Ebb & Flow

The European biotech sector has trended down since the beginning of the year, despite a short runup in the first three weeks. In Continental Europe, the BioCentury Europe index is now down 10% from Dec. 31. And the London group, which began to recover in February, last week took a 4.7% hit and is now down 7% year to date (see "European Biotech Still Digging").

"In the last weeks the European economies have begun to look worse than expected, which is pulling the markets down in general," said June Scott, director of Sagitta Asset Management. "And in a bear market, no low is low enough."

Scott expects the markets to find a floor at the end of March, after which they should trade up slightly throughout the rest of the year, mainly based on valuation. "We are starting to see some real bargains," she said.

As a sign of the times, in Germany drug discovery service company Evotec (FSE:EVT) last week was off E0.24 (14%) to E1.51 and a market cap of E54 million ($58 million). Cancer play MediGene (NMarkt:MDG) fell E0.58 (16%) to E3.07 and a market cap of E34 million ($37 million) and Austrian neurological company Sanochemia (NMarkt:SAC) dropped E0.56 (20%) to E2.19 and a market cap ofE22 million ($24 million).

Those searching for a ray of sunshine perhaps could point to the fact that Celltech (LSE:CCH; CLL) had put in a bid for Oxford GlycoSciences (LSE:OGS; OGSI), meaning that at least some biotech assets are attracting multiple suitors. Moreover, CCH is offering cold hard cash for OGS's assets, counter to the previous stock bid by Cambridge Antibody (LSE:CAT; CATG) (see Ebb & Flow Focus, A20).


The Continent's malaise isn't helped by investors who continue to leave NicOx (NM:Nicox). The stock closed down E0.07 to E1.71 on the week following its 83% plunge the previous week. Investors

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