Quantcast
 
New book by Larry Connors Click here Improve your trading - See how


 

SurModics plunges as Merck ends deal

Fri. September 19, 2008; Posted: 08:40 PM
Stocks RSS
Sep 19, 2008 (Pioneer Press - McClatchy-Tribune News Service via COMTEX) -- MRK | Quote | Chart | News | PowerRating -- Sep. 19--Shares of Eden Prairie-based SurModics dropped more than 21 percent Thursday after pharmaceutical giant Merck & Co. discontinued a research collaboration on eye implants with the company.

The Merck agreement was key to diversification efforts at SurModics, which has generated much of its revenue over the years from making a polymer used on drug-coated stents for the heart artery -- a big but struggling market.

SurModics said after Wednesday's market close that a strategic review at Merck culminated in the decision to discontinue the collaboration agreement. First announced in June 2007, the deal included an upfront licensing fee of $20 million for SurModics and made the local company eligible for up to an additional $288 million in future payments.

The companies had planned to develop an implant that could deliver drugs directly to the eye for common ailments such as macular degeneration. But in August, signs of trouble emerged when Merck said it was suspending a clinical trial of the experimental device to evaluate the study's design.

Merck's decision was based not on concerns about the safety nor the effectiveness of the implant being developed, SurModics said.

"We understand and respect that our partners must undertake strategic reviews which on occasion result in a change of focus or even the discontinuation of projects," said SurModics CEO Bruce Barclay in a news release. He said the company continues to seek other partners for developing

eye implants.

Charlie Jones, an analyst with Barrington Research in Chicago, wrote in a note Thursday that he expected SurModics would make good on its pledge to forge other partnerships. But the collapse of the Merck agreement likely would delay any such announcement for at least 90 days, Jones wrote, when the Merck collaboration is legally terminated.

Merck's decision triggered an additional $9 million payment to SurModics. But that provided little solace to shareholders, as the stock closed Thursday down $8.39, at $30.72.

Christopher Snowbeck can be reached at 651-228-5479.

To see more of the Pioneer Press, or to subscribe to the newspaper, go to http://www.twincities.com. Copyright (c) 2008, Pioneer Press, St. Paul, Minn. Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

For full details on Merck & Co (MRK) click here. Merck & Co (MRK) has Short Term PowerRatings of 4. Details on Merck & Co (MRK) Short Term PowerRatings is available at This Link.

    


More News:   Market Updates | Stock Alerts | All Trading News | Stock Index

Email
Print
Archives
Feedback
Email Article Link
Close X
Recipients email address
Your name
Your email
Add a note (optional)




Stocks RSS





Related News [MRK]
PREMIER SPONSORED LINKS
TRADE CENTER
 
The TradingMarkets Directory
RELATED SITES
Nothing but forex
Please call 1-213-955-5858 ext. 1

About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback

Disclaimer:

The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.

It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.

HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.

The Connors Group, Inc.
15260 Ventura Blvd., Ste. 2200
Sherman Oaks, CA 91403

© Copyright 2009 The Connors Group, Inc.


All analyst commentary provided on TradingMarkets.com is provided for educational purposes only. The analysts and employees or affiliates of TradingMarkets.com may hold positions in the stocks or industries discussed here. This information is NOT a recommendation or solicitation to buy or sell any securities. Your use of this and all information contained on TradingMarkets.com is governed by the Terms and Conditions of Use. Please click the link to view those terms. Follow this link to read our Editorial Policy.

© 2009 The Connors Group, Inc.