Post by gutset on Oct 12, 2016 19:50:49 GMT
Phillip Frost snaps up $250K in Opko Health stock despite Medicare setback
www.bizjournals.com/southflorida/news/2016/10/12/phillip-frost-snaps-up-250k-in-opko-health-stock.html
Oct 12, 2016, 2:20pm EDT Updated Oct 12, 2016, 2:23pm EDT
Phillip Frost is standing by Opko Health.
The billionaire on Monday ponied up nearly $250,000 for additional shares in the Miami-based biotech company, of which he is a 10 percent owner.
He shelled out $243,536 for 24,800 shares at an average price of $9.82 per unit, just days after Opko (NYSE: OPK) stock plummeted nearly 10 percent due to a setback on 4Kscore, a prostate cancer screening test that Frost championed on “Mad Money” as a game changer for the entire health care system.
Medical claims-processing firm Palmetto GBA last week posted a no-coverage decision on the screening test.
Promising to eliminate the need for millions of costly biopsies, 4Kscore was expected to be a significant growth driver for Opko. The no-coverage decision by Palmetto — one of the country’s largest medicare contractors — triggered analysts, such as Jefferies’ Brandon Couillard, to reiterate “hold” ratings on the stock.
“Hold” recommendations indicate that a stock is expected to perform with the market or at the same pace as comparable companies — not a dagger, but certainly a far cry from the fanfare Opko garnered in the past.
In mid-2015, its stock skyrocketed more than 90 percent year-to-date based on the strength of its businesses, a mix of pharmaceutical developments to diagnostics tests.
Just weeks later, however, the stock lost over half its value — trading from $19 to less than $10. The downturn was spurred by Opko’s acquisition of Bio-Reference Laboratories, a New Jersey-based full-service clinical laboratory company. The stock market reacted harshly to the $1.47 billion all-stock transaction. Months of underwhelming market performance followed.
Amid the slump, Frost appeared on CNBC’s “Mad Money,” where he spoke with host Jim Cramer about why Opko Health remained a good buy despite obstacles. He insisted on the show that the hits Opko had taken were one-offs amid homeruns, including the oncoming 4Kscore test.
The acquisition of Bio-Reference, he said, gave Opko access to infrastructure that would 4Kscore “one of the most important tests in the diagnostics business.”
“You can just imagine that there are 30 million PSAs done on men every year in the United States, of which approximately 4 million are elevated. Now everyone of those is a candidate to have a 4Kscore,” he said.
The screening tool’s introduction to the market, Frost added, would be a game changer to the entire health care system by eliminating the need for nearly 50 percent of biopsies.
“This is an important test,” he said.
As it stands, the commercial path for 4Kscore is uncertain. Some analysts expect Palmetto peer Novitas to offer a different coverage determination, but that remains to be seen.
www.bizjournals.com/southflorida/news/2016/10/12/phillip-frost-snaps-up-250k-in-opko-health-stock.html
Oct 12, 2016, 2:20pm EDT Updated Oct 12, 2016, 2:23pm EDT
Phillip Frost is standing by Opko Health.
The billionaire on Monday ponied up nearly $250,000 for additional shares in the Miami-based biotech company, of which he is a 10 percent owner.
He shelled out $243,536 for 24,800 shares at an average price of $9.82 per unit, just days after Opko (NYSE: OPK) stock plummeted nearly 10 percent due to a setback on 4Kscore, a prostate cancer screening test that Frost championed on “Mad Money” as a game changer for the entire health care system.
Medical claims-processing firm Palmetto GBA last week posted a no-coverage decision on the screening test.
Promising to eliminate the need for millions of costly biopsies, 4Kscore was expected to be a significant growth driver for Opko. The no-coverage decision by Palmetto — one of the country’s largest medicare contractors — triggered analysts, such as Jefferies’ Brandon Couillard, to reiterate “hold” ratings on the stock.
“Hold” recommendations indicate that a stock is expected to perform with the market or at the same pace as comparable companies — not a dagger, but certainly a far cry from the fanfare Opko garnered in the past.
In mid-2015, its stock skyrocketed more than 90 percent year-to-date based on the strength of its businesses, a mix of pharmaceutical developments to diagnostics tests.
Just weeks later, however, the stock lost over half its value — trading from $19 to less than $10. The downturn was spurred by Opko’s acquisition of Bio-Reference Laboratories, a New Jersey-based full-service clinical laboratory company. The stock market reacted harshly to the $1.47 billion all-stock transaction. Months of underwhelming market performance followed.
Amid the slump, Frost appeared on CNBC’s “Mad Money,” where he spoke with host Jim Cramer about why Opko Health remained a good buy despite obstacles. He insisted on the show that the hits Opko had taken were one-offs amid homeruns, including the oncoming 4Kscore test.
The acquisition of Bio-Reference, he said, gave Opko access to infrastructure that would 4Kscore “one of the most important tests in the diagnostics business.”
“You can just imagine that there are 30 million PSAs done on men every year in the United States, of which approximately 4 million are elevated. Now everyone of those is a candidate to have a 4Kscore,” he said.
The screening tool’s introduction to the market, Frost added, would be a game changer to the entire health care system by eliminating the need for nearly 50 percent of biopsies.
“This is an important test,” he said.
As it stands, the commercial path for 4Kscore is uncertain. Some analysts expect Palmetto peer Novitas to offer a different coverage determination, but that remains to be seen.