Biotechnology shares finally gained ground Tuesday, boostedby a positive earnings report by Genzyme Corp. andanticipation of similar news from Amgen Inc., which wasreleased after the close of the market.
A recommendation by an FDA advisory committee foraccelerated approval of Hoffmann-La Roche Inc.'s AIDS drugddC based on surrogate markers also may have helped thesector, which has been awash in discouraging news from theregulatory front.
"People may even have done some buying of bargains," saidMontgomery Securities analyst Brandon Fradd.
The AMEX Biotechnology Index was up 5.70 to 140.26, its firstrise since April 9.
John Kaweske, who runs two health care funds, said that he isselectively buying biotech stocks, focusing on high-qualitynames with earnings, such as Amgen and Genzyme, or potentialblockbuster drugs, such as Synergen Inc. "I really welcometimes like this because it creates tremendous values that willlead to appreciation," he said. "It can be very difficult for theentire group, but an astute investor can find good names andget better than 25 percent."
Last year, the biotech exposure in his Financial Health SciencesPortolio was near 20 percent, before he cut it back to about 10percent. Now, said Kaweske, it's back up to 12 percent or 13percent.
The fund is down about 18 percent this year, and has lostabout $100 million in redemptions, a relatively small amountin Kaweske's opinion. The size of the fund is now $800 million.
Kaweske expects the sector to bottom for several months. "Inthe fall or early winter we'll see the origins of a rally," he said.
-- Karen Bernstein BioWorld Staff
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