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Biotech Stock Mailbag: Vivus

"Pump and dump." That sounds about right.

It should be very clear to anyone who spends an hour tops digging into Cel-Sci's fundamentals, including the appallingly sparse data supporting the company's head-and-neck cancer drug Multikine, that this company is a running joke. No one other than penny stock day traders is seriously interested in Cel-Sci. Have fun with Cel-Sci if trading penny stocks is your thing (and say hello to Timmy Sykes for me). Otherwise, stay away.

Via Twitter, @DLesh asks, "Is Pops going to hit big for me with Vivitrol? I am long and strong Alkermes (ALKS - Get Report)."

I like Alkermes, although I like the stock a lot more when it was trading at $10 this past spring than I do now that shares are around $14.

The "Pops" @DLesh mentions is Alkermes CEO Richard Pops, who gets two backslaps from me. First, for being one of the only biotech/drug CEOs on Twitter (follow him @popsalks); and two, for the overwhelmingly positive vote last week from the FDA advisory panel which reviewed the company's Vivitrol opioid therapy for the treatment of opioid addiction.

Well done, Senor Pops!

I have reasons to be less bullish on Alkermes at $14: Can Alkermes turn Vivitrol opioid into a successful and profitable product? Vivitrol for alcohol addiction has not been a moneymaker for the company. The new opioid addiction indication should garner more acceptance from addiction treatment specialists, but is that enough to make the product a meaningful growth driver?

Alkermes still derives the bulk of its revenue and stock market value from the royalties on Risperdal Consta sales received from Johnson & Johnson (JNJ). However, Consta sales and growth are under pressure from other newer schizophrenia drugs, including J&J's once-monthly version of Risperdal.

Lastly, Alkermes' stock price could get another a short-term bump if FDA approves the diabetes drug Bydureon on Oct. 22. (Alkermes will receive royalties on Bydureon sales.) Bydureon's commercial prospects, however, are up in the air because competition in the so-called GLP-1 market is fierce.

Looking further ahead, watch Alkermes' internal drug pipeline. Pops has the company working on some interesting projects. Right now, investors aren't paying much attention or giving Alkermes credit for the work, which is mostly in early stages.
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