MannKind Corporation (MNKD), PDL BioPharma Inc. (PDLI) & Optimer Pharmaceuticals, Inc. (OPTR): 2 Biotechs to Avoid, 1 to Buy

Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR)

Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) is involved in developing and commercializing of pharmaceuticals. The primary products of Optimer are DIFICID and DIFICLIR tablets. The company has a number of candidates in various stages of clinical trials including further applications of DIFICID and Fidaxomicin for the treatment of CDI.

The share price of Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) has fluctuated between $8 and $17 during the last year. The stock has rallied by almost 51% in the last six months. During the same period, institutional investors have dumped almost 6.6 million shares of the company, reducing institutional holding by a staggering 21%.

Despite recent appreciations, the stock is still trading at a 13% discount to mean sell side target price. Considering the fact that institutions are taking profits, investors should wait for solid trial data before making a long term investment in Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR).

Keep in mind the rumors that AstraZeneca or Cubist Pharmaceuticals is interested in buying Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR). Any material development in this regard could dramatically change the thesis I laid out above.

Bottom-line

The outlook is bearish on PDL BioPharma Inc. (NASDAQ:PDLI) and Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR) due to heavy selling by institutional investors. But MannKind Corporation (NASDAQ:MNKD) is an excellent biotechnology investment, and its heavy insider buying supports this thesis.

Mohsin is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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