E Cassandra Is Silent

The dividend was raised 5% to euros 8/share. While AZSEY pulled out of investing in coal mines it indicated today that it will not stop insuring them. The theroy is that coal mining triggers global warming which causes the natural disasters, but of course it hasn't been proven.

After Thursday's note about the exit of Scottish Widows funds from Standard Life Aberdeen, I sold half my holdings at $20.43. It was after the blog came out but a second before the market closed. AZSEY sold its Taiwan and Korea asset management arms to SLFPY. Naturally it rose a few ticks today to $20.84.

Drugs

In the wake of the move into Teva by Warren Buffett's Berkshire Hathaway, the troubled Israeli drug firm has gained another 1.4% Friday. It is time to take some money off the table, so sell half at $21.5 double its 52-week low. Mr. Buffett will only have to tell the world if he sells it 45 days after the next quarter, about April 15 under SEC rules. This is an extremely volatile stock.

Novartis is reportedly planning to sell its US generics business, because of price erosion, rather than spinning Sandoz off to shareholders as former CEO Joe Jimenez said last year. This is another reason to worry about generics.

Here is what to do with the money, another biotech pick from Martin Ferera along with commentary from our biotech maven and a Canada broker. This is a speculative stock:

NYSE-listed Zymeworks (ZYME) which listed last year is HQ'd in Vancouver (BC) and run by Ali Tehrani, who set out to create a rational drug development company more than 15 years ago. His start-up won finance from venture capitalists for his drug testing platform which combines computer simulation with a way to engineer protein molecules before the start of costly clinical trials. I invested in ZYME personally as a very small angel.

Even before it was listed deals were signed with drug majors: GlaxoSmithKline, Merck & Co, Ely Lilly, CelgeneJust what they were buying into is hard to know because the contracts were secret, but it is important to note that the intellectual property was ring-fenced and the deals covered very specific research. This gives ZYME cash up front and future milestones, but the deals make it clear that Zyme owns the research and it is a hard-headed negotiator, not willing to give the shop away to continue to do deals.

The majors don't throw their money around without considerable due diligence. ZYME recently hired as CMO a specialist in breast cancer at her former job with Cascadian Therapeutics, Diane Hausman.

There is also research Zyme is doing itself. One of its drug candidates is ZW25, an engineered bi-specific antibody to treat HER-2 negative breast cancer which has not responded to other treatments. A natural antibody is a molecule with two arms, whereas an engineered one has different molecules which make it more able to get past the defenses cancer uses when it takes over a patient's cells. This one is in phase II trials.

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