Genentech-Roche Deal Shows Attraction Of Biotech Assets

Genentech Inc.'s (DNA) ability to leverage a higher price tag from Roche Holding AG (RHHBY) in an otherwise downtrodden market demonstrates the attractiveness of biotech assets, especially for the right buyer.

However, it remains to be seen if the deal - and its hefty valuation - will prompt additional large biotech acquisitions, even at a time when the health- care industry is remaking itself in the face of government-led changes. In the mean time, smaller and cheaper biotech purchases remain more likely.

Biotech drugs are attractive because they have better margins generally and, currently, no method for generic threat. In addition, biotech companies have unique expertise and facilities, making it tough for others to invade their turf.

As a result, the more successful biotech companies carry large market caps and still-healthy valuations. The industry's advantages are likely why investors may be leaving Genentech shares in the hands of arbitrage traders and putting their money to work in other areas of sector, prompting a 5.6% gain in the Amex Biotechnology Index.

Traditional pharmaceutical companies, most of which are ailing from poor pipelines and generic competition, are turning increasingly to biotech drugs; however, most of Big Pharma's moves have been limited to licensing agreements or acquisitions of smaller biotech companies.

Roche's large purchase of Genentech goes against that trend, but the Swiss giant had a discernible advantage - it already owned 56% of Genentech. That enabled Roche to buy the rest of Genentech for "only" $46.8 billion.

If Roche had to buy all the shares outstanding, the total purchase price would have been around $100 billion, assuming it would have been able to get Genentech to agree to $95 a share without having the advantage of already being the majority owner.

While the price of $95 a share offers only a 16% premium to Genentech's price before Roche's initial July offer, it commands a price-to-earnings multiple of about 25 times the South San Franscisco-based company's projected 2009 earnings. In comparison, biotech bellweathers Amgen Inc. (AMGN), Biogen Idec Inc. (BIIB) and Genzyme Corp. (GENZ) trade at between 10.5 and 12 times 2009 earnings estimates.

In addition, Roche's willingness to raise its original offer by 6.7% - over a time frame in which the S&P 500 fell 43% and the Amex Biotechnology Index lost 30% - indicates the value biotechs maintain.

Because of Genentech's strong price tag, biotech stocks rose Thursday. One of the biggest gainers being Celgene Corp. (CELG), up 12% to $47.17. Celgene has strong products in the blood-cancer drug Revlimid and the blood-disorder treatment Vidaza, and an intriguing pipeline.

Despite its attractive portfolio, Celgene also comes with significant hurdle - its market cap of $21.6 billion. That means a deal with a 40% premium, not uncommon in biotech acquisitions, would put the price tag at $30 billion. A deal at half the premium still would be about $26 billion.

That's a lot for any buyer to swallow and why Big Pharma, which can afford such deals, has preferred more modest biotech deals, such as AstraZeneca PLC ( AZN) buying MedImmune for $15.6 billion or Eli Lilly & Co.'s (LLY) $6.5 billion acquisition of Imclone Systems Inc.

When Big Pharma is ready to spend big, they have stayed within the family, such as Pfizer Inc. (PFE)/Wyeth (WYE) and Merck & Co. (MRK)/Schering-Plough Corp. (SGP). In those cases, the acquiring company can leverage more natural synergies and big job cuts to produce profits from the deal faster.

Nonetheless, interest in acquiring biotech assets appears to be rising. Last year, according to Dealogic, the amount spent purchasing biomedical and genetic companies totaled $68.4 billion, matching the amount spent on the group during the decade's first eight years and roughly equal to the total spent on pharmaceutical purchases, marking the first year those figures were on similar levels.

Analysts say that among large biotechs, the most likely takeover targets are Amgen, which has a market cap of $51 billion, or, more reasonably priced, Biogen and its $14.5 billion market cap.

The busier biotech market is likely to be for smaller companies suffering from depressed values and the difficult finding environment. Cowen & Co analyst Eric Schmidt names Acorda Therapeutics Inc. (ACOR), Cougar Biotechnology Inc. (CGRB) and Cadence Pharmaceuticals Inc. (CADX) as possible targets because they offer products in late-stage development and the buyer may have some negotiating leverage.

"Those are clearly the types of companies that large pharma and biotech have found attractive in the past," he said.

Senior Google Executive Leaves for AOL...Why?

