Stock Commentary - New York week to March 23, 2009

NEW YORK: equities moved up and down in the reporting period to March 23, seeing a strong rally at the start on better-than-expected housing  data, and finishing the week on a high, rising 6.8% on the release of  new Treasury Secretary Tim Geithner's plan to move "toxic assets" - now  being described with the less frightening term "legacy assets" from  banks' balance sheets. The Dow Jones ended the period 7.7% higher,  taking most of the drug/biotechnology stocks with it; of those tracked,  32 rose and just four declined.

After Vivus told those at a health care conference about positive trial  data on Qnexa (phentermine plus topamax), the company's shares shot up  32% for the week. The obesity treatment showed a better-than-expected  effect on blood pressure, it was noted. Mark Robins of the Robins  Group raised his rating on the stock to strong buy from buy on the news,  while Adam Cutler of Canaccord Adams noted that the shares have been  undervalued.  Vivus expects the results of two large Qnexa Phase III  trials mid-year and plans to file a New Drug Application for the product  before the end of the year. Several analysts also feel that good news on  this drug could lead to a major licensing deal or acquisition for the  company. Strong data about Seattle Genetics' SGN-35 reported at the  American Society of Hematology meeting has been fueling the stock since  December. Investors are eagerly waiting for more news to come out at the  American Society of Clinical Oncology meeting in late May and early  June. Seattle Genetics saw its shares move up 14.8% during its first  week as part of the stocks followed by the Marketletter. Affymetrix  shares jumped 26.3%, having changed its direction lately, with some  investors deciding that the company might be acquired. There is also the  promise of more money for research coming from the Obama stimulus  package, with billions to fund medical studies and upgrade research  facilities. Noting that Effient (prasugrel) will get broad approval from  the Food and Drug Administration, John Boris of Citi Investment Research  has upgraded his rating on Eli Lilly to buy from hold, and increased his  target price to $41 per share from $36. Lilly's stock advanced 10.6%  over the week.