Biotech-Stock Mailbag: Amgen, MiddleBrook

Seattle Genetics is also a cash-burning, mid-cap biotech stock with a relatively immature R&D pipeline. Unfortunately, this descriptor seems to be what matters most to investors in a bear market, hence the reason for the stock's 28% fall this year.

I've talked previously about how tough it is to own biotech stocks like Seattle Genetics in this biotech-hostile market. Management is executing well, the drugs and technology have potential, the biggest player in the biotech cancer market (Genentech) has jumped aboard; yet none of these positives seems to matter.

If and when the market turns around and investors get excited about biotech again, Seattle Genetics should get its share of the limelight. When will that happen? I have no idea.

Seattle Genetics will also help itself when it or partner Genentech moves a drug into pivotal phase III studies. The biggest knock on Seattle Genentics is that its drug development program moves deliberately, which is a nice way of saying it's slow.

So for now, all there is to do is track the company's progress and have patience. I'd pay attention to two drugs in particular. First, there is SGN-40, the monoclonal antibody under the Genentech agreement, currently in phase II studies as a treatment for non-Hodgkin's lymphoma and multiple myeloma. New data should be presented in December at the American Society of Hematology meeting.

Second is SGN-35, another drug targeting blood cancers, but this one fuses a monoclonal antibody to a tumor-killing payload. (Think "smart bomb" for cancer.) There are other companies with so-called antibody drug conjugate technologies, including Immunogen (IMGN Quote - Cramer on IMGN - Stock Picks), which also partners with Genentech.

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