GENZ – Genzyme Corporation – Shares of the global biotechnology company rallied as much as 9.3% this morning to an intraday high of $54.49 on reports Sanofi-Aventis SA, France’s largest drugmaker, is getting ready to initiate a major $20 billion acquisition in the United States. Genzyme’s shares tapered off slightly by midday and currently stand 5.2% higher on the day at $52.41 as of 11:40 am (ET). Other biotech and pharmaceutical companies, such as Allergan Inc. and Biogen Idec Inc., experienced sharp upward shifts in share price as well as in options implied volatility following the news. Investors hoping Genzyme, the largest maker of drugs for rare genetic diseases, is the acquisition target purchased out-of-the-money call options on the stock. Call buyers are betting Genzyme’s shares will shoot higher if the firm turns out to be the apple of the French drugmaker’s eye. Traders picked up approximately 1,400 calls at the August $55 strike for an average premium of $1.59 apiece. Investors long the August $55 strike calls make money if Genzyme’s shares rally 8.00% over the current price of $52.41 to trade above the average breakeven price of $56.59 by August expiration day. Bulls also purchased 1,100 calls at the August $60 strike for an average premium of $0.63 per contract. Profits are available to August $60 strike call coveters if the biotechnology firm’s shares jump 15.7% to exceed $60.63 by expiration. Finally, options investors paid an average of $0.44 per contract to take hold of 1,200 calls at the higher August $62.5 strike. Individuals long the higher-strike calls profit if GENZ share price surges 20% over the current price of $52.41 to trade above the average breakeven point at $62.94 ahead of expiration day in August. The surge in demand for Genzyme’s call options coupled with uncertainty regarding which company will be acquired sent the overall reading of options implied volatility on the stock up 27.1% to 41.16% as of 11:55 am (ET).