Time for Onyx to do the acquiring - EXEL a great target
With a great move up in PPS, a growing income and a bursting war chest, it may be time for ONXX to think about filling its pipeline. Important competition in RCC and HCC may come from cabozantinib, owned by Exelixis (EXEL). Cabozantonib is a potent inhibitor of MET and VEGFR2 that looks good in both indications. Recent datas in advanced HCC (sorafenib treated and naive) were very encouraging. A host of other indications being explored, including prostate CA and bone mets in general. An FDA decision is expected in November for ph 3 medullary thyroid CA. Objective activity against breast and melanoma. Lots of partnered compounds too. I will be moving about half of my ONXX position to EXEL before November. Hoping for move up in EXEL pps or buyout. Any thoughts??
<Remeber, when it hit 46 you've sold portion of your position (don't know if you later bought it back)? Now is exactly the same situation and I'm giving it some time (buyout???), but eventually consider the same move...>
I sold 5% of my shares at that price, and the reason was two-fold. First, I had run up a bit of margin to buy ONXX and SNTA. Second, Kyropolis hadn't been approved, so I wanted to reduced my margin significantly. The situation with ONXX now is far different than when I sold my 5% of my shares.
I think the buy-out talk won't die out for some time. If Regorafenib is granted approval in November, the buy-out talk will surge, assuming of course that ONXX hasn't been bought before then.
Bio, in his last interview the CEO has saidd that the company developed carfi was on the same street the ONXX located, so it sounded like they did not look in particular for aqusition, just stamble upon one... So, if this is the way ONXX buy companies I seriously doubt they will buy EXEL. Frankly, I think they're sitting on their hand and waiting for the offer from Baayer or someone else. My problem with that that I think the fair price would be $85- which represent less than 10% premium, so offer must come around $90-$95 (I'd like to see how the price target of $110 (not talking about $125) was calculated. I don't believe in this price target. In my view if ONXX is not bought in the next couple weeks it will go on shopping spree- they're not going to wait a year as Dr Vin suggested,- simply because market always look for the next catalist and CEO understand this game to well. We all must realize that it is totally unclear how fast sales will rump up (maybe at CC some guidance will be provided)- on one hand there is 50k potential patients that can use drug right now. On another hand there are a lot of things that can go wrong- insurance reimbursement, manufacturing problems, doctors awareness/exeptance and so on and on. As investor I'm holding to my 17k shares and hoping for better, but in my view there is a risk that exitment will wear off and s/p will get lower...
Biopilgrim and I were discussion acquisition in the event ONXX doesn't get acquired itself. My point was that I doubt there would be very ugh enthusiasm by ONX or its shareholders for a major acquisition now. My one year time frame for reevaluating that position wasn't my estimate for how long Kyprolis would take to scale up. Rather it was to state that ONXX wouldn't realistically consider buying another company for quite some time. Anther factor making an acquisition far less likely is that while ONXX bought Proteolix to get Kyprolis, they still need to pay its shareholder milestones. Hence the need to build up a greater cash reserves.