Sweet! No, I'm not talking about leftover Valentine's Day candy and chocolates. Sweet is the operative word for the returns attained by several health-care stocks this week. Here are three of the week's most humongous performers.
Help from Uncle Sugar
Shares in small biotech Pharmacyclics (UNKNOWN:PCYC.DL) jumped 24% this week with a little help from "Uncle Sugar." The U.S. Food and Drug Administration granted Breakthrough Therapy Designation to ibrutinib for treating relapsed or refractory mantle cell lymphoma and Waldenstrom's macroglobulinemia.
Pharmacyclics also reported quarterly results after the market closed on Thursday. Those numbers beat analyst expectations, but they weren't nearly as important as the good news from the FDA.
The Breakthrough Therapy Designation also presents good news for Johnson & Johnson (NYSE:JNJ), whose Janssen unit has partnered with Pharmacyclics on ibrutinib. This designation, which was first enacted last year, allows for a faster development and review process. Pharmacyclics and Janssen are in discussions with the FDA to determine exactly what impact it will have for the drug.
Like a box of chocolates
The great fictional philosopher Forrest Gump passed on this bit of wisdom from his mother: "Life is a like a box of chocolates. You never know what you're going to get." Ziopharm Oncology (NASDAQ:ZIOP) shares shot up 13% this week on news that the company will soon get to open its version of a box of chocolates.
Ziopharm announced on Tuesday that enough progression-free survival events have been reached to wrap up data collection and begin analysis from a phase 3 study of palifosfamide. This late-stage trial is testing use of the drug in treating patients with soft tissue sarcoma. The company expects to announce results from the study at the end of March.
Another phase 3 study is also under way for studying the effect of palifosfamide in combination with carboplatin and etoposide in treating small cell lung cancer. Even if Ziopharm isn't happy with the results to be announced in March, another "piece of chocolate" awaits.
Short and sweet
There's no love lost between Carl Icahn and Bill Ackman. The highly publicized skirmish between the two billionaire investors took another twist this week. Shares of Herbalife (NYSE:HLF) rose 8% this week after Icahn's 13% stake in the company was reported.At one point on Friday, the stock was up 25% for the week. Those gains didn't hold, though.
It looks like Carl Icahn is attempting to fulfill his own prophecy made on CNBC a few weeks ago when he stated that Herbalife "could be the mother of all short squeezes." The regulatory filing made public on Thursday revealed that Icahn bought 2.5 million shares and call options for another 11.5 million shares in Herbalife over the last several weeks. That's a big bet.
Bill Ackman isn't backing down from his contention that Herbalife is a pyramid scheme, though. He told Bloomberg that he "doesn't feel squeezed" with his $1 billion short position in the company.
Kids in a candy store
These stocks all made shareholders feel like kids in a candy store this week. Which one is most likely to not only taste good now but provide sustenance for the longer term? With two speculative biotechs and one controversial multilevel marketing company in the mix, we can only guess. Shareholders should enjoy their sweets for now.