HALSEY DRUG SPARKS MORE THAN "GENERIC" INVESTOR INTEREST IN APRIL, LEADS INDEX

Hints of potential acquisition moves and a strong financial picture contributed to a 1-7/8-point April stock market gain for generic drug manufacturer Halsey Drug. After trading in the upper 3-point range since the beginning of the year, Halsey finished April at 5-5/8 a share, up 50% from the March 31 close. In the first week of April, Drexel Burnham was appointed as Halsey's financial advisor. On April 14, A.M.A. Financial Corp. revealed that it has accumulated a 7.2% stake in the firm (364,500 shares), which added to investor interest. Halsey has been pursued by suitors before. Early last year, the 44% insider-owned company turned down an unsolicited $ 14.3 mil. from the Tempo Group for around $ 3 a share. This time, however, the tables are turned. Halsey said it hired Drexel to explore the purchase of other generic firms; Halsey is not on the block, a spokesperson said. In fact, in late January, the company disclosed it had acquired a 6.5% stake in wholesaler Moore Medical "for investment purposes." Interest in the stock also was fueled by the generic drug marketer's financial strength and steady sales growth. An April 18 Investor's Daily article ranked Halsey the number one generic in terms of total earnings-per-share rank and relative price strength. On April 27, Halsey reported a 31.7% first quarter sales gain to $ 5.3 mil. and a 129.2% earnings rise to $ 486,000. The increases marked a continuation of the double and triple-digit growth the Brooklyn-based firm experienced for most of last year. 1988 annual sales reached $ 17.7 mil. Halsey's April performance also may have benefited from the fact that the firm has remained above the fray in the ongoing congressional investigations into generic drug approvals. Halsey is a newcomer to the "F-D-C" Monthly Index; the stock was added to the index in February. The company's 50% stock price rise in April led a pack of 35 gainers among the 62 issues tracked by the "F-D-C" Index of O-T-C and AMEX stocks, which advanced 4.6% for the month. That gain compares to the Dow Jones Industrials' 5.5% increase to 2,418.8 and the Standard & Poor 400's 5% gain to 356.7. The Index presented a mixed bag in April: joining the 35 advancing stocks were 23 decliners and four stocks that finished the month unchanged. Beecham, the most heavily-weighted diversified stock, gained 6.3% on a 1- 1/4 point rise reflecting investor approval of the offer for SmithKline Beckman and the perception that the British firm may be in play until that deal is consummated. Among other pharmaceutical stocks, Elan was up 1-1/4 points to 14-7/8. The Mayo Clinic Smoking Cessation Center announced April 28 that initial tests on Elan's Nicolan transdermal nicotine patch showed that 77% of those using the patch stopped smoking compared to 39% who used a placebo patch. The biotech firm Chiron also gained 1-1/4 to 19-1/2, but Xoma dropped 1-1/4 to 15-3/4. In late March, the company filed the much-awaited PLA for Xomen-E5 -- a monoclonal antibody product for septic shock. Chart omitted.