Monday, April 3, 2000
Incyte (INCY) was whipsawed on Wednesday when Janus
Capital filed a registration statement covering the resale of 2 million shares.
The stock slid $20.813 (20 percent) to $82.50 on 3 million shares on the day
as market watchers extrapolated that Janus, which bought the shares in a February
private placement at $211 per share, had turned sour on the seller of genetic
databases and related tools. Not the case, according to Janus portfolio manager
Tom Malley. Malley told Ebb & Flow that the filing "has to do with getting
shares registered to remove the discount we book to account for the liquidity
risk," when Janus buys shares privately that aren't immediately tradable. "We're
happy with the Incyte investment, and we like the long-term story." The 2 million
shares represents a 6.3 percent stake in INCY, which closed Friday at $87.438,
down $19.937 (19 percent) on the week.
In a week when the BioCentury 100 index suffered its forth consecutive blow-off, Lynx (LYNX) threw in the towel on its 1.5 million share follow-on. The move was no surprise, as the genomics company had the misfortune of filing for the deal during the week that President Clinton and Prime Minister Tony Blair issued a statement that raw genomic data should be freely available, driving investors from genomics stocks. LYNX shed $19.75 to $46.25 on the day of filing, and had traded down to $27.938 prior to pulling the deal on Thursday.
By comparison, Regeneron (REGN) and Visible Genetics (VGIN) elected to go the full 12 rounds, and came out bruised and battered. REGN raised $77.4 million through the sale of 2.6 million shares at $29.75, leaving more than $120 million on the table, assuming it had sold the proposed 4 million shares at its price of $50.297 prior to filing. REGN, which is developing drugs for obesity, rheumatoid arthritis and other diseases, finished the week at $29.563, down $6.50 (18 percent).
Pharmacogenomics play VGIN raised $76 million through the sale of 2 million shares at $38, but would have raised $167 million had it sold the shares at its $83.50 price prior to filing. It finished Friday at $37, down $13 (26 percent) on the week.
LYNX closed Friday at $29.75, down $3.125 (10 percent) on the week. It had $30.8 million in cash at Dec. 31 and lost $6.7 million in 1999.