Alexion stock climbs following earnings; Angiotech stock gives up almost 6% on 3Q earnings

By Sheri Kasprzak

New York, Nov. 1 - Even though third-quarter earnings sent a good number of biotech stocks down Wednesday, Alexion Pharmaceuticals, Inc. bucked the trend, posting a 3.24% gain on the day after releasing its earnings statement.

The company reported a net loss of $31.9 million for the quarter and revenues of $300,000, compared with a net loss of $36.6 million and revenues of $400,000 for the corresponding 2005 quarter.

After announcing its earnings in the morning, the company's stock climbed by $1.21, or 3.24%, to close at $38.57. The stock, however, gave up 6 cents in after-hours activity (Nasdaq: ALXN).

"I'd say most of us [investors] are probably cautiously optimistic [about Alexion]," said one buyside market source contacted Wednesday. "They have some decent products in their pipeline. Once they get pexelizumab through trials, I think their stock will really take off."

Even so, volume of Alexion's stock traded Wednesday took off with 1,195,206 shares traded, compared with the average 409,333 shares.

Alexion, located in Cheshire, Conn., develops treatments for cancer, autoimmune disorders and hematologic diseases.

Angiotech stock dips

Although Alexion's stock made it through its earnings announcement with a gain, Canadian biotech firm Angiotech Pharmaceuticals, Inc. wasn't quite so lucky. The company watched its stock drop by 5.8% on Wednesday after releasing its third-quarter earnings, reporting revenues of $86.3 million, derived mostly from royalties and medical product sales.

"Part of the problem is that they've dropped their guidance by a substantial amount," said one market source when asked about the drop in Angiotech's stock Wednesday. "That doesn't look good. Their earnings in general look fine, but no one wants to hear that you're probably bringing in $20 million less than originally thought [for the year]."

Angiotech said in its earnings report released Wednesday that it now expects total revenues for 2006 to be $302 million to $306 million, compared with previous estimates of $325 million to $335 million.

The stock gave up 55 cents on the day, or 5.8%, to settle at $8.95 (Nasdaq: ANPI) and lost another penny in after-hours trading. Volume also took off with 1,237,494 shares traded compared to the average 446,776 shares.

Angiotech, based in Vancouver, B.C., is a medical device company.

Avant slips on earnings

Elsewhere in earnings news, Avant Immunotherapeutics, Inc.'s stock dipped slightly after announcing it incurred a net loss of $5.2 million in the third quarter. The loss is wider than the $4.5 million net loss for the same 2005 quarter.

The company reported a net loss of $14.2 million for the nine months ended Sept. 30 compared with a net loss of $14.1 million for the same nine months of 2005.

The stock gave up 3 cents on the day, or 2.04%, to close at $1.44 (Nasdaq: AVAN). Volume was up with 546,442 shared traded compared with the average 178,042 shares.

The increase in the loss for the third quarter, the company said in a news release, is attributed to an increase in operating expenses offset in part by an increase in investment income. The decrease in revenue reflects lower billing levels of DynPort Vaccine Co. LLC for the anthrax/plague vaccine contract during the third quarter.

Based in Needham, Mass., Avant develops vaccine and therapeutics used to boost the human immune system.

OccuLogix revenues drop

OccuLogix, Inc.'s stock gave up 4.35% Wednesday after the company announced its net revenues for the third quarter were $85,444 compared with $632,330 for the third quarter of 2005.

The company's net loss for the quarter was $3.6 million compared with a net loss of $2.9 million for the same quarter of 2005.

The stock gave up 12 cents to end at C$2.64 (Toronto: OC).

Toronto-based OccuLogix develops laser and other treatments for glaucoma.

Electro-Optical's $13.18 million PIPE

Moving away from earnings news, Electro-Optical Sciences, Inc. is gearing up to wrap a $13,180,589 private placement of its stock.

The company is one of two medical device companies conducting a PIPE transaction Wednesday.

After news of the Electro-Optical offering was announced in the morning, the stock gained 14 cents, or 2.43%, to end at $5.90 (Nasdaq: MELA).

The company plans to sell 2,312,384 shares at $5.70 each. The price per share is only a slight premium to the company's $5.76 closing stock price on Tuesday.

The investors in the deal will also receive warrants for 346,858 shares, exercisable at $6.70 each for five years. The strike price of the warrants represents a 16.3% premium to the company's closing market price on Tuesday.

Jefferies & Co., Inc. was the placement agent.

Proceeds will be used for general corporate purposes.

Located in Irvington, N.Y., Electro-Optical is a medical device company focused on developing non-invasive, point-of-care instruments to diagnose melanoma.

PhotoMedex to raise $11.46 million

In another medical device offering, PhotoMedex, Inc. saw its stock slip after announcing its plans to settle an $11,466,000 stock offering.

The stock gave up 6.62%, or 9 cents, to close the day at $1.27 (Nasdaq: PHMD).

The company plans to issue 9.8 million shares at $1.17 each to institutional investors and warrants for 2.4 million shares. The warrants are exercisable at $1.60 each.

The offering is scheduled to close Thursday.

Cowen & Co., LLC was the placement agent.

Proceeds will be used for working capital.

"We now have the working capital to increase the size of our sales force and accelerate our launch of the XTRAC laser system," said Jeff O'Donnell, the company's chief executive officer, in a statement. "In addition, we plan on expanding our surgical services business to take advantage of a national laser services contract."

Based in Montgomeryville, Pa., PhotoMedex develops laser and fiber optic systems used to treat psoriasis, vitiligo, atopic dermatitis and leukoderma.

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