This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Biotech Stock Lessons From 2013 J.P. Morgan Healthcare Confab

BOSTON ( TheStreet) -- The 2013 J.P. Morgan Healthcare Conference is in the books. Here's what I learned:

Investor mood was bright, not unexpected given the biotech sector's relative outperformance in 2012. The conference failed to produce any headline-grabbing news and no major deals were announced (unlike last year) but that didn't seem to bother anyone.

Dig a bit deeper, as I did, and you definitely heard concerns about an inevitable correction in biotech stocks. No one was predicting when the sell off would occur, just that it was going to happen. Biotech short sellers believe the momentum of the past year is unsustainable, and quite frankly, absurd. Those investors who favor the long side agreed that a repeat of 2012 was unlikely but they also see the sector on healthier footing. A correction, when it happens, is an opportunity to buy quality biotech stocks at more attractive valuations.

Among the big-cap biotechs, Celgene (CELG - Get Report) emerged from J.P. Morgan as the big winner. The stock is already up 23% this year, outperforming Gilead Sciences (GILD), Amgen (AMGN) and Biogen Idec (BIIB). While 2013 earnings guidance was in-line with Street expectations, Celgene offered for the first time 2017 guidance of $13-14 per share -- a big number and impressive growth for a company its size, if accurate. The Celgene growth story has traditionally revolved around the multiple myeloma drug Revlimid, but not so much for 2013, 2014 and beyond, with Pomalyst (pomalidomide), Abraxane and apremilast stepping up in big ways.

Gilead's hepatitis C drug pipeline is moving steadily toward phase III data later this quarter and regulatory filings in the second quarter. No surprises. An interesting tidbit from Gilead's breakout was management mulling a phase III study of its newly acquired (from YM BioSciences (YMI)) myelofibrosis drug CYT387 pitted directly against Incyte's (INCY) Jakafi.

"We're good at head-to-head comparison studies, said Gilead President John Mulligan.

I admire that "go big or go home" attitude. Let's hope we see a CYT387 vs. Incyte study started later this year. Meantime, during its breakout, Incyte executives trashed CYT387, calling the drug a weak competitor that's too far behind to matter. Sounded to me as if Incyte was running scared.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AMRN $2.41 6.64%
CELG $118.68 0.87%
SPPI $6.00 0.92%
SRPT $13.57 3.83%
VVUS $2.57 3.21%


DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs