Stock Commentary - New York week to July 7, 2008

NEW YORK: equities saw up and down movement during the holiday-shortened reporting period to July 7, which left the Dow Jones Industrial Average 1.0% lower overall. Crude oil prices continued to accelerate, hitting a new high of over $143 a barrel on July 2, which continued to impact investors' sentiment, although another month of negative employment data was shrugged off on July 3. Pharmaceutical and biotechnology stocks were mixed, with 17 of those tracked rising and 20 falling over the period.

Amgen and Vivus stocks were both up on positive news coming out of trials. Amgen's shares were buoyed 6.6% by new data showing motesanib slowed the progression of metastatic thyroid cancer. And new data from a Phase II study of Qnexa (phentermine-topiramate) helped to boost Vivus stock 11.7%. The earlier release of information in June had also pushed the stock up. Yaron Werber of Citi Investment Research feels higher prices for Avonex (interferon beta-1a) and Tysabri (natalizumab) could mean good news for Biogen Idec, up 5.3% on the week, through the end of the year, though it will not affect the current quarter, and, as long as the competition keeps raising prices, that for Avonex can be boosted. The company raised its prices following the June lead of Merck KGaA's and Rebif (interferon beta-1a). Mr Werber has a hold rating on the stock and a price target of $72. News of a law suit helped to hobble Affymetrix' stock during the reported period. Down 7% for the week, Affymetrix is being sued for patent infringement by MIT over the GeneChip system used to analyze genes. Affymetrix filed a patent application in September 2004, six months after a similar one was approved for MIT, according to the complaint, which added that the Patent Office ruled in May 2007 that the MIT group was the first inventor. Roopesh Patel of UB feels that the sales trends for Merck & Co's Gardasil (quadrivalent human papillomavirus) are not encouraging and second-quarter sales will barely surpass those of the first. He has downgraded the stock, too, though Merck feels sales should improve in the second. A CBS report about side effects for the vaccine did not help either, and with the downgrade coming on the last reported day, the stock fell 2.9%.