MedImmune Inc. believes that its best days are still to come. Others don?t.
A Maryland-based pharmaceutical company, MedImmune has recently come under fire from one of its major shareholders, Matrix Asset Advisors Inc. Calling for the company to sell itself, Matrix wants MedImmune to market its strengths of a strong development pipeline and several drugs on the market.
“While we think management has done some very good things,” said David A. Katz, chief financial officer of Matrix, “we think the gap between what the company has executed on and accomplished and where stock price has gotten wider and wider, and we think at the same time there is a need by the pharmaceutical company to take advantage of the biotech labs.”
Katz has written twoletters in the past two months to the MedImmune board of directors, calling for “the strategic sale of the company now.” According to Katz, if the company goes up for sale now, it could raise around $40 to $45 per share for shareholders, a profit of more than $8 dollars per share above where the stock currently sits at around $32 per share. But MedImmune disputes Katz?s course of action, citing in a news release last week that it will stick to its five-year plan.
“Our board of directors has considered the suggestion that Mr. Katz has outlined,” said Jamie Lacey, a MedImmune spokesperson, “And the board continues to believe that the best way for it to return value to its shareholders is to execute its business plan.”
MedImmune, located in Gaithersburg, currently has drugs like Synagis and FluMist in circulation, with more in its research and development pipeline. These “pipelines” are valuable commodities for larger pharmaceutical companies looking to acquire smaller businesses.
Despite the outcry from Katz that now is the time to capitalize on the market, MedImmune released a statement last week claiming financial growth, “reconfirming its 2006 guidance of $1.3 billion in revenues and an earnings per diluted share of $0.17 to $0.22.”
“From our perspective as a MedImmune shareholder that would be a very healthy premium sooner rather than later,” Katz said. “We feel the environment is right for them to sell right now.”
