Celgene Sell Off “Overdone”
Laura Joszt | Friday, June 22, 2012
While Onyx Pharmaceuticals is flying high on good news for its blood cancer drug, Celgene wasn’t quite so lucky. Celgene’s stock took a big hit on Thursday when it withdrew its application for Revlimid. And by the end of the week, the stock hadn’t recovered much.
When the European Medicine’s Agency (EMA) indicated it wanted more data on Revlimid’s application to be used on newly diagnosed multiple myeloma patients and as a maintenance therapy, Celgene withdrew the application. When news broke, its stock dropped 11.65% at the opening bell on Thursday.
By the end of the day Friday, the stock had only recovered slightly, up 3.68%, but still down by 8.19% over where it had closed on Wednesday afternoon.
However, investors might be a little trigger happy with Celgene. For one, the company could still resubmit to EMA. Also, a trial combining Onyx’s Kyprolis with Revlimid and Dexa revealed that patients had a 98% response rate and a 92% progression-free survival rate.
Revlimid is already an approved blood cancer drug — the company is simply looking to expand its use. Plus, the drug could also have a number of other uses, such as lymphoma and CLL. Another Celgene drug could be approved for a second use this year.
According to SeekingAlpha, the sell off could nicely benefit investors who take advantage of it to buy up shares. Robert W. Baird released a note that it believed the sell off was overdone. The wealth management company has set a price target at $78.
The information contained in this article should not be construed as investment advice or as a solicitation to buy or sell any stock.