Time Warner (TWX) has hired one of Google's most senior executives to run AOL. Tim Armstrong was a member of Google's Operating Committee and President of Americas Operations. Armstrong also has a background in traditional media including developing internet properties at traditional media companies.

Armstrong is undoubtedly totally loaded due to his 8 plus years at Google (GOOG), so this seems like an odd move given AOL's declining relevance and very poor financial returns. From that perspective alone, this has to be considered a positive for TWX. Obviously, Armstrong sees something at AOL from which he can create value.

Maybe more important, it seems unlikely that he would move to AOL unless he was given a very clear plan for the future of the division including the possibility that he will either become Chairman of a public company when AOL is spun out or that he will get a big golden parachute when AOL is divested. Either would be bullish for TWX shares.

I've commented extensively that any separation of AOL from TWX is bullish even if value realized for shareholders is not much above $0. That is unrealistic of course. Even after writing down its AOL investment last month, Google's valuation implies a $5 billion valuation, or over $1 per TWX share. Earthlink (ELNK) still has a market cap of $700 million, a reasonable looking stock price chart, and free cash flow machine in its dial-up business (half of AOL).

TWX has said repeatedly that it would directly address AOL's structure after it completed the split from Time Warner Cable (TWC). That will occur at the end of March so I view the new management at AOL as a positive that some resolution is coming in 2009. Once again, almost any resolution is a bullish for TWX.

Iran oil minister: Too much oil on the market

Iran's oil minister suggested Saturday that a weekend OPEC meeting should decide to cut back on crude output, adding his voice to those in the organization who think supply has outstripped demand.

"There is too much oil on the market," Gholam Hossein Nozari told reporters on the eve of a ministerial meeting of the 11-nation Organization of the Petroleum Exporting Countries.

Other influential OPEC members have also said the group should reduce production.

Still their statements have left open whether they want to lower output quotas or if they favor a solution less likely to impact on the struggling global economy by simply seeking to end overproduction by some nations above levels allotted to them.

OPEC cuts agreed on since September were meant to take a daily 4.2 million barrels off the market. But there is general agreement that the 10 members of the group under production quotas are still overshooting their joint target level of just under 25 million barrels by about 800,000 barrels a day.

There is no question the ministers want to bolster prices. While prices are off their low of around $30 just a few weeks ago, a barrel of crude still fetches less than a third of what it did over the summer. That is well below the break-even point for producing nations, which could affect not only their national budgets, but oil production as well.

But as the world grapples with the worst recession in decades, OPEC ministers realize they have to tread lightly.

Cheap crude has been one of the few bright spots in a world economy reeling from the financial meltdown that has led to the deepest and most stubborn global recession in decades. While a substantial output cut could cause prices to spike and increase OPEC revenues, it could prolong economic woes in the U.S. and other major oil consumers.

And such a reduction could not only deepen the perception that OPEC is out for profits, whatever the global costs. It could ultimately backfire in real terms, by further depressing demand and driving down prices.

"They don't want to be seen as fueling recession further, which is what they're going to be seen as doing if the reduce production more," said London-based analyst John Hall.

But if OPEC can't bring in enough money to expand production, there is a danger of a price spike when the global economy recovers.

Two reports published Friday were expected to support traditional OPEC hard-liners such as Venezuela in their arguments that a further output cut is needed.

At the same time, they served as an indirect warning: drive up prices more and face even less demand in a sputtering global economy that already has cut back on consumption.

The International Energy Agency said world demand would drop for a second consecutive year for the first time since 1982-1983. In its closely watched monthly survey, the IEA cut its earlier forecast for demand this year by 270,000 barrels a day to 84.4 million barrels a day — 1.5 percent lower than a year earlier.

"The eventual resumption of global demand growth will largely depend upon much stronger economic performance than is currently the case" among the world's biggest energy consumers, said the agency, adding that the latest indicators are "not encouraging."

An OPEC report, meanwhile, noted that demand for oil produced by the cartel — which can supply more than a third of total world output — was expected to fall this year to 29.1 million barrels. That would be a substantial decline of 1.8 million barrels a day compared to 2008.

Tom Kloza, publisher and chief oil analyst at Oil Price Information Service, said OPEC is in a very bad spot.

"It would be unthinkable that anything can happen at this meeting that would lead to major sort of (upward) move in fuel prices, at least the kind of jolts we became accustomed to from 2005 to 2008," Kloza said. "This isn't the year for it. The world is broke and it's not using energy."

The OPEC meeting comes as the world takes at least a breather from the usual relentless slew of bad news since the financial crisis became most acute last October. The Dow Jones industrial average is up around 10 percent and most Asian and European markets also are climbing.

However, governments and investors are wary of calling the end to the downturn. A failure by the G-20 finance ministers and central bankers to provide a united front at this weekend's meeting in southern England could be one catalyst for a renewed bout of pessimism and market turmoil.

Some OPEC ministers were calling for cuts, nonetheless — either by setting lower target levels or through an end to overproduction.

"In the short term, we need to reach a base price of $70 a barrel," Venezuela's Rafael Ramirez said on arrival Friday to Vienna, adding OPEC will look at depressed demand, growing inventories and compliance with previous production cuts.

"Evidently there still exists a lot of (excess) production in the market and we are going to meet to discuss how we can drain it," he said, in comments released by Venezuela's oil ministry. At the same time, he noted that OPEC needed to be "watching the world economic situation very carefully — it has become much worse than anybody ever imagined."

In an even more direct call for cuts, Algerian Energy and Mining Minister Chakib Khelil said OPEC viewed $75 a barrel as a fair price both for consumers and producers.

"If we do not reduce, prices will fall," he said Wednesday.

But continued concern about the world economy — and apparent pressure within OPEC from oil powerhouse Saudi Arabia to eliminate overproduction by individual members such as Iran and Venezuela — suggest the ministers might opt for a small, symbolic cutback; or perhaps just issue a call for quote compliance.

A relatively strong comeback in prices may help the Saudis and other Gulf producers make their case. Prices have rallied from below $35 a barrel last month, with a barrel of benchmark crude fetching over $46 a barrel on the New York Mercantile Exchange Friday. Earlier in the session, prices peaked at $48.14.

"They're likely to keep the production target at the present level," said Ehsan Ul Haq, chief analyst at Vienna's JBC Energy. To compensate for overproduction by others, "Saudi Arabia has gone below its production target, and they expect 100 percent compliance from others" before considering cutbacks, he added.

IMF Bailout Pool May Be More Than Doubled, G-20 Officials Say

Group of 20 finance ministers pledged to at least double the International Monetary Fund’s bailout pool as the economic crisis forces more countries to seek its support.

“My forecast was that we needed to double our resources,” IMF Managing Director Dominique Strauss-Kahn told reporters after a G-20 meeting near London today. “A commitment to do so has been made. It may even go further.

Strauss-Kahn has lobbied for the fund’s cashpile to rise to $500 billion from $250 billion after being inundated with loan requests from Pakistan to Hungary. A European government official said they agreed to “more than double” the pool, though ministers have yet to say how much they will increase it by.

“It takes months to get the technical details worked out,” said Strauss-Kahn and they may not be agreed by the time heads of government meet in London next month. Still, “the resources we have now are enough to wait.”

The U.S. Treasury has also sought an expansion of the IMF’s supplementary borrowing program by up to $500 billion.

“The G-20 supports our proposal for a substantial increase to emergency IMF resources,” Treasury Secretary Tim Geithner said.

The fund is currently able to borrow about $50 billion -- from 26 mostly wealthy member countries -- through these special financing arrangements. If that proposal won international support, the IMF could have the ability to lend $750 billion and possibly more.

In the past six months, the IMF has approved $16.4 billion for Ukraine, $15.7 billion for Hungary, $10.4 billion for Latvia, $2.5 billion for Belarus, $2.1 billion for Iceland, $7.6 billion for Pakistan and $516 million for Serbia -- a total of about $55 billion. Turkey is negotiating an IMF loan accord, and Romania has expressed an interest in borrowing.

Following The Madoff Money Trail

Bernard Madoff's attorneys filed an appeal to get the convicted swindler out of jail until his June 16 sentencing date. An appeals court will hear the case next Thursday. Meantime, more financial details came to light.

Court documents show that Bernie Madoff and his wife, Ruth, are worth about $823 million.

The assets include his $7 million penthouse in Manhattan, an $11 million mansion in Palm Beach and possessions such $2.6 million in jewelry, $65,000 in silverware, a $7 million yacht named “Bull” and a $39,000 Steinway piano.

The question is how much of this goes back to Madoff’s victims when the disgraced financier is claiming some of his money is legitimate and not dirty?

