Serono retains Merrill buy rating

Merrill Lynch reiterated its buy rating for Serono SA after learning that the company will pay $704 million to resolve the U.S. investigation into Serono growth hormone Serostim. The investigation was initiated in 2001 following FDA approval in 1996 to use the drug in treating AIDS wasting.

Analyst Erica Whittaker said this plea agreement ends the uncertainty that was a potential overhang for Serono's share price and set a price objective of $19.60.

Shares of the Geneva, Switzerland-based biotechnology company were down $0.34, or 2.06%, at $16.13 on volume of 63,800 shares versus the three-month running average of 93,071 shares.

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