Healthcare Stocks Mostly Lower Near Bell; OncoMed Soars Following Collaboration Pact with Celgene

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Healthcare stocks are sharply lower with the NYSE Healthcare Sector Index falling about 0.7% and shares of healthcare companies in the S&P 500 sliding 0.9% as a group.

In company news, OncoMed Pharmaceuticals Inc. ( OMED ) is set to nearly double in price today, with shares rising over 93% to $27.05 each after inking a deal with Celgene Corp ( CELG ) pairing the biopharmaceutical companies to jointly develop and commercialize up to six anti-cancer stem-cell product candidates from OMED's biologics pipeline.

Under the agreement, OMED will receive a $155-million, upfront payment with CELG also purchasing just over 1.47 million OMED shares at $15.14 apiece - and 8.1% premium to OMED's closing price yesterday. The $22.3 million investment will provide CELG with a 5% stake in its partner company.

The agreement also includes option-exercise and milestone payments, paid on a per-program basis. For demcizumab, one of OMED's more advanced drug candidates to treat pancreatic cancer, these payments could eventually total $790 million, the companies said.

CELG is down nearly 2% in late trade at $160.08 a share.

In other sector news,

(+) CNAT, U.S. Food and Drug Administration grants orphan drug status for the company's Emricasan drug candidate - now in Phase IIb testing - to stymie recurrent fibrosis and cirrhosis in liver-transplant recipients.

(-) THO, Q1 earnings of $0.68 per share, ex items, trail analyst expectations by $0.02. Revenue rises 5.1% year over year to $800 mln, roughly matching Street view looking for $802.6 mln in quarterly sales.



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This article appears in: Investing , Commodities

Referenced Stocks: CELG , OMED

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