Biotech Tweet of the Week: Will Icahn Attack Gilead?

This week, the tweet of the week comes from Paul DeSantis, who questions whether Carl Icahn might get involved with Gilead Sciences (NASDAQ: GILD  ) considering all the cash the biotech is expected to throw off over the next few years.

In the video below, senior biotech specialist Brian Orelli and health-care bureau chief Max Macaluso discuss why Icahn might want to become an activist investor in Gilead Sciences and whether that should scare investors. Considering his track record of getting companies sold -- MedImmune to AstraZeneca (NYSE: AZN  ) , Genzyme to Sanofi, ImClone Systems to Eli Lilly (NYSE: LLY  ) , just to name a few -- it can be an advantage to have Icahn on your side in the short term.

In the long run, it's an entirely different story.

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  • Report this Comment On April 29, 2014, at 11:11 PM, drpauldesantis wrote:

    Would just like to clarify, hoping for Carl to push for Gilead to do a major acquisition, or levered share repurchases in the future. The large acquisition in oncology should revert the market valuation framework back to a PEG or P/E basis and multiple expansion for Gilead shares. The key question is on "sustainability" of Gilead's cashflows, in my view time and facts will prove its not an issue, just a reason for bears to bears. A large oncology acquisition or series of small-mid size ones with future cash flows peaking in 2022-2025 would absolutely obliterate the bears sustainability thesis

  • Report this Comment On April 29, 2014, at 11:11 PM, drpauldesantis wrote:

    Thx for the mention too :)

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Brian Orelli

Dr. Orelli is a Senior Biotech Specialist. He has written about biotech, pharmaceutical, and medical device companies for The Motley Fool since 2007.

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GILD $101.49 Down -3.58 -3.41%
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