Marcial: Pharma Firms May Vie for Vertex

Expect merger-and-acquisition activity to heat up in the biotechnology sector. That's the prognostication of many analysts who have become more upbeat about the industry, with share prices now outpacing most other small-to-mid-cap stock groups.

The Nasdaq biotech stock index gained 3.15% in the week of Sept. 14, vs. the broader Nasdaq composite index's 2.50%, notes Simos Simeonides, senior biotech analyst at investment firm Rodman & Renshaw (RODM), who believes the biotech rally will likely persist this year. Both the profitable biotech companies as well as those that are still trying to develop and produce drugs for approval by the Food & Drug Administration have been gaining ground, he adds.