E Bull In A China Bourse

Moreover it will join another blockbuster inoculation GSK bought from Novartis last year, Bexsero against meningitis B, for which another $1 bn in sales are forecast by Evaluate. It is selling like topsy thanks to GSK making a deal on price for British inoculation with the National Health Service, so much so that demand rose so high there was no Bexsero available for private clinics.

GSK is now building a new $175 mn plant in Germany where it will move production of 3 of the 4 active components of Bexsero which it is now buying from Sandoz, a NVS sub in which Roche owns a stake.

*The Roche cobas® 4800 cytomegalovirus (CMV) test for stem cell transplant patients is now available in countries recognizing the RHHBY rights. The molcular diagnostic array produces a quick result showing infection in transplant patient viral load. Roche also has viral load tests on the market for HIV-1, hepatitis C and B, and Hep C genotyping. The 4800 uses automated nucleic acid purification and polyerase chain reach amplification to detect these diseases and other less well known ones. In cases of transplant, donated organs and cells can transmit or reactivate CMV which can cause major damage to organs like lungs, liver, kidneys, intestinal tract, eyes, etc. About 40-100 of adultes are infected with CMV depending on regions and they have no symptoms—but their transplant recipients are very vulnerable. RHHBY is a major player in diagnostics.

*More on the new ADHD drug from Shire (SHPG), Mydayis. It uses Allderall tech but combines several variant components to achieve more lasting control of the problem, vitiating the need for interim dosage during a day. The FDA approval took 9 years and 16 clinical trials, so it really is a victory for the Irish drug-maker SHPG. The potential sales are put by Shire at $500 mn/yr but not all broker analysts agree, except for Jefferies' David Steinberg. He told Fiercepharma blog that Shire may surprise the market with high sales.

Separately, SHPG won European Medicine Agency approval for its Veyvondi treatment for bleeding episodes and peri-operative bleeding in adults, already on the market in the USA.

*Zacks upgraded Novo Nordisk (NVO) from hold to buy; the Chicago stock rater uses charts for forecasting. NVO is upwardly mobile.

*Société Générale downrated Reckitt-Benckiser (RBGLY) to hold from buy; we told you first. RBGLY is being penalized now not for its emerging market sales (which are now a source of optimism) but for its basic business of selling household products and nostrums to Britons who are spending much less than before the Brexit vote and the ensuing political uncertainty.

Capital Raising and Rising

*Naspers (NPSNYvia its Myriad International sub is exploring the issue of a US$ bond to raise money to repay existing debt and for general purposes. The South African media group is a large holder of Hong Kong's Tencent (TCTZF). Earlier this month Naspers forecast that its EPS in the FY to March 2018 will rise 33-39% (in rands.) How much it proposes to raise is not yet known.  

*Depositary Bank of New York-Mellon has registered with the SEC to issue up to a billion new ADRs for Banco Santander (SAN). SAN has long been more widely traded in the UK and the US than in Spain, but there may also be a capital increase in its homeland.

*While I shyed away from buying Barclays (BCSafter its brass was charged with fraud and self-dealing in Britain, the Investors Chronicle today chose to buy BCS common. Its Emma Powell took a positive stance on the bank. I fear that there will be much more trouble over the refinancing in 2008 along with a pile of charges over forex and front-running already on the dockets in the USA. We remain positive on the preferreds from the UK bank because they more trouble it faces the longer they will not be redeemed. Why is former CEO Bob Diamond not among those charged in the UK? I cannot believe he didn't know about what his underlings were done in the Gulf.

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