Business Digest

BUSINESS DIGEST

July 27, 2004

In the Region

FDA approves liquid version of MedImmune drug

MedImmune Inc. said yesterday that the Food and Drug Administration has approved the liquid version of its successful drug Synagis.

Synagis, used to prevent serious lower respiratory infections in children, is a major source of revenue for the Gaithersburg biotechnology company. Last year, it generated nearly $850 million in sales.

Synagis' original formulation, approved by the FDA in 1998, is a freeze-dried preparation that is reconstituted with sterile water. MedImmune said the liquid formulation of Synagis is supplied as a sterile solution ready for injection, thus eliminating preparatory steps.

MedImmune plans to stop producing the original Synagis in October and start making its liquid successor.

Coventry Health's profit soars 32% to $84 million

Coventry Health Care Inc., a health insurer with headquarters in Bethesda, posted earnings yesterday of $84 million, or 93 cents per diluted share, for the quarter that ended June 30.

The results beat analysts' consensus estimates of 87 cents, and represented a 32.4 percent increase over the $63.4 million, or 70 cents a share, booked in the second quarter of 2003.

Revenue was $1.3 billion, up 19.2 percent from $1.1 billion in the quarter last year.

Coventry's shares rose $3.67, or 7.4 percent, to $53.30 yesterday. That's a new 52-week high.

Md. REIT moving to Neb., but CEO, CFO aren't going

Humphrey Hospitality Trust Inc., a Columbia real estate investment trust specializing in limited-service hotels, says it is moving to Norfolk, Neb., to lower operating costs.

The company will transfer its headquarters Aug. 15. George R. Whittemore, its president and chief executive, and Michael Schurer, its chief financial officer, treasurer and secretary, have elected to resign rather than relocate, the company said.

Paul Schulte, the company's chairman, has been chosen as the new president and chief executive.

Elsewhere

Existing-home sales rose 2.1% in June to highest level

Sales of existing homes rose 2.1 percent to a new record in June as rising mortgage rates prompted a rush by Americans to close deals before rates went even higher.

The National Association of Realtors reported yesterday that the increase in sales pushed the annual rate of existing home sales to an all-time high of 6.95 million units, beating the old record set in May of 6.81 million units.

The pace of home sales this year has surprised analysts, who had been predicting that sales would begin to slow, reflecting the fact that interest rates have started to increase.

Minorities, poor are found less aware of risk in ARMs

Lower-income and minority consumers are most likely to choose adjustable-rate mortgages (ARMs) over fixed-rate loans and appear to be unaware of the risks the loans pose when interest rates rise, according to a survey released yesterday.

By contrast, about two-thirds of those surveyed in the poll issued by the Consumer Federation of America said they prefer fixed-rate mortgages and appear to be aware of the risk of ARMs, the consumer group said.

Mortgage rates generally have been rising. Sales of existing homes rose 2.1 percent to a new record in June as ascending rates prompted a rush by Americans to close deals before rates go higher, the National Association of Realtors reported yesterday.

Adjustable-rate mortgages traditionally have been favored by more affluent consumers who can afford mortgage rate increases, the Consumer Federation noted. But ARMs now are chosen by more than 30 percent of homebuyers and some lenders are marketing them to all potential buyers, regardless of income or assets, the group said.

Ex-Tommy Hilfiger official heads Polartec's maker

A former executive with the fashion company Tommy Hilfiger U.S.A. was named yesterday as the top executive at Malden Mills Industries Inc., the century-old textile maker that recently emerged from a bankruptcy after surviving a devastating 1995 fire.

Effective immediately, Michael Spillane became chief executive and president of Malden Mills, which makes Polartec fleece for customers including Lands' End, the North Face and the Pentagon. The company's nine-month search for new leadership followed its emergence from bankruptcy in October.

The Chapter 11 bankruptcy case reorganized Malden Mills under the control of creditors, although Aaron Feuerstein, a member of the family that had run the 98-year-old company for three generations, remains a board member.

Feuerstein gained national renown for his decision to keep workers on the payroll after the December 1995 fire destroyed the company's main factory. Insurance covered just three-quarters of the $400 million in rebuilding costs.

Alcoa to fire 400, close plant in labor dispute

Alcoa Inc., the world's biggest aluminum producer, said yesterday that it will fire all 400 workers at its Wenatchee, Wash., aluminum smelter and plans no new offers after union leaders rejected a plan to restart the plant.

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