistent profitability."

Shares of Micrus Endovascular (MEND) rose following an announcement that certain shareholders will sell 1.27 million shares at $11.89 each.

The company says it won't receive any proceeds from the sale by the stockholders, but if underwriters exercise a 30-day option to buy an additional 190,531 shares to cover overallotments, it will receive funds. Micrus said it would use the proceeds for general expenses, working capital, geographic expansion and potential future acquisitions. Shares were up 1.3% to $12.06.

Shares of Decode Genetics (DCGN) sank 8.5% to $5.20 Friday after the company said it plans to raise $30 million through a common stock offering.

The company says several new and existing institutional investors have agreed to buy a total of 6 million shares at $5 a share, to raise $27.8 million after expenses. The deal is expected to close on or around July 18, the company says.

Shares of Merit Medical Systems (MMSI) sank despite an announcement that the company received approval from European regulators to market its Impress catheter. The device is already approved in the U.S. Shares fell 3.1% to $12.88.

Merck (MRK) fell 1.4% to $36.43. According to a report in The Wall Street Journal, the company's share of new prescriptions of the cholesterol-lowering drug simvastatin, known by the Merck brand name Zocor, took a hit. Despite the company's price cuts on the drug, generic drugmakers took 49% of new prescriptions in the U.S.

Other health stocks on the move Friday include Sunesis Pharmaceuticals (SNSS) , down 1% to $5.44; eye-drug developer InSite Vision (ISV) , down 5.6% to $1.35; SGX Pharmaceuticals (SGXP) , down 5.3% to $5.20; and Medtox Scientific (MTOX) , 5.4% lower, trading at $8.58.

Tenet Healthcare's (THC) shares fell 1.4% to $6.31; Vertex Pharmaceuticals' (VRTX) shares fell 1.6% to $34.07; and Boston Scientific (BSX) shares dipped 3 cents to $15.95.

Among stocks moving higher, PainCare Holdings (PRZ) was up 2.9% to $1.78; Antares Pharma (AIS) rose 1.9% to $1.06; and Abbott Laboratories (ABT) shares were up 5 cents to $44.04.

Peregrine Pharmaceuticals Posts Wider Fiscal 2006 Loss As Revenue Drops Sharply, Costs Increase

TUSTIN, Calif. -- Peregrine Pharmaceuticals Inc. shares slipped in premarket trading Friday after the drug maker said it posted a wider loss in fiscal 2006, as revenue from its contract manufacturing subsidiary fell and costs increased.

Losses for the year ended April 30 totaled $17.1 million, or 10 cents per share, compared with a loss of $15.5 million, or 11 cents per share last year. The number of shares outstanding increased to 168.3 million from 144.8 million.

Revenue dropped 36 percent to $3.2 million from $5 million during the same period last year.

Avid Bioservices, the company's contract manufacturing subsidiary, contributed $3 million in contract manufacturing revenue, 36 percent less than the $4.7 million in contributed last year.

Peregrine uses the facility to support its clinical-stage drugs being developed to treat hepatitis C and cancer.

Total costs rose 8 percent to $22.3 million, from $20.7 million last year, due to an increase in research and development expenses as well as selling, general and administrative expenses.

Company shares dropped 3 cents to $1.37, after closing at $1.40 on Thursday on the Nasdaq.

Nastech Pharmaceutical Company Inc. said it received word from the Food and Drug Administration that its abbreviated new drug application (ANDA) for a nasal spray to treat osteoporosis is "not approvable at this time."

Shares in Bothell-based Nastech (NASDAQ: NSTK - News) plummeted more than 20 percent in early trading Thursday on the news.

According to Nastech, the FDA expressed a concern relating to the potential for "immunogenicity that might result from a possible interaction between calcitonin-salmon and chlorobutanol, the preservative in the formulation." Immunogenicity refers to inducing an immune response.

Officials at Nastech were hoping its generic product would compete with branded formulations of calcitonin-salmon spray, which had 2005 U.S. sales of approximately $225 million.

They added that they intend to keep talking to the FDA to "determine which, if any, additional data Nastech can submit to the FDA in order for the FDA to approve the ANDA."



Shares of Epix Pharmaceuticals (EPIX) , a maker of drugs used in medical imaging, fell 7.4% to $4.49 after the company said Schering (SHR) won't exercise its option on the development of a drug intended to help doctors find blood clots using an MRI.

Schering is merging with another German drug company, Bayer (BAY) . Epix says it intends to seek another collaborator for the development of the drug, dubbed EP-2104R.

Johnson & Johnson's (JNJ) shares dipped 8 cents to $60.54 after the company's Cordis medical-device division acquired the privately held wound-closure firm Ensure Medical. Terms of the deal weren't disclosed, but J&J expects to take a charge of $52 million after taxes, or 2 cents a share, for acquired research and development.

Following the close of trading Wednesday, J&J announced positive efficacy results from a trial of its schizophrenia drug Paliperidone ER, saying it significantly delayed the recurrence of symptoms.

Diagnostics-device maker Biosite (BSTE) said the FDA cleared its Triage TOX drug screen as a way to identify patients on methadone, a drug that's known to interact with a number of other medications. Shares fell 0.7% to $45.60.

Biopharmaceutical company Corautus Genetics (VEGF) was up 3.6% to 87 cents after the company said the FDA lifted the clinical hold imposed in March on trials of its drug Genasis. The drug is intended to increase the length of time patients with severe angina can exercise.


Tapestry Pharmaceuticals (TPPH) , down 8% to $3, Cephalon (CEPH) , whose shares fell 2.6% to $62.16, Genetic Technologies (GENE) , down 6.5% to $8.32, and Novavax (NVAX) , whose shares were 1.8% lower at $4.34.

Among those rising were Omrix Biopharmaceuticals (OMRI) , up 2 cents to $11.85, and GenVec (GNVC) , up 2.3% to $1.31.

Kos Pharmaceuticals Submits FDA Application for New Niaspan Form That Lowers Flushing Effect

CRANBURY, N.J. - Drug maker Kos Pharmaceuticals Inc. said Wednesday that it submitted a drug application to the Food and Drug Administration for a new form of its Niaspan cholesterol medication that cuts down on flushing, the drug's most common side effect.

In clinical trials, up to 88 percent of people taking Niaspan experienced flushing, characterized by redness, warmth, itching, or a tingling sensation that can occur on the face, neck, chest, and back.

The company said its new version, Niaspan CF, was shown to reduce the severity of flushing by 42 percent, and duration by 43 percent, when compared to regular Niaspan.

Niaspan is a proprietary formulation of extended-release niacin that raises levels of high density lipids, or "good" cholesterol.

Kos plans to launch Niaspan CF in the first quarter of 2007.

Shares of Kos rose 10 cents to $39.08 in afternoon trading on the Nasdaq.

Genentech's (DNA) shares fell Wednesday after the company's sales of its highly touted cancer drug Avastin came in short of expectations for the second quarter. Even though overall earnings and revenue were strong, and Genentech lifted its full-year forecast, shares fell 3.6% to $81.05.

Medical-device maker Cyberonics (CYBX) sank following an announcement that the company would delay filing its form 10-K with the Securities and Exchange Commission pending the completion of an inquiry into its previous stock-option grants and accounting issues arising from the results of the review.

Separately, Cyberonics said it received Food and Drug Administration approval of a new label for its vagus nerve stimulating device used to treat epilepsy and depression, as well as new programming software for the VNS therapy device model 250. Shares were down 0.9% to $21.62.

Shares of Teva Pharmaceutical (TEVA) fell after the company said it was ending its marketing agreement with Japanese pharmaceuticals company Eisai for the Parkinson's disease drug Azilect. The companies entered the agreement in May 2003, and since then Teva's neuroscience sales efforts have doubled, the company says. Shares fell 1.6% to $31.57.

Sanofi-Aventis (SNY) dipped despite results from a recent study showing its drug Ambien CR is well-tolerated and effective in improving sleep for up to six months in patients with chronic primary insomnia. Shares fell 30 cents to $49.38 lately.

Genzyme's (GENZ) stock rose 8% to $62.61 after the maker of drugs for rare diseases reported earnings and revenue that beat estimates.

The company reported second-quarter revenue of $793.4 million, beating estimates of $778.6 million. Excluding certain charges, the company earned 68 cents a share in the second quarter vs. analysts' estimates of 66 cents a share.

Shares of Hi-Tech Pharmacal (HITK) , a manufacturer of liquid prescription and over-the-counter drugs and nutritional products, rose 6.2% to $18.26 after the company reported fourth-quarter results that included sales growth of 15% and a 33% increase in earnings per share.

Kos Pharmaceuticals' (KOSP) shares gained 18 cents to $39.16 after the company said it applied for FDA approval of a complete dosage range for its once-daily cholesterol drug Niaspan.

Genentech Second-Quarter Earnings Soar 79 Percent to $531M, Topping Wall Street Expectations

SAN FRANCISCO -- Genentech Inc., the nation's largest biotechnology company in terms of market capitalization, blew past Wall Street expectations on Tuesday with a 79 percent jump in second quarter earnings, driven largely by the continued popularity of its cancer fighting drugs.

For the quarter ended June 30, the company, which is based in South San Francisco, Calif., earned $531 million, or 49 cents per share, up from the previous year's $296.2 million, or 27 cents per share.

Excluding special expenses, Genentech said it would have earned $602 million, or 56 cents a share. On that basis, the results exceeded the per-share estimate among Wall Street analysts by 9 cents, according to research firm Thomson Financial.

Revenue increased 44 percent to $2.2 billion from $1.5 billion in the second quarter of 2005.

"Genentech has reached its half-year mark with another set of excellent results," Genentech CEO Arthur Levinson said in a statement.

Ahead of the income report, Genentech shares rose 33 cents to close at $84.06 Tuesday on the New York Stock Exchange. The stock lost 2.9 percent, or $2.46, in aftermarket trading.

The biotechnology's profit soared behind sales of Avastin, its colon cancer treatment that is also effective in treating the eye disorder macular degeneration. Avastin sales in the United States increased 72 percent to $423 million, from $246 million in the second quarter of 2005.

The Food and Drug Administration approved the drug in 2004 for use by the sickest colon cancer patients. But a number of recent scientific studies show it's likely to combat several other forms of cancer, including cancers of the lung and breast.

Avastin is designed to choke the blood supply that feeds tumors and is the first drug of its kind to be approved by the FDA. When used with chemotherapy, it extends the life of the sickest patients by an average of about five months.

Analysts expect the drug, which costs each patient about $4,400 per month, to surpass $2 billion in annual sales by 2007.

The company's stable of other drugs also reported strong sales for the second quarter.

U.S. sales of its flagship product, the non-Hodgkin's lymphoma drug Rituxan, increased 17 percent to $526 million, from $450 million in the second quarter of 2005.

Sales of it breast cancer drug, Herceptin, jumped 111 percent to $320 million, from $152 million in the second quarter of 2005.

The company also in the second quarter received Food and Drug Administration approval for Lucentis, which also treats macular degeneration. The drug rang up $10 million in sales for the quarter.

Genentech reported U.S. product sales increased 41 percent to $1.7 billion from $1.2 billion in the second quarter of 2005.

Genentech profit rises on cancer drug sales
Tue Jul 11, 2006 4:58 PM ET

July 11 - Genentech Inc. (Nasdaq DNA) on Tuesday reported higher second-quarter profit on strong sales of colon cancer drug Avastin and its other cancer medicines.

The world's second-biggest biotechnology company, which late last month won U.S. approval for a new treatment for the leading cause of blindness in the elderly, posted a net profit of $531 million, or 49 cents per share, compared with a profit of $296.2, or 27 cents per share, a year ago.

Genentech shares have fallen about 9 percent for the year, lagging behind the American Stock Exchange Biotech Index (BTK), which is off about 5 percent.

Merriman Initiates Coverage of Cephalon, Sees Long-Term Strength but Short-Term Volatility

NEW YORK -- Merriman Curhan Ford & Co. initiated coverage of Cephalon Inc. Monday, predicting the company will perform well in the long-term due to new products. But analyst E. Russell McAllister said he sees short-term volatility as the pharmaceutical maker transitions patients to the second-generation drugs.

McAllister set a "Neutral" rating on the Frazer, Penn.-based company's shares in a client note.

The analyst said Cephalon's new medicines include Nuvigil, which treats excessive sleepiness, cancer-related pain reliever Fentora, and Sparlon for attention deficit/hyperactivity disorder. These medications are expected to produce $1.5 billion revenue for 2006, wrote McAllister.

"We believe these products represent meaningful long-term growth opportunities for Cephalon," he wrote.

McAllister also predicted prescription growth for Vivitrol, an alcohol dependence treatment that received regulatory approval in April.

The analyst noted that Cephalon faces "significant" competition, and could face difficulties in transitioning patients to its new drugs.

