Why Aegerion Pharmaceuticals, Inc. Shares Sank Like a Stone

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Aegerion Pharmaceuticals (NASDAQ: AEGR  ) , a biopharmaceutical company focused on therapies to treat rare and unmet diseases, dipped as much as 14% after reporting its preliminary 2013 and 2014 sales guidance and disclosing a Department of Justice subpoena over the marketing of lead drug, Juxtapid, after the closing bell last night.

So what: According to Aegerion's press release, it anticipates reporting preliminary 2013 net product sales of $48 million to $49 million and estimates 2014 sales will be in the range of $190 million to $210 million. By comparison, Wall Street had forecasted $49.8 million in sales in 2013 and $204.2 million in 2014. The real downer today, though, is the announcement that the DOJ is requesting documents related to the marketing of its homozygous familial hypercholesterolemia drug, Juxtapid. Aegerion announced that it intends to cooperate fully with the investigation.

Now what: Although sales estimates for 2013 came in a bit lighter than estimates, the concern with investors is solely over the marketing subpoena. The problem with this subpoena is twofold. First, these investigations can go on for weeks or months, placing a cloud of uncertainty around Aegerion's share price and potentially capping any near-term gains. Second, there's the possibility that, if any wrongdoing were discovered, it could result in fines. Obviously, there have been plenty of investigations from the DOJ that have resulted in no wrongdoing or just a slap on the wrist, but some do indeed result in fines. I was already concerned about Juxtapid's high price point and sales potential relative to the competing HoFH treatment on the marketplace, Kynamro, from Isis Pharmaceuticals and Sanofi, so today's news gives me even more recourse to avoid the company in the meantime.

Here's an opportunity you won't want to miss!
Opportunities to get wealthy from a single investment don't come around often, but they do exist, and our chief technology officer believes he's found one. In this free report, Jeremy Phillips shares the single company that he believes could transform not only your portfolio, but your entire life. To learn the identity of this stock for free and see why Jeremy is putting more than $100,000 of his own money into it, all you have to do is click here now.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2791118, ~/Articles/ArticleHandler.aspx, 7/30/2014 3:23:47 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement