Hey guys! Forget pure technical analysis when it comes to biotechs- Here is the REAL REASON that IDEC is going to go up- Lehman Brothers reports that sales of their lead product so far are at the high end of expectations and have raised their earnings estimate from 26 cents to fifty cents, and target price of the stock to 59 dollars. You can take a look for yourself- just find the Lehman Brothers biotechnology web site. Lehman reports "significant off label use" of Rituxan.
IDEC has been planning a new mfg facility for a couple years now. At one point they were considering 4-5 sites, including Texas and North Carolina, as well as San Diego. I think they have strongly preferred SD all along, but the community will have to be competitive. The facility will cost on the order of $200,000,000, essentially duplicating the Genentech Vacaville facility. I believe it will be used for pipeline products and for contract manufacturing. This will expand their mfg. capacity 10-100x.
IDEC most likely will build a manufacturing plant south of San Diego(Chula Vista area?). There are numerous Bio Tech companies located in the San Diego region. The city will likely negotiate to keep them. IDEC had been building Rituxan inventory at its Torreyanna Rd. facility prior to approval, and must continue to use that facility to meet demand for Rituxan sales. IDEC is bound by an agreement with GNE to produce Rituxan for at least 2 years from approval. ( In house production facilities and technical knowledge is a big plus for IDEC ) GNE is currently building manufacturing facilities in Vacaville which when approved for use will likely supply Rituxan. Probably 12-18 months from being on line. Additional production capacity at an alternate IDEC sight will likely supply Y2B8 which the company now has exclusive rights, as well as their pipeline.