The Zacks Analyst Blog Highlights:Baxter International, Nektar Therapeutics, Hill-Rom Holdings, NuVasive and Discover Financial Services

Nov 18, 2013, 09:30 ET from Zacks Investment Research, Inc.

CHICAGO, Nov. 18, 2013 /PRNewswire/ -- announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Baxter International Inc. (NYSE: BAX-Free Report), Nektar Therapeutics (Nasdaq: NKTR-Free Report), Hill-Rom Holdings, Inc. (NYSE: HRC-Free Report), NuVasive, Inc. (Nasdaq: NUVA-Free Report) and Discover Financial Services (NYSE: DFS-Free Report).


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Here are highlights from Friday's Analyst Blog:

Baxter Advances on Pivotal Study

Baxter International Inc. (NYSE: BAX-Free Report) revealed that it has completed enrolling patients in its Phase III PROLOG-ATE clinical trial evaluating the efficacy of BAX 855, an extended half-life, recombinant factor VIII (rFVIII) protein used for hemophilia A treatment. Following the announcement of the news, BAX shares moved up 2.6% to $67.60 on Nov 14.

Built on the same protein used in Advate [Antihemophilic Factor (Recombinant) Plasma/Albumin-Free Method], BAX 855 has been modified to include the PEGylation technology from Nektar Therapeutics (Nasdaq: NKTR-Free Report). The PEGylation technology is designed to extend the duration of activity of proteins in the body.

This pivotal trial intends to study the efficiency of the BAX 855 compound in lowering annualized bleed rates (ABR) when administered on prophylaxis and on-demand treatment schedules. Additionally, the trial will also assess its safety and pharmacokinetic profile. Management claims that no inhibitors or safety issues have been registered till date.

Upon successful completion of the trial, Baxter intends to file for regulatory approvals in late 2014 and plans to start a continuation study for all patients who will complete the Phase II/III study. Moreover, the company also plans to initiate a BAX 855 study among pediatric patients in 2014.

The Phase I trial analyzed the safety, tolerability and pharmacokinetics of the BAX 855 compound. Results demonstrated that the duration of activity of the drug in the body was roughly 1.5 times higher than the Advate. Moreover, no adverse clinical events were reported during the course of the trial.

Baxter's BioScience business processes recombinant and plasma-based proteins to treat hemophilia. Milestone achievement for pipeline products represents a significant opportunity for top-line growth for BAX.

In the last reported quarter, revenues from the BioScience segment increased 6% year over year to $1.6 billion. Hemophilia, the largest sub-unit, generated revenues of $851 million, up 9% from the prior-year quarter. Growth was driven by higher demand for Advate used in Hemophilia and Feiba, along with benefits from apt timings of international tenders.

Currently, Baxter carries a Zacks Rank #3 (Hold). Stocks that are performing relatively better in the medical products industry include Hill-Rom Holdings, Inc. (NYSE: HRC-Free Report) and NuVasive, Inc. (Nasdaq: NUVA-Free Report). Both of them carry a Zacks Rank #1 (Strong Buy).

Discover Allies with Smartlink

Direct banking and payment services company, Discover Financial Services (NYSE: DFS-Free Report), has entered into a strategic alliance with Smartlink Card Service JSC. Vietnam-based Smartlink is a well known domestic payments network in that country.

Pursuant to the agreement, cardholders of two out of three operating networks of Discover Financial namely The Discover Network and Diners Club International (DCI) will be able to access more than 16,000 ATMs in Vietnam. A network of local commercial banks will support this cardholder benefit.

As consumers will be able to use their cards at more cash access points, this partnership should help Discover Financial attract the technology-friendly crowd toward its products, thereby boosting Discover Financial's client base. This should boost the transaction volume of Discover Financial on the international domestic payment network, and consequently revenues of both the direct banking and payments services segments of the company.

Smartlink processes transactions connected to 51 banks and financial institutions, and supports 55 million local debit cards in the Vietnamese market. Discover Financial aims to utilize Smartlink's network to promote card-payment market development in Vietnam and allow Vietnamese banks to use Discover's payment products.

The aforementioned transaction fits in with Discover Financial's global expansion strategy of supporting growth of local leading international networks. Vietnam, being an emerging economy, provides payment processors with immense growth opportunities in the card-payment market. Discover Financial's presence in Vietnam will allow it to tap this opportunity and increase its global client base.

Discover Financial is working hard to establish a foothold in the international card market to enhance its global client base. The company added significant international networks to its existing Discover network since the acquisition of the Diners Club in 2008. The Aug 2013 Paydiant agreement and the May 2013 initiative with Ariba aimed at transforming B2B payments by eliminating paper transactions were undertaken with the same objective. These alliances should bolster the global client base of the company as these networks combine the world's leading web-based trading communities with industry-leading cloud-based applications.

Discover Financial currently carries a Zacks Rank #2 (Buy).

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