I had been in POZN the company which created Vimovo and is now getting royalties from Horizon for it. I got in around $5.50 (pre $1.75 cash return) and sold it around $8.5 (after $1.75 cash return) a while ago.
They have an April PDUFA date for another drug which they have partnered with Sanofi. On approval of that, they get a decent milestone from Sanofi and then they get very good royalties from Sanofi for selling that drug.
I got out because there was a 3 month delay (Jan PDUFA date was extended to April) and thought that the stock would take a bigger hit. It hasn’t.
So, I got back in just below $8 last week.
POZN has cut its staff to just 16 employees and will make a lot of money from sales of Vimovo and the new drug (when approved). They have made it clear that they are not developing any new drugs and that they want to return most of the profits to their share holders through dividends / cash return (similar to the $1.75 cash return two months ago).
Most likely they will be acquired outright by Horizon or Sanofi.
http://finance.yahoo.com/q/ae?s=POZN+Analyst+Estimates
They are expected to earn 0.83 in 2014 and 1.07 in 2015. It could easily beat that if Vimovo sales are much higher. With just 16 employees and a 30 million float, the profits will explode even if Vimovo royalties were to come in $3-5 million higher than expected or if their new drug start selling better than expected. (provided it gets approved in April).
Note: POZN should start running as we approach the April 25th PDUFA date.
Here’s an excellent article on POZN by the Zack’s analyst Jason Napadano who has been suggesting POZN as an investment right since it was in the mid 4s (pre $1.75 cash return) last year. He thinks that the new drug ¶ could be making huge money for Pozen (12.5% to 22.5% royalties)
http://seekingalpha.com/article/2069373-pozen-looking-very-a…
We think PA is a $300 million product in the U.S. Pozen management expects Sanofi U.S. to put forth a “first class” effort with PA, piggy-backing off the success in this area by the company with mega-blockbuster Plavix. We remind investors that besides the $20 million in pre-commercialization milestones, Pozen is entitled to sales milestones and royalties from Sanofi U.S. ranged between 12.5% and 22.5% on sales.