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• VPHM 100% Rate It

ViroPharma has been trending lower, and one bear is looking for another push to the downside.

optionMONSTER's Depth Charge monitoring system detected the purchase of 6,000 August 22.50 puts for $1.60 and the sale of 6,000 August 15 puts for $0.05. Volume was more than 8 times open interest at both strikes.

The trade cost $1.55 and will earn a maximum profit of 384 percent if the drug maker closes at or below $15 on expiration. It's known as a bearish put vertical spread because it controls a move between two prices. (See our Education section)

VPHM traded above $32 in March and fell below $20 last month. It's been rebounding more recently and rose 0.56 percent on Friday to close at $23.16. That could be leading some momentum traders to believe that it's now ready to drop again.

The company has faced a double-whammy of generic competition and weak financials. In April, regulators agreed to let Watson Pharmaceuticals sell a version of its Vanconin antibiotic. Three weeks later, quarterly results missed estimates and management slashed guidance. (See researchLAB for more)

Overall option volume in VPHM was 69 times greater than average on Friday, according to the Depth Charge. Puts outnumbered calls by almost 400 to 1.

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