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News of Delayed Medicare Policy Spikes Keryx Biopharmaceuticals (KERX) Stock

By  +Follow March 26, 2014 2:20AM
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Shares in small-cap Keryx Biopharmaceuticals (KERX) showed strength on Wednesday, taking off about an hour after the opening bell and gaining nearly 20 percent. The massive spike, which took shares from $14.40 a share to over $16.85 from 10:26 am to 10:36 am ET by news that the "doc fix" bill includes language for Medicare to delay moving oral-only End-Stage Renal Disease (ESRD) Drugs into the ESRD bundle until 2024. Shares reached highs of $17.29 apiece by early afternoon and stayed above $16.50 for much of the day.

A note sent by Guggenheim Partners to clients at 10:20am included the revelation that the "doc fix" bill currently moving through congress includes a provision delaying the inclusion of ESRD drugs that don't have an IV alternative from the ESRD bundle until 2024. This 8-year delay for moving oral-only ESRD drugs into the bundle comes after a previous 2-year delay bumping the date to 2016 and should be a boon to those companies producing medications falling into the oral-only ESRD category.

The legislation, which has been subject to rushed negotiations as the March 31 expiration of a previous 3-month patch passed in December of last year fast approaches, is scheduled for a house vote tomorrow. Without this "doc fix," doctors participating in Medicare would get hit by a 24 percent reduction in their reimbursements, an ongoing issue that dates back to 1990s legislation targeting federal spending. House Speaker John Boehner stated at a Wednesday press conference that the short-term fix won't affect any negotiations on a long-term solution.

"That does not preclude any work from being done on the long-term fix in terms of how we pay doctors,” he said. “I think we need to take this step first.”

Keryx, which is developing KRX-0502 to treat hyperphosphatemia (an excess of phosphate), a disease common among patients suffering from chronic kidney disease, appears to be one of the companies that should benefit from the delay. The drug is what’s known as a “phosphate-binder,” a group of drugs that have been part of Medicare's focus on its policies for treating ESRD.

The Centers for Medicare and Medicaid Services (CMS) began shifting its PPS for ESRD drugs in 2011. The shift in policy means that payments from Medicare for ESRD treatments will now be “bundled,” offering a single payment through Medicare part B for the entirety of the treatment, including dialysis and oral drugs. This differs from the previous policy of certain medications related to dialysis treatment, like phosphate binders, being paid for separately through Medicare part D.

However, Keryx has a number of other fundamental and technical factors that could be driving the day’s gains. Certainly, the dramatic spike at 10:26 is most likely connected a specific news item, but the stock was up 2.3 percent prior to the big spike and appeared to be climbing. This could be attributed to a rash of “buy” ratings on the stock coming from nine different analysts, with the most recent from Mizuho on March 20 with a price target of $25 a share.

However, technical factors could also be what was driving the price up early and may also have contributed to the size of the big jump at 10:26. The stock had been trading in a fairly defined up channel since mid-October, with a rising support level that was moving largely in tandem with the 50-day SMA.

On March 19, though, the stock started a plunge that had it crossing its 20-day and 50-day SMAs and crashing through support. This selling spree ultimately resulted in a 14-day RSI of 35, where under 30 is traditionally viewed as a sign a stock is oversold, and a 14-day Stochastic RSI of 0.00, well below the 0.20 level traditionally viewed as an indicator shares are oversold.

As such, some rebound for Keryx seemed likely today regardless of any news items and technical factors could have provided additional upward pressure to the buying spree sparked by the rumors about Medicare’s policy delay.

 

