Biotech Milestone preview (5): CELG

You guys already know how I feel about CELG as I talked on the company fundamentals on past several articles. CELG is reporting earning in early Feb and I expect some moderate EPS upside with upcoming earning. By the end of Q1, CELG is likely to get Revlimid approval in Europe with MM treatment and possibly with MDS treatment. Revlimid approval in MM is widely expected but faster than expected approval in MDS could fuel upside price movement. Long term, I continue to remain bullish on the company growth outlook although high price of the stock demands diligent investigation and analysis on the business outlook and drug pipeline story.

Description.

Marketed products include: Thalomid, a small molecule immunomodulatory drug (IMiD) marketed for multiple myeloma and other cancers; Revlimid, a 2nd generation IMiD marketed for MDS and multiple myeloma; Alkeran, an alkylating agent (L-phenylalanine mustard) marketed with GSK for multiple myeloma; Focalin/Ritalin products, which are CNS stimulants marketed by Novartis. Pipeline includes Revlimid entering phase III for CLL and NHL; Actimid (CC-4047), an IMiD in phase II for sickle cell anemia, myelofibrosis and solid tumors; CC-10004, an oral TNF-alpha inhibitor in phase II for psoriasis; Benzopyrans (CC-8490), Selective Estrogen Receptor Modulators (SERMS) in phase II with the NCI for glioblastoma; c-Jun N terminal kinase inhibitors in phase I and preclinical for inflammatory diseases and cancer; and SELCID's (Selective Cytokine Inhibitory Drugs) in phase I for asthma and psoriasis.

Milestone events.

YE06/1Q07: Possible interim data from ECOG E4A03 phase III trial with Revlimid in newly diagnosed MM January 2007: Revlimid EMEA approval for 5q- MDS
YE06/1Q07: Initiate Revlimid phase III study in non-5q minus MDS
1Q07: Submit protocol under SPA for Revlimid phase III registration study for NHL
1Q07: Initiate Revlimid phase III trial in R/R CLL
2Q07: Initiate Revlimid phase III trial in R/R NHL
YE06/1Q07: Initiation of Actimid phase II/III trials in myelofibrosis, small cell lung cancer, sickle cell anemia and beta thalessemia

My Take.

Where else can you find the better growth story in biotech? Revlimid takes the company into the hyper-growth stage over next 3 years. Potent pipeline reveals massive untapped market for the company. Afraid of high PE? Then take a look at PEG ratio. Have stomach ulcer medicine for intermittent volatility but the stock will reward you greatly if you stay with it. Another strong buy with $73 PT.


The current stocks in that I cover are: Filthy Rich Tech ideas (comprised of Openwave, Avid Technology, Tivo, IBM, and Research in Motion), Filthy Rich Biotech ideas (comprised of Amgen, Celgene, Genzyme, Isis pharmaceuticals, Alnylam pharmaceutical, and Protein Design Lab), Filthy Rich Financial ideas (JP Morgan and Goldman Sachs), Filthy Rich China ideas (Focus Media Holding and Ctrip.com), Filthy Rich Transportation ideas ( American Airline and Southwest Airline), and Filthy Rich Specialty Retail ideas (Peet's coffee)

Please check out the archives for past posting on individual stocks. Also analysis is available at www.investorhives.com under FilthyRich hive. Thank you for visiting my blog.