Wednesday, November 21, 2007

Hit #183 (Pharmion)

Pharmion (PHRM), a pharmaceutical company with focus on cancer, is being acquired by its larger partner Celgene (CELG) for $2.9 billion. The part cash / part stock offer comes to $72/share, a gain of 299% over my average cost of $18.06 when I bought shares a bit more than a year ago.

I intend to hold onto the Celgene shares that I get in this deal. Celgene has the potential to grow substantially, and the presence of recent insider buying is encouraging. Despite its size Celgene could itself be a target down the road.

I had bought Pharmion shares in my self-managed IRA portfolio. Some of you have asked me for a larger list of what I hold in that account. I will publish the list of major holdings in that portfolio soon.

For those interested in trivia - among Pharmion's important products is Thalidomide, sold under Thalomid. Yes, it is the same Thalidomide, which happens to be effective in some cancers. The rationale behind the name Thalomid can be read in one of the books I had mentioned in an earlier post - Inside the FDA.

Another player to watch is Millenium (MLNM). Though more likely to be a buyer at this moment, it could also turn into prey. I would like to see more insider buying or a much better valuation before adding to my existing small position.

Previous hit - Business Objects (#182)


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