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Johnson & Johnson (JNJ), Rigel Pharmaceuticals, Inc. (RIGL): This Week in Biotech

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With the SPDR S&P Biotech Index up 22% over the trailing-12-month period, it’s evident that investment dollars are willingly flowing into the biotech sector. Keeping that in mind, let’s have a look at some of the rulings, studies, and companies that made waves in the sector last week.

It was most definitely a wild week for sure, with both positive and somewhat negative clinical stage data, an approval by the Food and Drug Administration, and buyout rumors circling one small-cap biotech.

Johnson & Johnson (NYSE:JNJ)

The week began on a high note after Johnson & Johnson (NYSE:JNJ) announced that its revolutionary Type 2 diabetes drug, Invokana, had been approved by the FDA. Invokana is an SGLT2 inhibitor — the first of which to be approved in the U.S. — and works in the kidneys to suppress glucose reabsorption as opposed to DPP-4 inhibitors like Merck & Co., Inc. (NYSE:MRK)‘s Januvia, which go to work in the pancreas and liver. Having beaten Januvia in a head-to-head test in trials, and with the added benefit of weight loss, Johnson & Johnson (NYSE:JNJ)’s Invokana appears to be the next blockbuster diabetes treatment.

Just a day later, on Tuesday, Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) shares soared after GlaxoSmithKline plc (ADR) (NYSE:GSK) and Cubist Pharmaceuticals Inc (NASDAQ:CBST) were named as potential buyers of Optimer by sources familiar with the matter in a Bloomberg report. The news shouldn’t be a huge surprise, as it announced a strategic review in February, which is fancy terminology that it could be looking to put itself up for sale. While the Street appears excited, I’m a little more tempered in my enthusiasm, as its only FDA-approved drug, Dificid, isn’t exactly a huge profit-maker.

The end of the week also brought good news for Biogen Idec Inc. (NASDAQ:BIIB) investors — as if you haven’t been riding high already from the approval of Tecfidera — when the company announced positive midstage results for Daclizumab for the treatment of multiple sclerosis. Data from the trial demonstrated that Daclizumab reduced the annual relapse rate by a whopping 54%. In addition, both dosing regimens met the secondary endpoints as well which involved reducing relapses after one year, and shrinking MS-related brain lesion activity at specified time intervals. Between its recent purchase of the full right to Tysabri from Elan Corporation, plc (ADR) (NYSE:ELN) and Tecfidera’s approval, Biogen Idec Inc. (NASDAQ:BIIB) is asserting itself as the name to be reckoned with in multiple sclerosis.

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