Editor's note: Article has been editied since its initial publication. A previous reference to a tweet from Chad Fugere was removed after he contacted Equities.com to clarify the source of his information.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for KERX
Eli Pritsker
22 Oct 14 18:40:02
RT @const1969: jumping into bio tech today both large and small, $GILD, $ADXS, $ACHN, $ATRS, $BONE. $KERX, $KITE, $BIIB, take a look, growt…
Phil Martin
22 Oct 14 18:03:22
$KERX http://t.co/gATE5VwFG5
Stockaholics
22 Oct 14 14:39:02
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/H5HPSVIRF1 $YPF $KERX $ATSG
Stockaholics
22 Oct 14 14:09:56
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $TSL $KERX $GGAL
Homegameralert
22 Oct 14 11:38:31
look at buying quality stocks like $MSFT, $AAL, $DAL, $DOW, $MS, $CHK, $DO, $SONS, $MAS,$WY, $KERX, $MARVL,$AMAT,$BRCM, $KLAC, all good buys
crhz1978
22 Oct 14 10:44:05
$KERX getting ready to break out! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
Stockaholics
22 Oct 14 10:43:17
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $YPF $KERX $ATSG
crhz1978
22 Oct 14 10:39:30
$KERX rallying!!!! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
Billy Ray Valentine
22 Oct 14 09:01:48
$FMS should buy $KERX
crhz1978
22 Oct 14 07:01:52
$ARIA $AVNR $KERX all rallying!!! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
Homegameralert
22 Oct 14 06:45:53
jumping into bio tech today both large and small, $GILD, $ADXS, $ACHN, $ATRS, $BONE. $KERX, $KITE, $BIIB, take a look, growth and pipelines
C Mosseri Marlio
22 Oct 14 05:08:17
@PropThinker My point is that NCE is a shibboleth, as the $kerx price action justly reflects. You guys did a call on the IP, remember?
Stockaholics
21 Oct 14 22:15:34
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Stockaholics
21 Oct 14 21:46:31
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Joe McCann
21 Oct 14 13:30:54
@dcamtrades @BioBreakout $KERX too...
Stockaholics
21 Oct 14 12:52:27
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $YPF $KERX $ATSG
Stockaholics
21 Oct 14 12:30:15
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $TSL $KERX $GGAL
US_proptrader
21 Oct 14 12:24:37
$EGY $GCI $GLOG $GTI $HK $KERX $LPI $MHR $PKD autocharts @ http://t.co/hj7PGeTQk3
Hooligan
21 Oct 14 11:52:24
$KERX to the fool suggesting this ends up like AMRN, remember, theyve already secured their patent. Good-2-Go
DailyStockPicks
21 Oct 14 11:40:41
Earnings out for Owens Corning tomorrow. Is it due for a collapse? http://t.co/Est9NjxYUb $RNO $RFMD $DUST $KERX $LIVE $PSID $PLUG $ZGNX
Tyler Bryant
21 Oct 14 11:07:11
RT @US_proptrader: $APT $BABA $BCEI $CYTR $KERX $MNI $OWW $SUNE autocharts @ http://t.co/hj7PGeTQk3
US_proptrader
21 Oct 14 11:04:35
$APT $BABA $BCEI $CYTR $KERX $MNI $OWW $SUNE autocharts @ http://t.co/hj7PGeTQk3
Joe McCann
21 Oct 14 11:03:58
For those of you who like trends...Cards in that pile still public: $NPSP $KERX $IPN.PA $MSB.AX (Just funny, not me saying they are next!)
Homegameralert
21 Oct 14 08:51:38
strong movement in $KERX today, above all averages and should be very strong going into earnings in Nov, pipeline looks strong
Stockaholics
21 Oct 14 01:16:28
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $TSL $KERX $GGAL
Stockaholics
20 Oct 14 21:15:40
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Stockaholics
20 Oct 14 20:48:11
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $TSL $KERX $GGAL
NovaPharma
20 Oct 14 18:31:14
Some days it really is better to sit back and take some notes. $ARWR $KERX $HALO $TKMR $SPPI $OREX
Stockaholics
20 Oct 14 17:33:23
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $YPF $KERX $ATSG
Stockaholics
20 Oct 14 17:07:33
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Stockaholics
20 Oct 14 13:08:07
After Massive Gains On Penny Stock Picks, another New Pick Is Coming! Check it out: http://t.co/YX0NLZhRQ5 $YPF $KERX $ATSG
Stocks News&Markets
20 Oct 14 13:00:14
lx21 made $14,370 on $KERX -Check it out! http://t.co/GWYL9Regww Learn #howtotrade http://t.co/axK8SMSgo9 $VTAE $LEDS $ATRA $KWK $ONCY
Stockaholics
20 Oct 14 12:37:31
After Massive Gains On Penny Stock Picks, another New Pick Is Coming! Check it out: http://t.co/YX0NLZhRQ5 $TSL $KERX $GGAL
US_proptrader
20 Oct 14 12:07:12
$ACHN $ARWR $CAR $CIE $CPE $GLNG $HP $KERX $SD autocharts @ http://t.co/hj7PGeTQk3
crhz1978
20 Oct 14 12:05:22
$KERX SURGING!!!! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
US_proptrader
20 Oct 14 12:04:58
$KERX pop
Clair Voight
20 Oct 14 12:01:48
$KERX Keryx Biopharmaceuticals Enters Oversold Territory (KERX) http://t.co/B6dubz1MVO
Stockaholics
20 Oct 14 08:55:42
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Stockaholics
20 Oct 14 08:30:40
After Massive Gains On Penny Stock Picks, another New Pick Is Coming! Check it out: http://t.co/YX0NLZhRQ5 $TSL $KERX $GGAL
Stockaholics
20 Oct 14 00:27:26
After Massive Gains On Penny Stock Picks, another New Pick Is Coming! Check it out: http://t.co/YX0NLZhRQ5 $YPF $KERX $ATSG
Stockaholics
20 Oct 14 00:05:00
After Massive Gains On Penny Stock Picks, another New Pick Is Coming! Check it out: http://t.co/YX0NLZhRQ5 $TSL $KERX $GGAL
TickerChirp
19 Oct 14 20:32:03
The Top Tweets Concerning $KERX (Keryx Biopharmaceutical symbol KERX) on 10/20/2014 http://t.co/AnBk04Y01J
Stockaholics
19 Oct 14 20:07:13
IBIO Closed Up 69.84% After Our Penny Stock Alert! New Picks Coming: http://t.co/OG2rloNNni $YPF $KERX $ATSG
Stockaholics
19 Oct 14 19:43:18
IBIO Closed Up 69.84% After Our Penny Stock Alert! New Picks Coming: http://t.co/OG2rloNNni $TSL $KERX $GGAL
Stockaholics
19 Oct 14 17:24:12
IBIO Closed Up 69.84% After Our Penny Stock Alert! New Picks Coming: http://t.co/OG2rloNNni $YPF $KERX $ATSG
Stockaholics
19 Oct 14 17:01:57
IBIO Closed Up 69.84% After Our Penny Stock Alert! New Picks Coming: http://t.co/OG2rloNNni $TSL $KERX $GGAL
Matt finston
18 Oct 14 16:42:10
I own $kerx because of the damage I am doing to my kidneys thanks to #vitaminfizz $mine.
Stockaholics
18 Oct 14 11:50:21
IBIO Closed Up 69.84% After Our Penny Stock Alert! New Picks Coming: http://t.co/OG2rloNNni $TSL $KERX $GGAL
Dan
18 Oct 14 10:51:12
$KERX OI for maturity 10/18/2014. 16.00 Highest put. 16.00 Highest call. http://t.co/D2fmjqHSGV
Stockaholics
18 Oct 14 04:05:19
IBIO Closed Up 69.84% After Our Penny Stock Alert! New Picks Coming: http://t.co/OG2rloNNni $YPF $KERX $ATSG
				
				
By  +Follow March 26, 2014 2:20AM
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