That Ranexa isn't such a big deal is exactly the reason why Gilead trades 12 points below last year's high. More precisely, it's part of the reason and Letairis is the other (bigger) part. Only blockbuster status for ambrisentan will convince me that the cardiovascular push was smart business. As for now I believe Gilead doubled down on a bad investment in Myogen when they bought CV.
Imagine what more than 4 billion could have done for the company had it been invested in HCV or cancer. Instead they dropped cancer. How can you drop cancer when you are so deeply involved with nucleoside chemistry? And I don't even want to think about how promise in cancer can move a stock. No wonder investors are running away.
This announcement clears the air - may have been the source of the long pps decline that The Street played. Now that it is out and understood, shares may rebound to next Fridays options levels. Monday will be rough but the recovery will be equally as rapid, IMHO.
Case in point, last weeks play on Genzyme shares which was haulted when the company detailed the problem on Monday and the charges that it would be taking.
The Market hates uncertainty, clarification is the best tonic.
At least for me, it doesn't help create certainty. I don't know why there was a subpeona. If there's litigation, that could be drawn out. If the press release said they had settled a suit for $1million, that would be clearing the air and clairifying. This appears to be a first step in what i hope is not a drawn out process.
So at this point, I am still uncertain/cautious UBadger