Why Halozyme Therapeutics Inc. Shares Surged

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 Halozyme Therapeutics (NASDAQ: HALO  ) , a developer of human enzymes that alter human tissue and allow for the easier delivery of injected drugs, surged as much as 10% after receiving an analyst upgrade.

So what: After the closing bell last night Halozyme received an upgrade from research firm UBS to buy from neutral, with the firm also boosting its price target 14% to $16. Specifically, the covering analyst, Andrew Peters, honed in on Halozyme's lower risk associated with three already approved products, the recent removal of PEGPH20 from clinical hold being a positive, and the strong launch of Herceptin-SC, a subcutaneous dosing of Herceptin, which can be done in a fraction of the time as a standard infusion and for which Halozyme receives a percentage of sales from Roche.

Now what: I've said it before and I'll say it again: You need to get Halozyme Therapeutics on your watchlist. Herceptin-SC/MabThera-SC offer a big boost in patient convenience compared to an infusion, and I would suggest this combo may deliver blockbuster potential in due time, meaning Halozyme could be nearing a turn toward full-year profitability. With a robust pipeline that includes a number of big-name collaborations as well as proprietary in-house studies I suspect that Halozyme shares could have significant room to run higher over the long run.

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Sean Williams

A Fool since 2010, and a graduate from UC San Diego with a B.A. in Economics, Sean specializes in the healthcare sector and in investment planning topics. You'll usually find him writing about Obamacare, marijuana, developing drugs, diagnostics, and medical devices, Social Security, taxes, or any number of other macroeconomic issues.

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Related Tickers

8/27/2015 4:00 PM
HALO $18.04 Up +0.58 +3.32%
Halozyme Therapeut… CAPS Rating: ***