Celgene Corporation Climbs After Acquisition
Celgene Corporation (NASDAQ: CELG)
Celgene Corporation stock is up in a big way today after the company announced after hours Tuesday that it had acquired Receptos (RCPT). The deal was valued at roughly $7.2 billion or $232 per share in cash. The goal of the acquisition of for CELG to enhance its inflammation and immunology portfolio with implications for inflammatory bowel disease and multiple sclerosis treatments. In a statement, here’s what Bob Hugin, CELG CEO had to say about the acquisition…
“This acquisition enhances our inflammation and immunology portfolio and allows us to leverage the investments made in our global organization to accelerate our growth in the medium and long-term…”
Currently (11:42), CELG is trading at $134.66 per share after a gain of 9.61% so far today. Considering the reason for the climb in value, I’m not expecting a long term reversal anytime soon. So, now is the time to look for dips that may prove to be incredibly profitable buying opportunities.
ACADIA Pharmaceuticals Stock Is Back In Bullish Mode
ACADIA Pharmaceuticals Inc. (NASDAQ: ACAD)
ACADIA Pharmaceuticals stock climbed in a big way earlier this week after the company announced data from it’s most recent Phase 3 study looking into an experimental treatment for mid to mild atopic dermatitis. The company’s results proved to be incredibly positive, sending the stock up in a big way. However, we saw declines yesterday. Nonetheless, I explained that the declines were nothing to worry about as they were the result of normal market movement; and the stock proved me right today. ACAD is climbing back up today; currently (11:45) trading at $51.80 per share after a gain of 6.39% so far today. As I’ve mentioned in previous pots, given the reason for the uptrend, I don’t see a reversal in the near future for ACAD. So, if you’re not already in, you may want to consider looking for pull backs as entrance opportunities.
Gilead Sciences May Not Be Undervalued For Much Longer
Gilead Sciences, Inc. (NASDAQ: GILD)
Gilead Sciences has been one of my favorite stocks to follow for quite some time now. I’ve found it intriguing that here we have a company that maintains control over the HCV and HIV treatment markets. However, due to competition, investors are afraid to push the value up. So, the current PE on the stock is around 10; which means it is incredibly undervalued. However, GILD will be releasing its earnings report on the 22nd of this month. That’s when I’m expecting to see a major change in the valuation. Once investors realize that with or without AbbVie in the picture, Gilead is likely to profit, this one is going to rally. So, it may be a good idea to get this one in your profile before earnings as they are likely to prove to be a major catalyst.
MannKind Corporation Stock Upgraded…Finally
MannKind Corporation (NASDAQ: MNKD)
MannKind is another stock that I tend to watch closely. Although I’m not expecting to see major gains in the short run, the long run is quite a bit different. The reality is that the company will be starting the Direct-to-Consumer campaign for Afrezza; picking up sales and exciting investors relatively soon. Nonetheless, investors have kept this one at a low price. However, analysts like Vetr are starting to see the incredible upside potential in the stock. As a matter of fact, yesterday Vetr upgraded the stock from a “buy” rating to a “strong buy” rating with a target price of $6.59. With all of that being said, keep your eyes on this one as it is likely to produce big gains throughout the next several months.
Zogenix Stock Climbs On KOL Meeting
Zogenix, Inc. (NASDAQ: ZGNX)
Finally, Zogenix is up after the company hosted a KOL meeting yesterday that was well received among investors and analysts alike. As a result of the meeting Brean Capital analyst Difei Yang maintained a buy rating on the stock and raised the target price by $8. Here’s what Yang wrote…
“The meeting was divided into three sections: 1) Dr. Joseph Sullivan who is a Director at UCSF Pediatric Epilepsy Center and Associate Professor of Neurology & Pediatrics University of California, San Francisco, gave an overview of the disease state, disease incident and prevalence, symptoms, diagnosis, current treatment options and limitations; 2) Lieven Lagae from Pediatric Neurology University Hospitals KULeuven Belgium gave an in-depth overview of the clinical study he has conducted over many years in treating Dravet patients with low dose fenfluramine; and 3) there was a presentation from management which included an update from recent positive FDA interactions. Management guided for filing an IND by the end of August and re-affirmed earlier guidance to initiate two Phase III trials during Q4, 2015…
We revisited the assumptions we used to derive TP for ZGNX shares and thought some of the assumptions were too conservative, e.g., operating income margin for an orphan disease company like ZGNX. We had used the assumption of 35% which is in line with most of other specialty pharma companies, but lower than that for orphan drug companies, which typically is in the 50% range. In addition, we believe because of strong long-term clinical data on ZX008 as well as the fact that orphan drugs appear to have better R&D successes due to their highly targeted patient population, there is a lower efficacy bar due to lack of an alternative therapy. We revised our success rate for the pending pivotal trials from 70% to 80%.”
Do You Know Of Any Others?
Do you know of any other stocks in biotech that are well worth watching? If so, let us know in the comments below!