This Day On The Street
Continue to site
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

6 Drug Stocks Unworthy of Biotech Bull Market

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

Galena Biopharma (GALE)

Stock return since Jan. 1: 168%

The prevailing "wisdom" seems to be that Galena is undervalued as a "phase III drug company" because investors have bestowed higher market values on other companies with products in late-stage clinical trials. Of course, this reasoning sidesteps the thorny question of whether or not Galena's "phase III drug" really belongs in a phase III trial. (At least, a phase III trial with a reasonable chance for success.)

The Galena drug in question is NeuVax, a cancer immunotherapy designed to stimulate the immune system in patients with breast cancer that express low levels of a protein known as Her-2. Similar patients who express high levels of Her-2 are typically treated with Roche's antibody cancer drug Herceptin.

Data from the NeuVax phase II study have been presented (and presented again) through so many updates and retrospective looks at various patient subgroups that the overall results -- NeuVax failed to significantly reduce breast cancer recurrence or improve survival -- have been virtually whitewashed. Instead, Galena pins its phase III hopes on assumptions culled from rosier retrospective looks at small subgroups of patients who were "optimally dosed" or who have low levels of Her-2 expression.

NeuVax isn't new. The therapy has been kicking around for years under the control of a private drug firm, Apthera, which conducted the earlier studies and drafted plans for the phase III study. Last year, RXi Pharmaceutical acquired Apthera in exchange for 4.8 million shares of RXi stock, worth a bit more than $7 million. At the time of the purchase, RXi had been focused (unsuccessfully) on developing RNAi therapeutics. RXi and its RNAi drugs are now gone, transformed into Galena with a more investor-friendly breast cancer immunotherapy moving into a pivotal phase III study.

How many high quality, late-stage cancer drugs get acquired for just $7 million?

Galena shares closed Tuesday down 20% to $1.01.
4 of 7

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
Only $9.95
14-Days Free
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
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BPAX $55.05 -1.24%
ENMD $0.90 0.00%
CYTX $0.32 0.00%
GALE $1.38 0.00%
REGN $376.71 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs