Stock Commentary - Europe - week to Mar 16, 2009

EUROPEAN: bourses went into overdrive on the first day of the reporting period to March 16, helped by an upturn in the banking sector, although  drug majors were largely side-lined in this burst of activity. They then  proceeded to gain further, with several of the major markets up in  double digits week-on-week, and Big Pharma ending mixed, albeit  advancing. A 9.5% gain in FRANKFURT's Xetra Dax was more than either  Bayer, up 3.5%, or Merck KGaA, 8.8% higher, could manage. The former  plunged 10% on the day after the period covered, on worries about a US  Food and Drug Administration review of its anticoagulant Xarelto  (rivaroxaban; see page 22). Evotec succumbed to profit-taking, after  rocketing more than 41% the previous week on news of an up to $300.0  million deal with Swiss drug major Roche (Marketletter March 16). The  stock was off 7%. Stada Arzneimittel reversed its recent weeks declines,  leaping 19.8% higher, despite the predominantly generic drugs firm's  recent forecast of a decrease in sales and earnings for 2009 compared  with its performance in 2008. ZURICH saw a 10.7% gain for drug major  Roche, following eventual deal to take full control of majority-owned US  biotechnology firm Genentech (Marketletter March 16).

LONDON: drug shares were mixed. GW Pharma's 67.5% leap was due to the  company reporting positive data from a third Phase III trials of its  cannabis-based spray product Sativex in multiple sclerosis spasticity  (see page 21). AstraZeneca rose 10.3%, helped by presentations of strong  data at medical conferences on its breast cancer drug Arimidex  (anastrozole; page 18) and asthma agent Symbicort (budesonide and  formoterol; page 23).