BioMarin Pharmaceutical Inc. (BMRN)

Summary:

BioMarin Pharmaceutical Inc. (BMRN) is a bio-pharmaceutical company that specializes in the development and commercialization of blockbuster drugs used to treat rare diseases and conditions. Its current portfolio of approved drugs include Naglazyme, Kuvan, Aldurazyme, and Firdapse (see below). There are also three drugs that are currently in either Phase 1 or Phase 2 of clinical trials. The company focuses on developing products under the shield of the Orphan Drug Act , a law that encourages pharmaceutical drug development for drugs with small markets by granting exclusive rights to sell without competition for seven years.

BioMarin also participates in business agreements and strategic alliances with Genzyme and Merck Serono.


Key Financials:



Reasons to Buy:
- December 2009 - European Union Approval of Firdapse with plans to start selling within the region beginning March 2010.

- Strong revenue growth and recent emergence from negative net income.

- A recent SEC letter detailing the resignation of the Chairman of the Board of Directors that hints at relaxing the shareholder rights plan to make way as an acquisition target in order to maximize value for shareholders.

Reasons to Sell:
- Several major products, Aldurazyme (2010) and Naglazyme (2012), will be vulnerable to competition as it will no longer be protected by the Orphan Drug Law in the United States.

- Most of the pipeline of drugs are in the Phase 1 or Phase 2 of testing, which implies at least 3-years before the next product is introduced, absent any acquisitions.

Analyst:
Albert Mo is an MBA Candidate at the Weatherhead School of Management at Case Western Reserve University with work experience in the biotech/medical industry.

Sources:
BMRN 10-k SEC Filing (February 26, 2010)

Resignation Letter of Joseph Klein III (March 19, 2010)