Stock Commentary - Europe - week to Oct 6, 2008

EUROPEAN: bourses were nearly all significantly lower for another week, impacted by the turmoil in financial sectors during the reporting period to October 6. There were some ups and downs, but the market meltdown on the last day saw indexes post their largest one-day losses for 20 years. Two exceptions were Switzerland and BRUSSELS, where the BEL-20 dipped just 0.8%, but drugs firms Solvay and UCB underperformed, dropping 1.1% and 2.5%, respectively. FRANKFURT saw a 6.2% gain for MorphoSys, which was lifted by the news that Japan's Shionogi had extended a research partnership. Of the drug majors, Merck KGaA managed a 1.3% rise, while Bayer fell 5.2%, though still outperforming the Xetra Dax' 7.2% decline. Its fall came despite gaining European approval for its once-daily anticoagulant Xarelto (rivaroxaban; Marketletter October 6). In AMSTERDAM, there was a 7.9% drop in Crucell, even though the company received a $70.0-million US contract to develop vaccines for Ebola and Marburg viruses. Drug majors Roche and Novartis did better than the market in ZURICH, rising 1.4% and 3.3%, respectively, on no particular news.

LONDON: stocks were mixed, with drug majors AstraZeneca and GlaxoSmithKline barley changed. Little Alizyme plunged 25.4%, as a rumored takeover failed to materialize. SkyePharma gained 5.6%, after the firm negotiated new terms for convertible bonds (see page 28). Shire was down 4.2%, despite rising on the news that a non-executive director had purchased 15,000 American Depositary Receipts in the firm, which helped counter worries about its drug Vyvanse (lisdexamfetamine) missing sales targets.