The iShares NASDAQ Biotechnology Index ETF (NASDAQ:IBB) surged Thursday in midday trading, driven by a huge M&A deal and a blockbuster earnings beat.
It’s been a rough year for the IBB, which has plunged 17% in 2016. The index fund has been hit by several meltdowns of individual biotech names, but finally receive a couple of pieces of bullish news today.
Kidney disease drugmaker Relypsa (RLYP) was acquired today by Galencia Group for $1.5 billion. The $32 per-share deal represents a massive 58% premium over RLYP’s Wednesday closing price. Relypsa IPOed back in November 2013, and had recently received FDA approval for a potential blockbuster new drug.
Elsewhere in biotech, Biogen Inc (BIIB) is soaring today, up nearly 6% following a much better than expected Q2 earnings report. That stock had been a poster child for the biotech meltdown, because it plunged from its 2015 highs of around $475 per share all the way down to $223 per share earlier this year. That 50% haircut to such a large cap company no doubt contributed greatly to IBB’s rough period.
The IBB, which has more than $7.5 billion in assets under management, gained rose $3.54 (+1.28%) to $280.08 in late morning trading.
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