Vertex Has the Potential to Go Vertical

NEW YORK (TheStreet) -- After the entire biotech sector posted more than 60% gains in 2013, which more than doubled the performance of the S&P 500, there's little debate that biotech stocks were among the Street's favorites last year. In 2014, however, this means there are very few biotech bargains left. Yet Vertex Pharmaceuticals (VRTX) seems to fit that bill.

As intimately as I've followed this sector last year, I still can't forgive myself for passing up on this company. What I notice now is a company with a strong and distinguishing product portfolio that has the potential to dominate its market. And with a bit of luck in clinical trials, the company will be able to generate close to $6 billion to $10 billion in annual revenue.

Vertex's key drug is Kalydeco, used to fight cystic fibrosis in a relatively small group of patients with a specific genetic mutation. Unlike older drugs which only treat the symptoms of cystic fibrosis, Kalydeco is revolutionary because it addresses the underlying condition of the disease. Even better, the company's is making progress on developing additional cystic fibrosis drugs, which will be used in combinations to benefit larger groups of patients with other genetic mutations. What I like best about Vertex is that the company has the potential to corner the market for the treatment of a disease that is still lethal and remains one of the most common chronic lung illnesses in children and young adults.

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