Fox legal consultant Peter Johnson told John Deutzman, “It's tough to separate a criminal enterprise from a legitimate business and the burden is going to be on Bernie Madoff and his wife to show that the two are not linked.”

Johnson said, “You have to take everything he says with a grain of salt.”

Meantime, Madoff’s attorneys are trying to get him out of jail before he is officially sentenced.

Madoff’s legal team is apparently contending that their client’s financial mess is so complex that they really need to talk to him at the penthouse rather than in jail.

Johnson said, ”There's nothing so complicated about going down to the federal correctional facility and speaking to your client. They've had 3 or 4 months to speak to Mr. Madoff is what the federal government is going to say.

“I expected the court of appeals are going to say to Bernie Madoff, ‘Bernie you gotta stay in prison. I don't see any movement from the federal correctional facility from here to eternity,” he added.

After Madoff goes up the river for good it doesn't mean it's all over for his family and associates. Expect investigation after investigation and lawsuit after lawsuit from all the victims.

Monaco to join tax haven shift

Monaco will soon join moves to relax bank secrecy, following Switzerland, Austria, Luxembourg and representing a quantum leap in the fight against tax fraud, the head of the OECD said on Saturday.

It is even better news for governments at the moment because they need every cent they can get because the worst downturn in decades is shrinking state revenue and bloating outgoings, Angel Gurria, secretary general of the Organisation for Economic Co-operation and development, told Reuters in an interview.

After Belgium and others, Switzerland, Austria and Luxembourg offered on Friday to relax strict bank secrecy in some tax evasion cases in a response to international pressure on tax havens, which is rattling the offshore banking industry.

The OECD spearheaded a campaign with limited success in the earlier half of the decade but its efforts have been given a new lease of life by governments responding to the global financial crisis, notably the G20 economic powers.

Gurria, who attended a meeting tagged to the end of talks among G20 finance ministers in Horsham, south of London, on Saturday, said the international pressure had triggered a "dramatic transformation in just a few days".

The OECD has supplied the G20 governments with information showing which countries met its standards on cooperation in tax matters. G20 finance ministers were preparing a G20 summit due to take place on April 2 and considering whether or not to revise a blacklist of tax havens they would move against.

As far as some still recalcitrant tax havens in places such as the Caribbean were concerned, Gurria said:

"It's going to be difficult to stay out of the loop now".

TALKS ON MONDAY

Among the large financial centres, Gurria said, the likes of Singapore and Hong Kong were now looking to adhere to standards of disclosure established by the Paris-based OECD and Andorra and Liechtenstein had gone public with similar intentions.

Then the Belgians budged on bank secrecy, followed on the eve of the G20 meetings in England by the Swiss, Austrians and Luxembourg, he said.

"We're now working with Monaco," he said, noting that he had been in touch with "the highest authorities" there in the issue and that further contacts were due on Monday to clear the way for similar moves.

A small principality on the Mediterranean, Monaco is famed for its wealthy residents and casino.

Estimates of how much is stored in offshore accounts range from one or two to more than 10 trillion dollars, according to various estimates made in the past decade and cited by the OECD in various reports.

Gurria said it was hard to put a price tag on it just as it was impossible to price the size of the parallel economy in general, but that governments would in any case be delighted to see things moving after years of inertia.

"Clearly governments need every penny they can get into the coffers of their national treasuries due to the recession," he said.

German Finance Minister Peer Steinbrueck told Der Spiegel, a German weekly, his country was happy about the announcements in neighbouring countries where Germany is worried many nationals park money to duck tax. But he remained cautious.

"We're happy about the positive developments. But declarations of intent have to be backed by concrete acts," he said.

So far, Switzerland was not talking about providing names of bank account holders, he said.

Gurria's response was that the pledges to start to lift the lid on decades of strict bank secrecy were a stating point.

"It's early days. This is happening as we speak," he said.

Obama Administration Tries to Reassure China on Treasury Debt

The U.S. sought to ease Chinese Premier Wen Jiabao’s concern about the security of his country’s investments in U.S. government debt, reiterating pledges to cut the budget deficit in half in four years.

“There’s no safer investment in the world than in the United States,” White House Press Secretary Robert Gibbs said yesterday at a briefing in Washington.

