The pharmaceuticals giant AstraZeneca hit a four-year high yesterday despite reports that it will not increase the price of its "superstatin" Crestor now that the competitor Zocor has gone off patent.
Some traders remain convinced that recent strong newsflow on Crestor will lead to a bid for the company, and the shares surged 111p to 3,242p. Dresdner Kleinwort became the latest broker to increase its forecasts for AstraZeneca and also upped its target price on the stock to 3,315p and its recommendation from "sell" to "add".
Since the UK rival GSK lost out in the auction for Pfizer OTC to J&J, takeover talk has intensified.
GSK are thought to be keen to do a big deal this year.
Although there would be regulatory issues to be overcome in the event of a GSK bid for AstraZeneca, traders said there would be a long queue of buyers for the parts of AstraZeneca that GSK would be forced to sell. GSK, a long-term underperformer in comparison to many of its rivals, added 33p to 1,500p.
Insider's view: the fact remains that Crestor has failed to get anywhere near the 20% market share that was forecast by the last two CEO's.
It is a "dog" in marketing terms.
None the less, it would be ironic if Crestor's latest PR "successes" helped fuel AZ's ultimate demise.
Source: The Independent
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