I don't see any reason to be so downhearted. At the moment, the Nov85 calls are going for 4.20. In effect, you're paying 89.20 for the stock in November. Seems possible. As for "98% institutional" ownership, that's a myth. Unless you actually hold the physical stock certificates, which almost no one does, your shares are listed as held by an institution. (e.g. All of my shares are listed as held by Schwab, therefore an institution.) If I were playing options - which I'm not - I think I would take a flier on the July85 calls. They are selling for about half a buck now, but if they push this thing to 82.50 over the next week, they could double. (They're up 25% today.) The point would be to cash them in several days before expiration.
The noise is just noise. You should note that since the original Waxman letter was publicized on March 21, this stock is up more than 10 points. As is the stock of CELG, MDVN, and many other makers of ultrapricey drugs.
Pushing it up above 82 briefly to put the July82.50 calls into play, then retreating to the 81.50 level, which looks like support now. I still think that they will take it above 82.50 before earnings to sell the 85's.
The strange thing in this case was that I attempted to post this message three times over a period of 18 hours, rewriting the post each time in case I had inadvertently violated some taboo. Each time, the message was deleted. Other messages on other boards posted as usual.
On the other hand, the last time you posted this nonsense, on May 13, the stock was at 66.
Note III: Medivation (Xtandi @ $85,000 per year) from 66 to 77. I could go on, but I feel like I'm slipping notes through the bars to evade the guards.
Note II: JNJ (Janssen's Doxil @ $24,000 per infusion, Imbruvica @ $130,000 a year, Zytiga @ $60,000 per year, etc.) from 95 to 105.
I have attempted 3 times to post what seems to me a fairly innocuous message citing the fact that since the brouhaha about drug price controls was ignited, the stock of companies with pricey drugs have been advancing strongly. Yahoo! has deleted these posts each time. Has Yahoo! forbidden posts which include the names of other companies here? This would preclude, for example, the discussion of competitors, suppliers, or, in this case, analogous companies. (Note that I am avoiding the mention of specific companies.) If so, this seems abysmally stupid.
PS It's even less excusable on my part since I'm a Californian. Perhaps it's attributable to how invisible our senators, Dianne Feinstein and Barbara Boxer, have become.
Interesting that the author made the same mistake I did in yesterday's post and referred to him as "Senator Waxman" when he is just a lowly lame duck representative.
Nah. Basically everyone in the developed world who needs Gilead's HIV drugs gets them, whether they are paid for by private insurers or government health plans. The same will be true with the HCV drug. The bargain which everyone signs onto - much as with education - is that the more affluent (or their insurers) pay high prices so that the product can be made available to the needy at much lower prices. If you complain to Harvard about the high cost of tuition, the answer is the same as if you complain to a drug company about the high price of their products; "Oh - you can't afford it. In that case, it's free." Seems strange, but that's the way we do it.
Correction: Waxman is not a lame duck Senator, but a lame duck Representative, which makes his protestations even less important.
PS and correction: Besides the soon-to-be-retired Representative Henry Waxman (whom I erroneously referred to as a senator), the only other committee member to sign the new letter is Diana deGette, from Colorado's 1'st District. This district has gone Democratic for all but 6 years since 1933. During the last election, running against a Republican, a Libertarian, and a Green Party candidate, deGette polled 68.3% of the vote. I'd say she is risking little by complaining about high drug prices.
Has it escaped your notice that no one in Congress - or the executive branch, for that matter - paid any attention to the first letter? With midterm elections coming up, do you really think that any of these stalwarts of either party wants to pick a fight with big pharma?
Inspired by the fearless Senator Waxman, I will go out on a limb and predict that this will close at 80 tomorrow. If I played options - which I don't - I would consider going into the July 82.50 calls ... or, if those were pricey, even the July 85's. With the earnings expectations high, I think the large holders will be nudging the price upwards to sell these things. If they move into the money, obviously the time to unload them would be two or three days before expiration.
Apparently not satisfied with the press coverage he garnered by his earlier demand that Gilead explain Sovaldi's pricing, Senator Waxman has pronounced himself not satisfied with their explanation. When he sent his first letter back in March, Waxman was joined by only two of his fellow Democratic committee members, one of whom, Pallone of N.J., was his expected successor as ranking member. Pallone, who comes from a state which is home to JNJ, Merck, and several other major pharmas, has apparently rethought his position and not signed this new letter. What foolhardy courage motivates Waxman to press on with the fight? Perhaps the fact that he has announced his retirement is a factor. I suspect that when we next hear from him, he will be a highly paid lobbyist for the healthcare industry, a position for which he is now honing his cv. (We can worry about federal price controls on drugs when more than one of Waxman's fellow Democratic committee members - or a single one of the Republican members - joins him.) Incidentally, Waxman surely; knows the reason behind high prices for exotic drugs: The Orphan Drug Act, of which he was the principal author. By establishing extended patent rights and offering federal funding and big R&D tax breaks, and most of all, by essentially guaranteeing that successful drugs would be very profitable, the ODA underpinned this entire industry. The fault, dear Henry, is not in the stars, but in ourselves that we are underlings. To anyone with a few million bucks in campaign contributions. This is not intended as a partisan post, but merely an observation on the pusillanimity of all politicians.
A theoretically possible story, but unlikely. First of all, GILD was not selling for $5 a share in January of 2001 - it was selling for about $70. (Actually as low as 50 and as high as 83). Since January of 2001, stock splits indeed have turned one share into 32 shares, a fact which no doubt captured this fantasist's imagination.
Exactly right. The June45 calls were the only option really in play here, and they are washing out.
No, you had your chance to cash in those puts, but, like most amateurs, you stayed at the party too long and lost your money.