Gibbs was responding to comments from Wen that China, the U.S. government’s largest creditor, is “worried” about its holdings of Treasuries and wants assurances that the investment is safe. “I request the U.S. to maintain its good credit, to honor its promises and to guarantee the safety of China’s assets,” Wen said at a press briefing in Beijing.

President Barack Obama is relying on China to sustain buying of Treasuries amid record amounts of U.S. debt sales to fund a $787 billion stimulus package and a deficit this year forecast to reach $1.5 trillion. Investors abroad own almost half of all U.S. debt outstanding, and China last year overtook Japan as the biggest foreign buyer.

Wen’s comments contributed to a decline in Treasuries yesterday. Yields on benchmark 10-year notes rose as high as 2.96 percent, from 2.85 percent a day earlier, and closed at 2.89 percent.

White House National Economic Council Director Lawrence Summers, asked yesterday about Wen’s remarks, said overseas “confidence” in Treasuries would be hurt without the administration’s steps to end the economy’s decline.

Japan, China

China held $696 billion in U.S. Treasury debt as of Dec. 31, more than Japan’s holdings of $578 billion. Foreign holdings of U.S. Treasury debt at the end of last year totaled $3.1 trillion.

The Treasury also offered a response that sought to reassure investors.

“The U.S. Treasury market remains the deepest and most liquid market in the world,” Treasury spokeswoman Heather Wong said in an e-mailed statement. “President Obama is committed to taking the steps necessary to restore growth and put this country on the path of fiscal sustainability, including cutting the long-term deficit in half over the next four years.”

During the first five months of fiscal 2009, which began Oct. 1, the U.S. budget deficit swelled to a record $764.5 billion for the period, compared with a $265 billion shortfall during the same period a year earlier. The shortfall this year already has exceeded the record $459 billion gap for all of 2008.

‘Stronger Position’

The administration is “tackling many long-ignored problems, ensuring that the U.S. will be in a stronger position than ever,” Wong said. “We are facing whatever challenges come up and will continue to do so.”

Treasuries have handed investors a loss of 2.7 percent in yuan terms this year, according to Merrill Lynch & Co.’s U.S. Treasury Master index. Chinese holdings of the securities surged 46 percent last year, according to Treasury Department data.

“Of course we are concerned about the safety of our assets,” Wen said after an annual meeting of the legislature. “To be honest, I am a little bit worried.”

Diversifying Reserves

China should seek to “fend off risks” as it diversifies its $1.95 trillion in foreign-exchange reserves, Wen said. Yu Yongding, a former adviser to the central bank, said in an interview on Feb. 10 that the nation should seek guarantees that its Treasury holdings won’t be eroded by “reckless policies.”

Treasuries have benefited from demand as a haven in the past two years as financial companies reported $1.2 trillion in credit losses. China boosted holdings of government debt as it lost more than $5 billion from investing $10.5 billion of its reserves in New York-based Blackstone Group LP, Morgan Stanley and TPG Inc. since mid-2007.

“China won’t sell the U.S. debt now as that will only drive down Treasury prices, hurting not only the U.S. but also the value of its own investments,” said Shen Jianguang, a Hong Kong-based economist at China International Capital Corp., an investment bank partly owned by Morgan Stanley.

U.S. Secretary of State Hillary Clinton urged China, while visiting officials in Beijing on Feb. 22, to continue buying U.S. debt, which she called a “safe investment.”

U.S. Treasury Demands Changes in AIG Plans for Bonus Payments

The U.S. Treasury ordered American International Group Inc., the insurer saved from collapse by taxpayer bailouts, to overhaul plans to give out multimillion- dollar bonuses and repay the government for some 2008 payments, according to a person briefed on the matter.

Treasury Secretary Timothy Geithner telephoned Chief Executive Officer Edward Liddy on March 11 to demand changes to AIG’s bonus payments, an administration official said separately.

AIG was rescued by the government in September after its bets in the derivatives market threatened to bankrupt the insurer.

Madoff Jailing Prompts Cheers From Investors in Courtroom

Dozens of investors, after hearing Bernard Madoff’s admission that he ran a $65 billion Ponzi scheme in which he lied and stole for decades, applauded in federal court in New York as he was handcuffed and led to jail.

Investors filled three rows of seats in Courtroom 24B, where Madoff said he was “deeply ashamed and sorry” for defrauding individuals, charities, trusts, pensions and hedge funds. At the hearing on March 12, U.S. District Judge Denny Chin asked victims to say whether he should reject Madoff’s guilty plea to 11 counts, including fraud, perjury and money laundering.