Shares closed the Monday Nasdaq session at $62.96

Cephalon (CEPH) and Alkermes (ALKS) rose early Monday after research firm Merriman Curhan Ford initiated coverage of the companies.

Shares of Cephalon, a Frazer, Pa., drug developer, were lately up 23 cents, or 0.4%, at $63.82, but have traded close to $65. Merriman health care analyst E. Russell McAllister said he expects the volatility Cephalon has seen thus far in 2006 to continue through the end of the year.

Still, while he advises investors to remain cautious about the stock and says near-term risks remain high, he has optimistic long-term expectations. McAllister gives Cephalon shares a neutral rating.

Meanwhile, Alkermes, a maker of drug-delivery devices, was gaining 15 cents, or 0.8%, to $18.32. Based on the recent approval of Vivitrol, a treatment for alcohol dependence, "we believe Alkermes has demonstrated substantial development expertise and we are optimistic that one or more of Alkermes' products, supported by partnerships with industry leaders such as Cephalon, Eli Lilly (LLY) and [Johnson & Johnson ] will achieve blockbuster status," McAllister wrote in a research report Monday. He rates the stock a buy.

LifePoint Hospitals (LPNT) confirmed its second-quarter earnings guidance of 50 cents to 54 cents a share Monday, sending its stock 2.5% higher to $33.42.

Irish drug maker Pinewood Laboratories is getting closer to a deal to be acquired by one of its numerous suitors, including generic drugmakers Teva Pharmaceutical Industries (TEVA) and Barr Pharmaceuticals (BRL) , according to a recent report in The Times of London. Teva's shares rose 1% to $32.38, and Barr's shares were up 0.2% to $46.81 following the report.

Final bids to acquire Pinewood, one of Ireland's top generic-drug firms, are expected to be submitted this week. The company holds the rights to manufacture more than 200 prescription and over-the-counter drugs, according to The Times.

Shares of managed care company QMed (QMED) fell 4.4% to $3.48 following a downgrade of the stock to a hold rating. Stifel Nicolaus analyst Thomas Carroll said the company's expenses are likely to increase, its disease management business "shows no promise" and "the shares have little ability to appreciate in 2006."

Other health stocks on the move included Novogen (NVGN) , up 5.2% to $12.79, and drugmaker Biogen Idec (BIIB) up 1.2% to $46.19. Biotech giant Amgen (AMGN) gained 0.7% to $66.87 and heart-device maker St. Jude Medical (STJ) rose 1.2% to $34.01.

Piper Jaffray analyst Thomas Wei said the recent FDA approval of Genentech's new drug, Lucentis, could provide long-term upside to Genentech shares.

Lucentis is used to treat the so-called wet form of age-related macular degeneration, or wet AMD, a leading cause of blindness in people over 55.

Genentech (nyse: DNA ) trials showed that 95% of the patients who used the drug maintained their vision, while up to 40% saw their vision improve after one year of treatment.

Management announced the wholesale acquisition cost for a vial of Lucentis will be $1,950.

Given that the average patient will receive five to seven injections of Lucentis a year to treat their wet AMD, Wei estimated the yearly cost per patient will be around $11,700.

That is a 20% to 60% premium to the cost of other currently available AMD treatments like Macugen from Pfizer (nyse: PFE - news - people ) and Visudyne from Novartis (nyse: NVS - news - people ).

As a result, Wei raised his 2006 earnings estimate on Genentech to $1.95 from $1.92 per share. He also raised his 2007 estimate to $2.42 from $2.41.

The analyst maintained an "outperform" rating and $120 price target on Genentech shares.

The president of research and development at biotech giant MedImmune has resigned from the board of Iomai, a much smaller biotech company that went public in February.

Jim Young, who joined the board in 2002, resigned July 5 because of his duties at MedImmune (NASDAQ: MEDI) and not because of any disagreement with Iomai, the company says in a Securities and Exchange Commission filing.


Young served as a member of the Iomai board's compensation committee and corporate governance committee.

Iomai President and CEO Stan Erck says Young was a major contributor to the company, a maker of patch-based vaccines for flu and other infectious diseases. Iomai (NASDAQ: IOMI) raised about $31 million when it went public.

The board has elected someone familiar with the local biotech scene to fill its empty seat.

Replacing Young is Thomas Vernon, previously a vice president at Merck (NYSE: MRK) and more recently a consultant to MedImmune, Gaithersburg-based diagnostics company Digene (NASDAQ: DIGE) and another large biotech company, Chiron of Emeryville, Calif., which has been acquired by Novartis (NYSE: NVS).

