3 Humongous Health-Care Stocks This Week

Wall Street's and Washington's worries about the so-called fiscal cliff affected a lot of stocks this week, but some shrugged off any concerns. Here are three of the humongous performers in the health-care sector that gave investors some holiday cheer.

On angel's wings
Shares for Halozyme Therapeutics (NASDAQ: HALO  ) soared with wings like an angel this week. The stock shot up 25% for the week after announcing a development deal with Pfizer (NYSE: PFE  ) on Friday.

Under the agreement, Halozyme receives $8 million up front for Pfizer in exchange for licensing use of its rHuPH20 enzyme. The initial payment allows Pfizer to use the enzyme for two therapeutic targets. However, Pfizer can expand to up to six targets upon making additional payments. Halozyme could eventually receive as much as $507 million if certain milestones are reached plus royalties on any marketed products.

Despite the surge this week, Halozyme's shares remain down over 26% for the year. This decrease stems in large part from an FDA decision in August to reject Baxter's (NYSE: BAX  ) HyQ biologic, which uses Halozyme's rHuPH20 enzyme.

Rite on
Drugstore chain Rite Aid (NYSE: RAD  ) saw shares jump 18% for the week after reporting good quarterly results on Thursday. The company has struggled quite a bit, but the momentum from the latest news just might propel the stock to a slightly positive return for the year. 

Rite Aid posted its first quarterly profit in five years, an achievement that chairman and CEO John Standley referred to as "a significant milestone" in the company's "turnaround efforts." The recent quarter also represented the eighth consecutive quarterly increase in adjusted EBITDA and same-store prescriptions for the chain.

The return to profitability for Rite Aid is encouraging. While the company's $6 billion debt load makes the road ahead a challenging one, at least things appear to be headed in the right direction for a change.

Keeping it going
Aegerion Pharmaceuticals
(NASDAQ: AEGR  ) appeared to continue to benefit from last week's news. Last Friday, the stock hit a 52-week high after a European Medicines Agency committee passed along a negative recommendation for a potential rival drug made by Isis Pharmaceuticals (NASDAQ: ISIS  ) and Sanofi (NYSE: SNY  ) . Aegerion continued its momentum this week with shares rising 17%.

The real catalyst for Aegerion, though, stems from the Oct. 17 decision by an FDA advisory committee to recommend approval for the company's lomitapide cholesterol drug. Aegerion shares began climbing before the committee's vote and are up 33% since then.

A decision by the FDA for lomitapide is scheduled for Dec. 29. FDA approval doesn't guarantee that Aegerion shares will respond positively, though. The possibility exists that the agency could approve lomitapide but with restrictions that limit the number of patients who can take the drug. If that happens, the nice momentum from the last few months could be halted. 

One more to go
It's hard to believe how quickly the year has passed by, but we only have one more week remaining in 2012. While Halozyme, Rite Aid, and Aegerion are the most humongous health-care stocks for this week, what will the best stock for 2013? 

 

The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in our brand-new free report: "The Motley Fool's Top Stock for 2013." I invite you to take a copy, free for a limited time. Just click here to access the report and find out the name of this under-the-radar company.


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