Shares of MedImmune Inc. jumped 9 percent yesterday to close at a record high as investors snapped up stock in the one company poised to benefit from rapid spread of a virus that sickens and sometimes kills premature babies.
Respiratory syncytial virus normally peaks in the winter. Doctors and the U.S. Centers for Disease Control and Prevention are reporting unusually high levels this year, possibly linked to the rising number of very young children in day care.
MedImmune, of Gaithersburg, sells a drug called Synagis, a laboratory-designed antibody that binds to the virus. Given in the winter as a string of monthly injections that cost about $1,000 apiece, the drug has been proved to prevent most hospitalizations linked to respiratory syncytial virus.
MedImmune was recently added to the Nasdaq 100, a list of large, high-volume issuers whose shares are listed on the Nasdaq Stock Market, and yesterday was the first day its shares traded as a member of that group. It's likely that some of the gain in price was linked to share buying by trusts and mutual funds that hold a basket of Nasdaq 100 stocks.
Even before doctors began sounding the alarm about the virus this season, Synagis had propelled MedImmune to superstar status among biotechnology companies. It is by far the most successful such company in the Washington region and, measured by the value investors place on its stock, has become one of the 10 largest biotechnology companies in the world.
MedImmune shares have tripled in a year, closing at $141.12 1/2 yesterday, compared with $46.18 3/4 on Dec. 21, 1998. The stock has gained 42 percent just since the end of September.
Lori Weiman, director of investor relations for MedImmune, said the company does not comment specifically on movements in its share price, but she said executives are gratified to see MedImmune's success reflected in its market valuation.
This will be the second season on the market for Synagis, and MedImmune recently brought online a large new production plant in Frederick, Md. Growing awareness of the drug, as it happens, coincides with rising alarm about the virus among parents of premature babies, who are most at risk of harm from the virus. Analysts are projecting big sales gains as pediatricians administer injections to record numbers of babies this year. The consensus of analysts is that MedImmune will book $320 million of Synagis sales this season, compared with $228 million last season.
In healthy babies, the effects of respiratory syncytial virus are indistinguishable from those of the common cold. Virtually every American has had the virus repeatedly. But in babies with weak lungs and immature immune systems, the effects can be severe, causing respiratory distress and even death.