Iomai's board approved an increase in its size, to seven members. It elected a new director, Weller Meyer, who is chairman, president and CEO of Acacia Federal Savings Bank in Falls Church.

Indevus Says Second Sanctura XR Study Confirms Effectiveness Shown in Earlier Trial

LEXINGTON, Mass. -- Indevus Pharmaceuticals Inc. said Friday that a second late-stage clinical trial for its extended-release overactive bladder treatment, Sanctura, backs efficacy data from an earlier study.

Shares of Indevus rose 34 cents, or 6.1 percent, to $5.90 in premarket activity on the INET electronic exchange.

The company said a second Phase III trial showed that Sanctura XR reduced the average number of incidents of patients urinating before being able to reach a restroom by 83 percent, compared with a 52 percent reduction in patients given placebo.

At 12 weeks, Sanctura XR patients went to the bathroom an average 2.5 fewer times per day, compared with 1.8 fewer times per day in the placebo group. Results were statistically significant.

The study enrolled 564 patients at 62 clinical sites, with 280 patients given Sanctura XR and 284 patients given placebo.

In mid-June, the company released similar results from another Phase III study. Indevus plans to file an application with the Food and Drug Administration by the end of the year.

Genentech (DNA) slipped Friday even after research firm Friedman Billings Ramsey raised its second-quarter earnings estimate for the company to 51 cents a share, 4 cents above Wall Street's consensus target. The firm also raised its sales estimates for Genentech's cancer drugs Avastin and Herceptin, and its lymphoma and rheumatoid arthritis drug Rituxan. Shares of Genentech were down 72 cents, or 0.8%, to $84.61.

Indevus Pharmaceuticals' (IDEV) shares rose following the company's positive results from a late-stage study of its drug Sanctura XR, a treatment for people with an overactive bladder. The trial met the primary endpoint of reducing patients' frequency of urination and the secondary goals of increasing void volume and lowering the severity of urgency.

Results of the phase III study, the stage of studies conducted just prior to a drug's submission for Food and Drug Administration approval, confirmed the results of a previous trial announced last month. Indevus shares rose 9 cents, or 1.6%, to $5.65.

Shares of diagnostic-imaging services provider Radiologix (RGX) soared Friday on news it plans to be acquired by Primedex Health Systems (PMDX) for about $208 million, including net debt. The deal will create the largest owner and operator of diagnostic-imaging centers in the U.S., with 132 locations, according to Primedex.

Palomar Medical Technologies (PMTI) advanced $2.27, or 4.9%, to $49.11 after Standard & Poor's said it was adding the company to its Small Cap 600, replacing medical-laser developer Laserscope (LSCP) , which is being acquired. The switch is expected to happen after the close of trading on July 12.

Shares of German pharmaceuticals giant Bayer (BAY) were up 2.5% to $46.28 following an announcement Thursday that its diabetes-care division has acquired privately held Metrika, a maker of diabetes-monitoring devices.

PDL BioPharma (PDLI) tacked on 5 cents to $18.70 Friday, after falling early in the day. After the close of regular trading hours Thursday, the company said it plans to move its corporate headquarters to Redwood City, Calif., from Fremont, Calif.

Escalon Medical's (ESMC) shares jumped in early trading before settling back and closing 3 cents lower at $5.05. After Thursday's market close, the company said it has named former accounting firm manager Robert O'Connor as its chief financial officer.

Nektar Therapeutics (NKTR) settled a lawsuit brought by the University of Alabama in Huntsville regarding the company's PEGylation patent portfolio. The $25 million settlement includes a joint upfront payment by the company and its founder and former UAH employee Dr. Milton Harris. The remainder of the settlement consists of annual payments of $1 million for the next 10 years.

According to the company, as a part of the agreement, Nektar will dismiss all counterclaims related to the patent dispute. Nektar's shares fell 38 cents, or 2.2%, to $17.19.

Other health-care stocks on the move included Vertex Pharmaceuticals (VRTX) , 1.3% lower to $35.91, and Celsion (CLN) which fell 4% to $2.40. Tiens Biotech Group USA (TBV) lost 4.8% to $3.80, and Novogen (NVGN) dropped 7.2% to $12.16.

Drug Company 2Q Profits Seen Modestly Higher on Cost Cuts

PHILADELPHIA -- Major U.S. pharmaceutical companies are expected to post modestly higher sales and operating earnings for the second quarter, helped by cost cuts and new products.

