On December 17th, 2008, GlaxoSmithKline signed an agreement with Dynavax (DVAX) in which Dynavax received $10 million, with the potential for $800 million in payments from GlaxoSmithKline under a deal to develop autoimmune and inflammatory disease treatments. The agreement gives GlaxoSmithKline an exclusive option on four Dynavax programs focused on diseases including lupus, psoriasis and rheumatoid arthritis. Along with the agreement Dynavax will conduct research and early clinical development at which point, GlaxoSmithKline can exercise its exclusive option and license each program going forward. When the deal was announced shares of Dynavax (DVAX) surged higher going from $0.26 on December 16th to a high of $1.74 on December 17th on almost fifty-times Dynavax’s normal trading volume, suggesting investor appetite and approval for the deal going forward. However, as the global economy and capital markets went into basic free-fall starting late December, investors seem to have forgotten about Dynavax (DVAX), their agreement with GlaxoSmithKline, and the potential the stock offers. As of Wednesday Dynavax was trading at for $0.59 cents per share, had a current market capitalization of $23.5 million dollars, $64.26 million dollars in cash sitting in the bank and no debt on its balance sheet, which equates to roughly $1.62 in cash per share---282% lower than were the stock is currently trading for. Currently, Dynavax has 6 drugs in their pipeline: 1) Heplisav: Dynavax’s key hepatitis drug which showed positive results in phase III testing. 2) HCV: Hepatitis C drug which is in phase I testing. 3) HBV: Hepatitis B drug which is in phase I testing 4) Flu Vaccine: Which is in preclinical testing 5) Asthma: Which is in preclinical testing 6) Autoimmunity/Inflammation: Which is in preclinical testing. Half of Dynavax’s drugs are focused on the Hepatitis market, which reinforces GlaxoSmithKline’s efforts to improve the company’s product offering to the Hepatitis market going forward. Additionally, GlaxoSmithKline also owns www.hepatitisbhelp.com which is one of the largest hepatitis based websites in the world. On March 18th 2008 Dynavax dropped north of 50% after the FDA put a clinical hold on a late-stage trial for its Hepatitis B vaccine Heplisav. Dynavax and its co-partner Merck (MRK) said that one patient out of a twenty-five hundred person study outside of the U.S. was diagnosed with an uncommon disease causing blood vessel inflammation. The study did indeed met its final endpoint goals, showing that Dynavax’s Heplisav had a 95.1% positive result, compared with 81.1% with Engerix-B---a leading hepatitis drug in the space. It is important to point out here, that the FDA halted the trial because of one single patent out of 2,500, and that Dynavax more than adequately met its endpoint goals. Dynavax, which believes it already has the additional information the FDA is requesting will likely file the data shortly, with an FDA review sometime in 2009.

GlaxoSmithKline (GSK) is shopping for value these days; we want to follow their lead. They made some very intriguing deals and acquisitions last year expanding their product and pipeline in the biotechnology space, picking up Sirtris Pharmaceuticals for $720 million early last year, and are in the process of buying Genelabs Technologies for $57 million dollars. GlaxoSmithKline has about $9 billion dollars in cash and an additional $35 billion dollars each year in gross profit.

: Last week Agrium (AGU) offered $3.6 billion in cash and stock to shareholders of CF Industries (CF), one of America’s largest nitrogen, and phosphate producers. At the time of the offer, Agrium offered $76 dollars per share to CF shareholders, which represented a 37 percent premium over the company's $55.58 closing price as of Tuesday of last week. Additionally, Agrium noted that it expects the merger between Agrium and CF to have revenue of $14 billion and noted the transaction offers shareholders of CF Industries an annual savings of $150 million in terms of strategic synergies.

CF Industries (CF) is in a hostile takeover of Terra Industries (TRA), a pure play on methanol products for agricultural and nitrogen.

Dow Chemical and Rohm & Haas, which will face off in a Delaware court next Monday to determine whether Dow must complete its $78-a-share deal to acquire Rohm & Haas, are engaged in talks to find a resolution to their dispute, CNBC has learned.

Dow Chemical and Rohm & Haas, which will face off in a Delaware court next Monday to determine whether Dow must complete its $78-a-share deal to acquire Rohm & Haas, are engaged in talks to find a resolution to their dispute, CNBC has learned.

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