3 Bio Tech Stocks Backed By Smart Money
ANX, DVAX, THLD – Bio Tech Stocks
Bio tech stocks and their respective companies focused on cancer treatments are some of the hottest acquisition targets in the drug industry, growing in value with novel drugs that have the potential for high price tags.
With Healthcare on the mend and starting to heal as the second half of 2011 gets underway, The motto goes something like this…”Think Tech, Not Big Pharma”…as in Biotech!
Typically viewed as a safe haven in tough times, the healthcare sector has been left in the dust of late as the broader market rallied.
With earnings season under way health care companies are still facing uncertainty around the health care reform passed by Congress last year, but analysts say 2011 may be better following 2010′s sharp under-performance, particularly in certain areas.
One such area is biotech. Large cap biotech stocks are trading at just 10 times forward earnings compared with 15 times for the S&P 500, says RBC Capital Markets analyst Michael Yee.
We anticipate bio tech stocks to outperform the broad markets in the back half of the 2011 calendar year with plenty of takeover press hitting the wires as well.
Why invest in Bio Tech Stocks now?
From a Risk/Reward Ratio…It’s obvious, to potentially achieve triple digit gains which is much more rewarding compared to 7 maybe 8% returns that most mutual funds may provide these days or sitting around waiting for dividend yielding large caps to reach fruition.
Many of the most undervalued small cap stocks to purchase at this time are located in Bio Tech stocks and their respective industry.
In a tough and turbulent market, it is very important to evaluate all indicators possible to become a selective, consistent winning stock picker. Even more so when the overall broad markets are “range-bound” as they have been for a few months now.
After four consecutive weeks of selling, equities seem to have found some solid ground to consolidate and potentially get ready once again for take off!
Small Cap stocks could be the place to be based on several cyclical standpoints. What are they you ask? Well, first and foremost let us start with the U.S. Dollar’ chart shall we. A true bottoming formation is in process of triggering on all fronts.
Russell 2000 806-812 offering heavy support now back over the neckline could drive a short squeeze to a All-Time High of 870.
Why not partake in bio tech stocks as a strong source of an a emerging growth sector at basement bargain price tags? In a comparative analogy, in order to make a good soup, you have to let it simmer abit. Our niche is to let stocks simmer until they trigger confirmed signals from an advanced chart and technical basis standpoint.
In turn, giving all traders and investors involved the best positioning that we feel could provide consistent winning trades.
While there are several honorable mentions that deserve immediate attention and research, there are countless investors on and off Wall Street that just don’t dig deep enough to uncover these potential money makers:
An emerging growth play penny stock that has been on the rise due to its PDUFA scheduled date of 9/1/2011.
Coming from the $1 region in upward of $3 where it has found a base after many analysts have put price targets that range from $7.50 all the way up to $16 a share for this cash cow ( $45 million of cash on hand, with zero debt and a tight structured float of roughly 20 million shares) has captured the attention of investors and traders alike at these cheap undervalued price tags.
Exelbine is the company’s proprietary emulsion formulation of vinorelbine. Vinorelbine is a vesicant and venous irritant, and these adverse effects can limit its tolerability.
ANX-530 was designed to be bioequivalent to the reference drug while reducing the incidence and severity of vein irritation associated with intravenous delivery of the drug. In a clinical bioequivalence study, ANX-530 and the reference drug were determined to be bioequivalent
The Function: FDA approval decision for ANX-530 (exelbine) in non-small cell lung cancer.
The Calendar: FDA is expected to make an approval decision date on Sept. 1.
The Endpoint: ANX-530 is a reformulation of the generic chemotherapy drug vinorelbine. The FDA issued a refuse-to-file letter for ANX-530 in 2010 prior to the $46 million raise and more clinical studies that have bode well from a safety standpoint.
About ADVENTRX Pharmaceuticals: specialty pharmaceutical company, focuses on in-licensing, developing, and commercializing proprietary product candidates for the treatment of cancer.
Its lead product candidates include ANX-530, an emulsion formulation of chemotherapy drug vinorelbine to treat advanced non-small cell lung cancer as a single agent or in combination with cisplatin, as well as to treat advanced or metastatic breast cancer; and ANX-514, an emulsion formulation of the chemotherapy drug docetaxel for the treatment of breast, non-small cell lung, prostate, gastric, and head and neck cancers.
Unlike many bio tech stocks that price in pending results as they approach, and sell off on the news, DVAX still has yet to price in the upcoming positive Phase 3 results. What you see in the options activity and volume is that upside move just beginning to start. Over the coming weeks we will see the price begin to move in anticipation of the announcement and shorts unwinding their positions.
If we get the news early before the stock prices it in, we will get an incredible surge to the upside in the matter of a day or two.
Smart money like Fidelity and others have already locked up their holdings, and whoever placed the half million dollar option bet knows something is coming to. So if you don’t have shares or were thinking of increasing your position for a double in DVAX, you might want to do it pretty soon if this is the type of investment that suits your needs and wants ofcourse.
About Dynavax Tech. Corp: Dynavax Technologies Corporation, a clinical-stage biopharmaceutical company, discovers and develops novel products to prevent and treat infectious diseases. The company’s lead product candidate includes HEPLISAVTM, a Phase 3 investigational adult hepatitis B vaccine designed to provide protection with fewer doses than current licensed vaccines.
It also develops Universal Flu vaccine, a preclinical vaccine, for the influenza prevention; SD-101, a Phase Ib hepatitis C therapy; DV-601, a Phase Ib hepatitis B therapy; AZD1419, a preclinical asthma therapy; and DV1179, a preclinical autoimmune and inflammatory disease therapy.
In the present, Threshold is focusing on pancreatic cancer, but the technology could be applied to many other types of tumors. TH-302 is still at least three years away from commercial launch.
It has shown clear efficacy in the first two phases of clinical testing (though Phase II testing continues), but the all-important Phase III trials are yet to come.
The Function: Phase II study of TH-302 in pancreatic cancer
The Calendar: Top-line results expected in the fourth quarter.
The Endpoint: After a previous pancreatic cancer drug failed, Threshold is back developing another drug known as TH-302. The phase II study compares TH-302 plus the chemotherapy drug gemcitabine against gemcitabine alone in patients with first-line pancreatic cancer.
The study is designed to show that the addition of TH-302 to gemcitabine can prolong the time before tumors start to grow.
About Threshold Pharmaceuticals: Threshold is a biotechnology company focused on the discovery and development of drugs targeting Tumor Hypoxia, the low oxygen condition found in microenvironments of most solid tumors. This approach offers broad potential to treat most solid tumors. By selectively targeting tumor cells, we are building a pipeline of drugs that hold promise to be more effective and less toxic to healthy tissues than conventional anticancer drugs.
Threshold Pharmaceuticals is developing an innovative hypoxia-activated drug, TH-302, for the front line treatment of pancreatic cancer. Hypoxic regions of tumors are areas where oxygen is deprived.
Most drugs have a hard time circulating in such environments. TH-302 actually prefers such an environment. Equally important, the drug leaves healthy tissue alone.
Three exciting Bio tech stock plays all trying to offer a major scientific break-through in the way we live and more importantly, prolong our lives and life-styles.
The bottom line is quite clear. Bio tech stocks and companies in this space need to consistenly focus on getting new products into the pipeline. Ultimately this is the key to raising the valuations for this group.
The Captain signing off for now…Stay tuned, stay healthy and stay onboard the StockRunway!
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