Pfizer deal moves Gaucher drug stocks

The NYSE Arca Pharmaceutical Index (INDEX:DRG) rose 1.3% to 310.22 and the NYSE Arca Biotechnology Index (INDEX:BTK) inched up 0.3% to 890.31.

Shares of Pfizer (NYSE:PFE) were up over 2% at $18.59.

Pfizer said early Tuesday that it will co-develop Protalix's (AMEX:PLX) Gaucher treatment GCD. Protalix is in the process of applying for U.S. regulatory approval for the product.

Under the deal, Pfizer will pay Protalix $60 million upfront, plus up to $55 million in milestone payments. Pfizer and Protalix will share in the product's future revenue and costs on a 60/40% basis.

Shares of Protalix were down 14% at $8.47 on word of the deal. Shares of the biotech group had been bid up substantially in recent weeks in part on speculation that it would be bought outright by Pfizer.

Shares of Shire plc (NASDAQ:SHPG.Y) were also up 1% at $59.60. Shire has a treatment for Gaucher disease awaiting regulatory approval.

Protalix's drug is currently available to the public on an emergency basis as the leading medication to treat the disease, Genzyme Corp.'s (NASDAQ:GENZ) Cerezyme, is in short supply. The Cerezyme shortage was triggered by a temporarily shut-down earlier this year of a key Genzyme manufacturing plant due to contamination concerns. See story on Gaucher drug market.

Early Tuesday, Genzyme announced that it has resumed shipping of Cerezyme from the plant, along with the medication Fabrazyme. Both products are major revenue drivers for Genzyme.

Shares of Genzyme were up 1% at $51.14.

Shares of Human Genome Sciences, HGS (NASDAQ:HGSI) , were down 3% at $26.91.

Late Monday, HGS said announced it has commenced a public offering of 12.5 million of its common shares. The company said it plans to use part of the proceeds to fund commercialization of its eagerly-anticipated lupus drug Benlysta.