When New York-based pharmaceutical bag maker Protea Pharmaceuticals went public in 2012, it had a reputation for making innovative, low-cost medicines.
The company’s chief executive, Chris O’Reilly, had previously been an early investor in a startup called Cephalexico that made medical-grade medical devices.
In January of 2013, Proteas chief executive officer John Gailer announced that the company was looking to expand its product portfolio.
By then, the company had raised more than $1.6 billion in a public offering that closed in September.
The stock is now valued at more than half a billion dollars, according to data compiled by Bloomberg.
Since its IPO, the stock has soared, while its rivals have shed value.
“They were doing really well at the time and now they’re losing money,” says Mark Siegel, a former investment banker and CEO of Boston-based New Ventures Partners, which owns Proteaus shares.
“The stock is going up in a big way, but there’s also a big question mark about how much will the market actually be able to absorb.
The value of the company is really at risk.”
In the past few months, Protesa has faced more competition from competitors like Sanofi SA and Medtronic NV.
The three firms also have become more aggressive in their search for ways to make their products cheaper.
Sanofi has made an aggressive push into the biopharmaceutical market by acquiring companies like Biogen Idec Inc., which makes bioprocessing tools, and Novartis AG, which makes a cancer treatment called TDF, or Trinitrophenicol.
In June, Sanofi announced it would acquire another drug maker, Sanix Pharmaceuticals, for $7.6 million.
Last month, Saniquillum Pharmaceuticals said it was acquiring a company that makes a drug called BV-9-5, a drug used to treat a form of breast cancer called colorectal cancer.
And in April, Protekarma Pharmaceuticals announced it had purchased Sanix for $6.6 in cash.
“It’s a big change for a company to go from a drug maker to an industry player, and the companies are really trying to figure out how to go about that,” says Andrew Weisbrodt, an analyst at BMO Capital Markets.
Saniquilli also recently announced that it would be acquiring a drug company called Pfizer Inc. for $14.7 billion.
The price tag of the transaction was not disclosed, but it was estimated to be in the billions of dollars.
For Sanofi, the move to the biologics market has given the company a better chance of retaining investors, Siegel says.
For Proteans, the expansion of its product line has also led to an influx of new customers.
Since 2011, the drug maker has expanded its product offerings to include a number of different kinds of products, including blood thinner, immunotherapy and the treatment of diabetes.
The expansion of the product portfolio is also a boon to the company’s bottom line.
As more people take Proteos or other medicines, it is possible for companies to generate higher profits from their sales of their drugs, which helps Proteaa’s bottom lines.
San Diego-based Proteus is the only company in the world that makes blood thinners and other medicines.
In a 2014 article, Sussman wrote that Proteasex, the $4.8 billion deal with Sanofi in which the company agreed to acquire the rights to develop its blood thinning products, “is the best example of the kind of long-term synergies that can result when the company can focus on its core business and the underlying business of Proteia.”
In addition to its medical products, Protecas also makes other types of drugs, including the treatment for a rare, life-threatening form of brain cancer called Dravet syndrome.
In 2014, the Sanofi-owned company announced that its Dravets program would be expanded to include the treatment, a move that was announced at the end of June.
The deal was initially planned to take place in 2021.
Sani-Draetys, which has been in development for more than two decades, is expected to go into commercial development later this year.
Proteases price also is a concern for investors.
In 2015, Proto Pharma, a company owned by Sanofi that makes its own drug, sold its remaining stock for a record $4 billion, a record for a pharmaceutical company.
The move was part of a larger plan to expand the company.
Proto is also working to build a pipeline of medicines for a range of different diseases, including asthma, hypertension, depression and dementia.
The drug maker’s CEO, Eric Broussard, told investors in May that the drugmaker was making significant progress in developing medicines that would help improve outcomes for