*All content in this biotechnology blog represents the opinion of James O’Leary*
In recent weeks the biotechnology market has seen great changes, with the development of new medicines and medical software. The outcome has been an increase in interest in various companies and, by extension, an increase in the stock prices of these companies.
A large market is developing for drugs that fight cancer through using the body’s own immune system. Incyte has developed a medicine, called Epacadostat, which does that and which has caused quite a stir among investors and some of the biggest drug makers in the world. The exciting development of this new drug has resulted in Incyte shares increasing in value by 76% in the last year, while revenue has jumped from just $1.1 billion to $28 billion in the same time period. In 2017 alone Incyte stock has increased 36% in value, making it one of the S&P 500 best performers of 2017 within the drug sector.
(Please note: James O’Leary does not currently hold a position in Incyte. Henry James International does not currently own a position in Incyte for any client portfolios).
Also making recent waves in biotech news is Invitae who have announced that they are launching a platform on which patients will be able to anonymously upload their genetic information, initially focusing on the information of cancer-related patients. The idea behind the development of this database is that more readily available data will allow developers to make bigger advancements towards important medical discoveries. Following the announcement of this new platform, Invitae’s shares increased in price by 2.79%, closing on the 6th at $11.05, while year-to-date the company stock has experienced a gradual rise of 39.17%.
(Please note: James O’Leary does not currently hold a position in Invitae. Henry James International does not currently own a position in Invitae for any client portfolios).
The first product for treating the movement disorder Tardive Dyskinesia (TD) in adults has been developed by the company Neurocrine Biosciences. The announcement that the drug, Ingrezza, has been FDA approved was followed by a sudden 22% jump in Neurocrine stock prices, which closed at 24% on Wednesday 12th. At close on the same day Neurocrine’s shares were up 33% on a year-to-date basis.
(Please note: James O’Leary does not currently hold a position in Neurocrine Biosciences. Henry James International does not currently own a position in Neurocrine Biosciences for any client portfolios).
Other News in the Biotechnology Sector
Similar increases in other biotechnology companies have also been observed, according to Barrons, with iShares Nasdaq Biotechnology (IBB) shares having climbed 0.34%, Vertex Pharmaceuticals (VRTX) lifting 2.42% to $177, and Healthcare stocks increasing by 0.24%. Three companies in the biotech sector that investors should keep an eye on are Biogen (BIIB), Alexion (ALXN) and Gilead (GILD). Biotech Research Analyst Alethia Young from Credit Suisse has estimated that BIIB will report earnings per share (EPS) of $5.14 instead of the $5.02 that the consensus predicts, while revenue will be $2.79 billion rather than the average estimate of $2.75 billion. Likewise Young believes that EPS and revenue for GILD will be higher than consensus estimates, with $2.46 instead of $2.28, and $6.94 billion over $6.6 billion respectively. As for ALXN, it is predicted that it will meet expectations throughout the year, if not slightly exceed them.
Several biotechnology companies have seen increases in stock value as they have announced new developments and, according to Christopher Raymond, Senior Biotech Analyst and Managing Director of Raymond James, the commercial outlook for biotechnology is on the whole positive for 2017.
(Please note: James O’Leary does not currently hold a position in any of the companies mentioned above. Henry James International does not currently own a position in any of the aforementioned companies for any client portfolios).