The JPMorgan health care conference hadn't even officially begun when the first big piece of news of the week hit: Irish drugmaker Shire said Sunday morning it's purchasing orphan-drug company NPS Pharmaceuticals for $5.2 billion.
Hours later, data from Alnylam Pharmaceuticals in hemophilia: in a very small, early-stage study, the drugmaker showed that its experimental therapy helped improve blood clotting, preventing the bleeding that characterizes the disease. Bristol-Myers announced a late-stage trial of its drug Opdivo was stopped early because it met the study goal: showing it helped lung cancer patients live longer than the comparator drug, the chemotherapy docetaxel.
Then, in the wee hours of Monday, another deal: Swiss drug giant Roche said it is buying a majority stake in diagnostics company Foundation Medicine, paying more than twice Foundation's stock price per share.
Just your typical kickoff to the year's biggest health-care investing event.
More than 400 companies will present this week to about 9,000 attendees at the JPMorgan conference. And after the tear biotech, in particular, has had—outperforming the Standard & Poor's 500 Index for five years straight—it's a key week for gauging sentiment about the sector for the rest of 2015.
The early pieces of news fall in step with the themes that drove biotech valuations last year: mergers and acquisitions, and excitement over medical advances (not to mention strong sales of marketed products, which we're likely to hear more about as companies make their presentations this week).
Let's start with Foundation Medicine: Roche is paying $50 a share to acquire 15.6 million shares of Foundation, for a total of about $780 million. Foundation's stock closed at $23.93 Friday. Roche also said it would invest an additional $250 million in Foundation by buying 5 million newly issued shares, also at $50 apiece. The deal gives Roche ownership of up to 56.3 percent in the diagnostics company.