Most pharma companies focus on acquiring companies with promising pipeline candidates/technologies in their kitty, instead of developing a product from scratch, which involves a lot of funds and time.
Roche (RHHBY) recently announced it has agreed to acquire a privately-held Austrian biotechnology company named Dutalys GmbH.
As per the agreement, Roche will make an upfront cash payment of $133.7 million to its shareholders and make additional contingent milestone payments of up to $355 million based on the achievement of certain predetermined goals.
We note that Dutalys specializes in the discovery and development of fully human, bi-specific antibodies. The discovery and development is primarily based on their proprietary DutaMab technology.
The deal will further augment Roche’s efforts to develop bi-specific antibodies designed to provide novel, best-in-class molecules for several therapeutic areas.
Roche specializes in drugs for oncology, immunology and infectious diseases. Apart from providing therapeutic products and services for diverse medical needs, the company focuses on innovative diagnostic solutions for early detection and treatment of diseases.
We are encouraged by Roche’s performance in 2014. Its oncology portfolio looks solid as ever and we expect further traction. We are also impressed by the company's efforts to grow beyond oncology to immunology and ophthalmology. However, generic competition for Xeloda and Pegasys will negatively impact sales, going forward.
Roche currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the health care sector are Biogen Idec Inc. (BIIB), Allergan Inc. (AGN) and AbbVie Inc. (ABBV). While Biogen carries a Zacks Rank #1 (Strong Buy), Allergan and AbbVie hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment