The biotech corner of the broad healthcare sector outperformed last week on speculation over a takeover bid for Global Blood Therapeutics GBT. This is especially true as shares of GBT skyrocketed 95% to a two-year high on the rumor, propelling a market value of more than $4 billion for the Global Blood.
The news has led to a surge in biotech ETFs. Virtus LifeSci Biotech Products ETF BBP was the show stopper, spiking 16.7% last week, while ALPS Medical Breakthroughs ETF SBIO, SPDR S&P Biotech ETF XBI and Virtus LifeSci Biotech Clinical Trials ETF BBC has gained nearly 14% each (read: 5 ETFs Riding High on the Biotech Comeback).
The drug giant Pfizer Inc. PFE is in advanced talks to buy Global Blood Therapeutics, the maker of a therapy for sickle-cell disease, for about $5 billion, per the Wall Street Journal. The deal is expected to be finalized in the coming days. This is the latest move by Pfizer to bolster its portfolio and pipeline as the company is seeking long-running sales growth that doesn’t depend on pandemic products.
The acquisition would propel Pfizer’s presence in rare diseases, furnishing a drug already on sale for the treatment of sickle-cell disease as well as two in development that have produced positive results in preliminary studies. Notably, sickle-cell disease is an inherited blood disorder affecting about 100,000 people in the United States, including 1 in 13, who are Black.
In May, the drug giant agreed to buy the migraine drugmaker Biohaven Pharmaceutical Holding Co. for $11.6 billion.
Virtus LifeSci Biotech Products ETF (BBP)
Virtus LifeSci Biotech Products ETF follows the LifeSci Biotechnology Products Index, which measures the performance of biotechnology companies with at least one drug therapy approved by the FDA (read: 3 ETFs Braving Inflationary Fears in Past Three Months).
Holding 50 stocks, Virtus LifeSci Biotech Products ETF has accumulated AUM of $15.4 million and charges 79 bps in fees per year. BBP trades in a volume of 1,000 shares a day on average and has a Zacks ETF Rank #3 (Hold) with a High risk outlook.
ALPS Medical Breakthroughs ETF (SBIO)
ALPS Medical Breakthroughs ETF provides exposure to companies with one or more drugs in phase II or phase III FDA clinical trials by tracking S-Network Medical Breakthroughs Index. It holds 136 securities in its basket.
ALPS Medical Breakthroughs ETF charges 50 bps in fees per year from its investors and trades in a moderate average daily volume of about 24,000 shares. It has AUM of $108.8 million in its asset base and carries a Zacks ETF Rank #3 with a High risk outlook.
SPDR S&P Biotech ETF (XBI)
SPDR S&P Biotech ETF offers equal-weight exposure across 135 biotechnology stocks. It follows the S&P Biotechnology Select Industry Index, charging investors 35 bps in annual fees.
SPDR S&P Biotech ETF has AUM of $7.8 billion and trades in an average daily volume of 12.4 million shares. XBI has a Zacks ETF Rank #2 (Buy) with a High risk outlook (read: Has the Market Bottomed? 6 ETFs in High Momentum).
Virtus LifeSci Biotech Clinical Trials ETF (BBC)
Virtus LifeSci Biotech Clinical Trials ETF offers exposure to companies with promising drugs in clinical human trials that have not yet been approved by the FDA or gone into production. It follows the LifeSci Biotechnology Clinical Trials Index and holds 181 securities in its basket, with none accounting for more than 1.4% share.
Virtus LifeSci Biotech Clinical Trials ETF amassed $17.5 million in its asset base and charges 79 bps in fees per year from its investors. It trades in an average daily volume of 4,000 shares and carries a Zacks ETF Rank #3 with a High risk outlook.
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Pfizer Inc. (PFE) : Free Stock Analysis Report
Global Blood Therapeutics, Inc. (GBT) : Free Stock Analysis Report
Virtus LifeSci Biotech Clinical Trials ETF (BBC): ETF Research Reports
SPDR S&P Biotech ETF (XBI): ETF Research Reports
ALPS Medical Breakthroughs ETF (SBIO): ETF Research Reports
Virtus LifeSci Biotech Products ETF (BBP): ETF Research Reports
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