By Michael Shulman, for
No. 1: CerusCerus ( CERS) developed and markets the INTERCEPT Blood System, which is designed to inactivate blood-borne pathogens in blood components so the blood can be used in transfusions. In other words, it "cleans" donated blood of viruses, bacteria and parasites. Cerus is pretty much the only game in town with this remarkable technology, and it has gained approval in most large European countries. Why not the United States? Well, management has not stood up to the FDA. The approval has been held up by one member of the FDA even though Cerus hit the primary endpoints in its pivotal Phase III trial and is receiving grants from the Department of Defense. The FDA should quit dragging its feet eventually. There is no scientific or product risk in this stock. Cerus' system works. My target price is $14 in one to three years.
No. 2: CurisCuris ( CRIS) has developed a series of cancer treatments based on a technology that disrupts intercellular signaling in the Hedgehog pathway. Disrupting communication disrupts cell duplication, the foundation of tumor growth. Curis has more than 20 trials under way with Genentech/Roche and the National Cancer Institute. This year, Genentech will likely report results of a basal cell carcinoma trial for skin cancer, and it has said it will go from this mid-phase trial directly to an application for approval if the results are strong enough. One success means a volcanic eruption in the stock, as it will prove the core technology is a viable platform for cancer treatments. A failure could put the entire program -- and the company -- in jeopardy. I believe the technology will be a success, which means this $2 stock could be worth $40-plus. If I'm wrong, you will probably be looking at a 50-cent stock. I'd say it's worth the risk.