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Drug Giant Looking At Several Acquisitions

Despite a terrible tape, the Biotech ETF closed higher after chatter suggested a major drug maker is looking to make at least one if not several acquisitions. What must you know?

According to published reports the board of French drugmaker Sanofi-Aventis talked about making several U.S. acquisitions when they met in Paris earlier this week; including one or two that could be worth at least $15 billion.

On the news shares of Biogen, Botox maker Allergan and Genzyme all shot higher.

Sanofi declined comment.

What’s must you know before you trade?

Biotech was hot on Friday because of this Sanofi story, says ISI Group biotech analyst Dr. Mark Schoenebaum.

Retail investors should know the sector has dramatically underperformed because of concerns drugs made by these companies are expensive.

I think it will be hard for biotech to get out of the funk, says Schoenebaum. However there’s no denying that the group is cheap.

If you want to take a stab at a cheap stock in the space, look at Celgene , adds Guy Adami.


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Trader disclosure: On July 2, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Terranova Owns (FCX), (MON), (AGU), (KO), (XOM), (TEVA), (RDS.A), (GMCR), (UPL), (GS); Terranova is short gold; Terranova owns (GLD) July 123 puts; Terranova owns (GS) JULY 130 CALLS; Terranova owns (GS) JULY 135 CALLS; Najarian Owns (PFE); Najarian Owns (CELG); Grasso owns (ASTM), (ABK), (BAC), (BGP), (C), (CSCO), (DYN), (JPM), (LPX), (MO), (NDAQ), (PFE), (PRST)

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