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Business/Finance See other Business/Finance Articles Title: Stock Gumshoe discloses virus-based, anti-cancer drug being touted as big money maker There are some folks who are trying to make projections about what will be the leading cancer drugs in five years — they’re almost certainly going to be wrong, but their guesses provide a framework for thinking about scale. They think Revlimid will lead the pack with $10 billion in sales, and that others like Opdivo and Avastin will be in the $5-10 billion neighborhood. Revlimid is expected to hit $6.5 billion in sales this year (close to $6 billion last year), but it was first tested in the clinic in 2001 and approved by the FDA in 2005 after a very fast fast-track approval process… even with “fast track,” it takes time to build those big cancer drug franchises. CELG has, of course, been a fantastic investment for anyone who held it for the past 10-15 years — it is very reliant on Revlimid for sales, though it has other products, and it is running at about $10 billion in revenue per year and has a $75 billion market cap — so perhaps that’s the kind of model the newsletters are hoping to see replicated. The immunotherapy company they’re teasing is Kite Pharma (KITE), headed by Dr. Arie Belddegrun…who got his medical degree in 1974, and completed his residency at Harvard Medical School in 1985. “He’s also the director of the UCLA Institute of Urologic Oncology, Professor of Urology, and Chief of the Division of Urologic Oncology at the David Geffen School of Medicine. “But in addition to his many talents in education and medicine, he’s also an outstanding businessman. “When he’s not teaching how to perform surgery or running the cancer institute at UCLA, he’s using his free time to start lucrative cancer treatment biotech companies. And the tiny ‘startup’ company Dr.Belddegrun founded went up 415% just 6 months after going public.” So I won’t go any further in opining on KITE for you today, though I will note that this same newsletter has used different spiels to pitch this same stock twice in the past couple of years — first in October of 2014, then again about a year ago when Stephen Petranek was calling this the “iCells” cure for cancer. That iCells pitch was in June of 2015, and at the time they were predicting that you could get 1,782% gains in two years — they’re still using that same percentage, though now the returns are supposed to “start” on July 1. The only specifics I’ve seen about “July 1” in KITE’s info (I may have missed something) note that they expect their next pivotal data in the second half of 2016… and, of course, the second half of 2016 starts on July 1. It doesn’t end until December 31, for those who are calendar-illiterate, but, well, that’s all I’ve got for you. “ Poster Comment: Dr. KSS MD PhD says: I like $KITE and have a long position that’s in the green. I don’t think the profit projections are as rich as teased, but this company executes well and will likely get FDA approval for its first NDA. Its horizon is mostly limned by the unknowns CAR-T faces…and those include that CAR-T will be the province of the tertiary care center, will be high-priced, and will require aggressive peer to peer authorization. CAR-T will be last-line therapy, and still carries with it untamed toxicity potential. And it will be well over a year before CAR-T plays see the torrid fulminant valuations they had in 2Q15. While to many $KITE and $JUNO are bookends, to me $KITE is the hungrier, more aggressive company. To readers, I suggest considering having one CAR-T hook in the water: Cellectis, Kite or Juno are fine. No need to own ’em all. I’d second-tier Bellicum because of lack of uptake thus far of its methods, though bright they are. Teddi Knight says: The company has 185 employees and $19.5 million in revenue. Price to earnings is non-existent and earnings this year are negative $2.85 per share. Instead we can look at price to cash flow which is 128.3 times. Obviously this is a speculative trade. For those who like to gamble they may like this kind of stock, but overall these types of stocks can be portfolio killers for the average retail investor. If you want to gamble with money that you can afford to lose then I guess this is just another one of the hundreds of stocks that can be gambled against. Otherwise, there are far better companies that are on the forefront of real cancer break throughs like Bristol-Myers Squibb (BMY) which pays a sustainable dividend of $1.52 a share and trades at 77.1 times earnings (still high) and has revenue of $16.9 billion. Their drug for colorectal cancer has terrific results and it is just one of many such R&D endeavors they have ongoing. There is also the XBI ETF which covers Biotech stocks. So overall I would say who cares about KITE unless you like to gamble. I prefer to invest and BMY is one stock i have been in since 2011 and continue to trade. It remains in an uptrend for the 5th year. Teddi Knight fullyinformed.com Post Comment Private Reply Ignore Thread
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