However, several companies face continued pressure from generic competition for best-selling drugs.

The largest biotechnology companies, meanwhile, should report healthier earnings growth on sales of pricey cancer-related drugs.

Analysts estimate several large generic-drug companies had profit declines or limited earnings growth in the last quarter because of intense price competition.

For a few big makers of branded drugs, the quarter that ended June 30 was the last in which they could command high prices for three drugs that have generated billions of dollars in sales during the years. Patents expired for two cholesterol-lowering pills from Bristol-Myers Squibb Co. and Merck & Co., as well as for Pfizer Inc.'s Zoloft antidepressant. Each had sales exceeding $2 billion last year.

The patent expirations have cleared the way for cheaper, generic versions of the medications. Sales generated by the branded versions are expected to drop dramatically. The branded-drug companies remain hard-pressed to generate enough revenue from new products to replace the lost revenue from patent expirations in the near term.

What's more, the patent expiration for Merck's Zocor cholesterol-lowering pill has had a ripple effect across the industry. For instance, drug-benefit plans have switched members from Pfizer's Lipitor cholesterol pill, which still has patent protection, to Zocor in anticipation of the generic version.

The switching has made it difficult for Pfizer, the biggest drug company by sales, to sustain the growth rate for Lipitor, which nonetheless remains by far the best-selling drug in the world. First-quarter Lipitor sales were weaker than expected, and all eyes will be on Pfizer's second-quarter figures to see if the trend continued.

"An aggressive cost-cutting plan lends some consolation on near-term" earnings at Pfizer, "but longer-term growth will clearly rely on Lipitor's franchise value in the intermediate term and new drug successes," Deutsche Bank analyst Barbara Ryan wrote in a recent research note.

Ryan doesn't own Pfizer shares. Deutsche Bank or its affiliates, or both, own at least 1 percent of Pfizer shares. The firm has received investment-banking compensation from Pfizer in the past year.

Pfizer and other drug makers have trimmed their sales forces and taken other steps to cut costs. But many investors also want to see the companies invest in drug development and product launches so that the companies return to meaningful revenue growth.

Toward that end, the industry recently has won regulatory approval for several new products that could become blockbusters, including Merck's Gardasil -- a vaccine designed to prevent the virus that causes cervical cancer -- and Genentech Inc.'s Lucentis to treat a form of eye disease.

Still, approvals for some drugs are hard to come by in the wake of Merck's 2004 withdrawal of the painkiller Vioxx because of safety concerns. Drug companies say the U.S. Food and Drug Administration has tightened its scrutiny of new drug applications, leading to delays or outright rejections. Bristol-Myers, for example, recently scrapped plans to continue developing a diabetes drug after the FDA last year requested additional data about its cardiovascular risks, which would have required additional studies.

Most biotech companies are losing money as they develop products. But some big biotechs are expected to post earnings gains for the second quarter. Genentech, which is majority-owned by Roche Holding AG of Switzerland, is expected to benefit from brisk sales of cancer treatments Avastin, Rituxan and Herceptin, while analysts expect more modest growth at Amgen Inc., which sells Aranesp to treat anemia in cancer and kidney-dialysis patients.

Although generic-drug companies are aggressive in challenging patents and selling copycat versions when patents expire, intense price competition is limiting profit growth at several companies. Watson Pharmaceuticals Inc., for instance, is expected to post a decline in earnings, excluding one-time items.

One notable exception is the biggest generic company, Teva Pharmaceutical Industries Ltd., an Israeli company with sizable U.S. operations. Teva recently bolstered its product line by acquiring another U.S. generic company, Ivax. It also is selling or plans to sell the generic versions of the three big blockbusters that have lost patent protection in recent months: Pravachol, Zocor and Zoloft.

Company/Thomson Financial Estimate/Last Year's Net/Reporting Date

Genentech Inc. 47c 27c July 11

Johnson & Johnson 97c 89c July 18

Abbott Laboratories 57c 56c July 19

Pfizer Inc. 48c 47c July 20

Wyeth 75c 72c July 20

Eli Lilly & Co. 75c (23c) July 21

Merck & Co. 65c 33c July 24

Schering-Plough Corp. 17c (5c) July 24

Bristol-Myers Squibb 31c 50c July 27

Amgen Inc. 94c 82c N/A