Losing An Old Friend

The DeStocker got up this morning, gave Mrs. DeStocker a goodbye buss as she headed off to her soul-crushing-but-economically-prudent-job, and sat down to his traditional homemade breakfast of coffee and an omelette aux fines herbes. While engaging in his daily curse-a-thon towards FreshDirect's lack of chervil, he decided to start a blog.

Yes, I will be blogging. While wearing pyjamas, of course, because that's the only truly authentic way to blog - much like how the Amazon.com guys started the company in a garage even though they could afford an office, because all good companies get started in a garage, right? Actually, the best bloggers blog naked but I think the cable guy is coming today and I don't want to give him ideas. I saw something similar to that in a movie once and it didn't end well.

As my deepest thoughts devolve to what I might want to make myself for lunch, I realize that I should probably return to the original subject of this blog: healthcare stocks. Yes, I was once a professional stock-chooser on behalf of a hedge fund or two. And like many of the professional stock-choosers, my tenure in that role has come to a sad end. Not really that sad, actually, as I  can pretty definitively say that obsessing about whether or not Celgene is going to miss or beat the quarter is no way to spend a life. But since I am now looking for a new job and I realize that I should probably maintain some semblance of conversational ability with the healthcare stocks (so I can tell my colleagues in the stockroom what I used to do for a living), I will happily share my thoughts with you, the interweb-reading public, unless it becomes boring or I find something better to do or learn how to knit or something.

Today I am a sad witness to the departure of one of the all-time great biotechnology stories; a company that will be remembered as a hotbed of innovation and an incubator of talent, with great products and a rich corporate culture. It's almost like saying goodbye to an old friend. I am referring, of course, to CV Therapeutics. 

I think this photograph, taken at NASDAQ opening bell ceremony in February 2008, says it all. Look at the beaming faces of all the corporate participants, except for Lou Lange - he gazes at his hands with downcast eyes, noting the lines and calluses in their rough-hewn form, knowing that the end is coming and that the eventual fruits of his labor will be bittersweet, like a partially-poached quince.

I thought for ease of reference I'd create a nice little table that summarizes the differences between CV and some other company that recently got taken out by a bunch of cantonese 

	Some other company	CV Therapeutics
Strategic genius	Art Levinson	Lou Lange
Blockbuster product that shocks everyone with its efficacy, safety, and tolerability	Avastin	Ranexa
Slightly disappointing product that does not live up to commercial expectations	Raptiva	er, Ranexa
Deft strategic move	Cabilly reexamination	Aceon
Kind of uncool	Suing City of Hope	Pretending MERLIN was positive
Reason for takeout	A highly evolved version of insider trading	The Kasparovesque strategic moves of the Silver Fox
Place your bets on	C-08	Over/under on first generic filing

I think the most important and lasting impression that will come from this will be that I want Frederick Frank working for me, too. If he was able to sell CVT to Gilead for $20 a share then I want him to be the one renegotiating my mortgage.

Finally, the best part about this transaction has been watching the reaction of sell-side analysts who cover Gilead, and who previously wouldn't deign to sneeze on CV Therapeutics if their QT interval depended on it. All of a sudden, this is a great opportunity to talk about darusentan! Of course, darusentan has to work now, otherwise Gilead has wasted a billion dollars. Or, more accurately, has wasted an additional $1.5 billion after buying darusentan in the first place for $2.5 billion (I am not ascribing any value to ambrisentan because, as far as I can tell, its only purpose was to distract hedge fund analysts into complicated cross-border shorts of Actelion, thus distracting them from engaging in profitable pursuits like buying CVTX long). 

Really, folks, this relationship needs to come to an end.