Who Got Rich This Week: A $1 Billion Buyout and a Stock That's Up 550%

Jan 11 2014, 11:31am CST | by

Who Got Rich This Week: A $1 Billion Buyout and a Stock That's Up 550%

Each week at Forbes we scan our database of corporate insiders to see who got richer from the action in the stock market.

The new year is off to a cold start. And not just the weather; the S&P 500 has yet to return to its Dec. 31 high of 1,848 points and is down 0.33% through the first full week of the year. You can only blame so much on the Polar Vortex. Despite the chilly markets, two companies have made big moves already this year, minting millions for their owners in the process:

Biopharma bonanza

Investors have been in a tizzy over previously obscure drug-maker Intercept Pharmaceuticals. The company was up more than 300% in the past week — most of it coming in a monstrous stock pop Thursday. Account for Friday’s session, in which Intercept was up another 62% and trading at $445 per share, and the company is up 550% in 2014 with a marketcap of $8.6 billion.

What’s generating all the intrigue over this New York City-based developer of chronic liver disease treatments? As Forbes’ Brian Solomon reports, the company’s recent clinical trials of the drug obeticholic acid were stopped early after meeting its goals and proving its efficacy in treating nonalcoholic steatohepatitis (NASH), which can lead to cirrhosis and liver failure. As analysts have noted, approximately 22 million Americans suffer from NASH, and there is as yet no approved drug. With the worldwide rights to obeticholic acid aside from Japan and China — where they have other licensing deals — Intercept Pharmaceuticals is poised to make billions.

And that means a fortune for Intercept’s owners, too. The largest individual shareholder of Intercept is co-founder and CEO Dr. Mark Pruzanski, who holds 416,635 common shares that are now worth $185 million — up about $160 million since the stock surge began. Prior to founding Intercept in 2002, Pruzanski co-founded venture capital firm Apple Tree Partners in 1999, which focused on early-stage life sciences companies.

But the biggest Intercept beneficiary overall is Italian biopharma investment company Genextra, which owns a 30% stake in the company now worth about $2.6 billion — a $2.2 billion increase in the past week. Genextra, which is closely held, hasn’t disclosed its ownership structure, but it’s likely that Francesco Micheli, co-founder and chairman of Genextra and a former billionaire, and Dr. Lorenzo Tallarigo, Genextra’s CEO, have made a fortune off Intercept Pharmaceutical’s remarkable stock movement.

Catching Fire

When software security company FireEye went public in September, a very warm welcome from investors helped it close 80% above its IPO price and immediately made a fortune north of $400 million for founder Ashar Aziz, according to Forbes’ Tomio Geron. The company’s stock — and Aziz’s net worth — surged again this week after the company’s $1 billion acquisition of Mandiant. Also a security firm, Mandiant specializes in responses to network attacks and went viral last year after helping the New York Times reveal that Shanghai hackers affiliated with the China People’s Liberation Army committed cyber-attacks on U.S. corporations and government agencies.

FireEye, based out of Milipitas, Calif., offers more preemptive solutions and protection against malware and Internet attacks. With Alexandria, Va.-based Mandiant in the fold, the company now has both preventive and reactive services to sell its customers, an enticing convergence to investors. The company’s stock rose 41% the past week, now boasting a marketcap of $6.9 billion with shares changing hands at $57.

Aziz’s fortunes have likewise soared. The founder and chief technology and strategy officer, who worked for Sun Microsystems for more than a decade and had startup company Terraspring bought out by Sun in 2002, saw his 10.91 million common shares increase by $183 million to $632 million. Throw in vested options, and Aziz’ net worth is near $700 million.

Click here to see who got rich last week.

Thanks to Scott DeCarlo for building and maintaining our insider database screen.

Source: Forbes Business

 
 

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