“If we go to trial, we will show people in this struggling country and the world who look to us as the global moral leader, that we will hold all people accountable,” investor Maureen Ebel told Chin. “We can show the world that all crimes, all crimes, including crimes of greed, can be dissected, ruled upon and punished.”

Ebel and two other investors spoke to Chin before he accepted Madoff’s plea and set sentencing for June 16, when he could impose a prison term as long as 150 years. The judge then revoked Madoff’s bail and ordered him to jail, prompting U.S. marshals to handcuff him and lead him out of the courtroom. Investors applauded and one said: “Bye, bye Bernie.”

At the start of the hearing, Assistant U.S. Attorney Marc Litt detailed the legal elements of each of crime, prompting a seated Madoff to interlock his fingers and look down.

‘Look at the Victims’

Chin then invited investors to speak. George Nierenberg stood at the podium and stared at Madoff, who wore a charcoal gray suit and tie, and rimless glasses.

“I don’t know whether you had a chance to turn around and look at the victims,” said Nierenberg, who took a step toward Madoff. The judge admonished Nierenberg to remain at the podium.

Madoff, whose silver hair was swept back, finally leaned back in his chair and cast a glance in Nierenberg’s direction.

Another victim, Ronnie Sue Ambrosino, said she objected to the plea, saying the judge had a chance to “find out information as to where the money is and to find out who else may be involved in this crime.”

After Ambrosino spoke, Ebel said: “At trial we can hear and bear witness to the pain that Mr. Madoff has inflicted on the young, the old and the infirm. No man, no matter who he knows or who he is able to influence, is above the law.”

Deeply Sorry and Ashamed

The judge said that victims couldn’t talk about what effect Madoff’s crimes had upon them.

“Victims will have a chance to speak at sentencing,” Chin said.

Madoff, who was arrested Dec. 11, spoke for the first time about his crimes. He stood at the defense table and spent about 12 minutes reading from a double-spaced typed statement.

“I am actually grateful for this opportunity to publicly speak about my crimes, for which I am so deeply sorry and ashamed,” Madoff told a hushed courtroom. “As I engaged in my fraud, I knew what I was doing was wrong, indeed criminal.”

Madoff described how he “deeply hurt many, many people, including the members of my family, my closest friends, business associates, and the thousands of clients who gave me money.”

At several points as he told of his deceits, Madoff blinked his eyes rapidly. Later in the hearing, he stood as Chin asked him how he pleaded to each of 11 counts filed by the U.S. Attorney’s Office in Manhattan. Madoff pressed his thumbs and fists into the defense table as he said “guilty” 11 times.

Victims’ Laughter

Chin rejected a request by defense attorney Ira Sorkin to allow Madoff to remain confined to his Manhattan apartment on $10 million bail, with a private security firm watching him. When Sorkin began to say that Madoff’s wife, Ruth, had paid for the guards with her own money, victims burst into laughter.

“Would the audience remain quiet,” Chin said.

After Madoff was led away, investors applauded. One said: “Thank you, Mr. Litt.”

Outside the courtroom, attorney Helen Chaitman, an investor who also represents 300 Madoff customers seeking to recover money, said she was glad to see him in person.

“He doesn’t have four heads,” Chaitman said. “It’s hard to imagine swindling his best friends. You can understand someone stealing from strangers. But you can’t understand someone stealing from their friends.”

Lost Millions

Several investors said they believe Madoff couldn’t have acted alone.

“I don’t think for a minute that he has any remorse,” said Bennett Goldworth. “He’s a psychopath.”

Goldworth, 52, said he invested with Madoff for about 10 years and lost 97 percent of his investment.

“I’ve lost millions,” said Goldworth, a senior vice president at the Corcoran Group, a real estate brokerage company. “I’m happy that he went to prison.”

Outside the courtroom, another investor, Adriane Biondo, said she and her family members were angry at Madoff.

“I think it’s quite appropriate that he goes to jail,” said Biondo, 41, a concert promoter from Los Angeles. She said some family members had been denied food stamps.

Asked if the guilty plea gave her a sense of vindication, she said, “I’m more interested in restitution.”

The case is U.S. v. Madoff, 09-cr-00213, U.S. District Court for the Southern District of New York (Manhattan).