Total Medical costs over last 10 years and total BIO Pharma company revenue. I'll bet it shows massive growth in Total Medical Costs then less growth and flat growth as BIO Pharma Revenue increases. If you put some advanced analysis on this - I'll bet you will see the relationship in out-years showing BIO Pharma growth actually lowering medical costs - which proves a very basic point about this industry. Then you stack the 2 costs together and hopefully see the net costs are lower. This is true even with a massive influx of medical care. In other words Bio Pharma is massively critical/important industry now and going forward. I.E. a good investment - for the right reasons.
Agreed. Hold a ton of bios and will do so until the day I die. Buy on dips, every chance.
thanks .. celg is an exception to whats going on with - gild and abbv in terms whats products it has specialty medicines as opposed mass hep c drugs duplicatable by other big biotech /pharma houses
CELG's pipeline is impressive but I don't think CELG has the emerging T-Cell cancer curing type in clinical trials such as JUNO / NVS. Based on what I read in CELG's website, CELG drug has to be taken together with chemotherapy.
We made the following changes to the Equity Core and Equity Growth Portfolios at the close of business on December 23, 2014:
Health Care: We are removing our 3.0% position in Gilead (GILD, $89.48, B-3-9) after our analyst’s downgrade to Underperform. In its place, we established a 3.0% position in Celgene (CELG, $107.04, B-1-9), a profitable biopharmaceutical company that develops and markets therapies for the treatment of hematologic malignancies, solid tumors, and inflammatory conditions. CELG's key growth driver and contributor to the top line is Revlimid for the treatment of multiple myeloma and myelodysplastic syndromes. We anticipate continued strong growth for Revlimid, driven by share gains, longer duration of therapy and label expansions. CELG has several catalysts on the horizon, including the expected approval of Revlimid for multiple myeloma in the front-line setting in both the US and EU (currently approved for the treatment of relapsed/refractory multiple myeloma) and the potential settlement of the ongoing Revlimid patent case with Natco/Actavis. We view a settlement as favorable for CELG if the company concedes 1-3 years of patent life, as it removes a significant overhang on the stock. CELG is one of the highest growth companies among the large-cap biotechs―we expect compounded annual revenue growth of 20% and EPS growth of 28% over the next three years. Further commentary on Celgene may be found in the 2015 Healthcare year ahead, where Celgene is identified as a top pick
Baird "Everybody Just Chill. Significant Overreaction CELG, etc....We would be buyers...ESRX ABBV deal read through is thin...significant barriers in oncology..temporary setback-Buyers on weakness.....
December 24, 2014
Baird Equity Research
Healthcare / Life Sciences
Everybody Just Chill
Remain constructive on biotech, and while we can’t ignore the sentiment overhang, we are hard-pressed to see how ESRX’s most recent salvo against GILD’s HCV franchise constitutes a wholesale, across-the-board challenge to the pricing power enjoyed by meaningfully differentiated, life-saving therapies. Indeed, with NBI correcting 6% the last two days, we see a significant overreaction in shares of ALXN, BIIB, CELG, GILD and REGN.
Would be buyers of all five large-caps and mid-caps BMRN and VRTX on weakness.
o Express Scripts: flying like an eagle? More like take the money and run. As one of North America's largest PBMs, ESRX enjoys significant market power. However, ESRX CMO Steve Miller’s recent commentary implying this power will extend to therapeutic categories like MS, rheumatology, oncology, cardiovascular disease and even Alzheimer’s (really?) seems premature at best, reckless at worst. For our part, while we anticipate a longer-lasting GILD overhang, read-through is less straightforward, creating near-term buying opportunities. Three points:
- Unprecedented GILD/ABBV price war may not be unprecedented, or a price war.
With ESRX making some noise in respiratory and diabetes this year, this move on HepC does have precedent and, we note, was well telegraphed. Now however, we're also getting mixed messaging about how steep a discount Abbvie is really giving ESRX. Viekira list price was actually higher than most estimates so it’s possible the net price is in-line with pre-approval expectations.
- Read-through is thin. CELG, REGN, BMRN, and VRTX are down 9%, 8%, 5% and 4%, respectively, the last two days, largely we believe, on Dr. Miller’s commentary. However, in each case, we think this read through is misplaced with significant barriers in oncology; already well-known equivalence for PCSK9s; and long-standing US/ex-US pricing parity among Orphan drugs.
- Let’s stop a minute and think about ESRX’s motivations here. ESRX makes money by taking a share of the discount they get their clients. Discount rates being equal, they make more money the bigger the sticker price. So while there is an incentive – and opportunity - to create competition in undifferentiated markets, this model has limits since a total collapse serves no one, and undifferentiated markets are pretty uncommon te,in biotech.
n Bottom line: this too shall pass. Similar to this spring (when Henry Waxman opined on GILD’s Sovaldi pricing), the sector is taking a significant, yet – in our view – temporary step back. Buyers of ALXN, BIIB, CELG, GILD, REGN on weakness.
n Baird does not provide research coverage for ABBV or ESRX
Agreed Gerry, I started my position in Celgene in 2009 and have been adding to my position as the story of the business has evolved. -Added a small % to my portfolio yesterday. Celgene has good product lines (w/ good margins and moats (patents)) and management has done well in executing their business plans. They have solid core products that are expanding, have relatively new launched product lines that are growing rapidly, and other promising products in development (some with small start-ups). Their P/E is attractive for a growth company.
I usually don't post on these boards, but I wanted to provide my "elevator speech" to hopefully provide insight to new investors. BTW, investor buy businesses and traders try and guess which way the stock price will move. It should be called a "market of stocks and not a stock market." -forgotten reference.
Good luck to all,
Don't just do something. Stand there!
Unfortunately the traders of ETF's, that hold huge % of CELG, do not really care about Revlimid. As a result we suffer in the short term with GILD. These are not investors but short change artists that over react to any news.
how about this prospect for gsk?
=== GlaxoSmithKline, NewLink Genetics—The drug makers received $43 million in U.S. government funding to help fund faster development of two vaccines for Ebola.
your investing/trading approach is exactly like mine
i have a long term account to stash good companies on sale for long term prospect
i have a trading account to trade the very same companies day in and day out while keeping the core positions in long term account: baba, fb, bidu and many others (no biotech or pharma companies yet)
recently have my eyes on biotech for the past several days as shares are cheap during this rout
will come back to regn at pull-back (patience is a good virtue)
havent touched your celg yet ... still watching alxn ...
like abbv (due to gild rout) and isis (drug pipeline line-up)
GSK is a train wreck. Poorly managed and no growth. They cant seem to fight their way out of a wet paper bag. They spend tons of money on dividends and buyback and nothing on growth. Tons of Debt and nothing to show for it. I worry about ABBV too since Humira is 60% of sales and will go off patent in 2017. ABBV still has time to try to make up that revenue with new drugs or acquisitions though.
I hold both Core and Trade positions. When you buy a stock you have to decide if it will be Core or a Trade. Sometimes their in the same company and sometimes they are in separate companies. Right now I have a Core position in CELG and ALXN which I wont sell. I also have a Trade position in CELG which I bought at $85 on Oct 15. I have had trade positions in REGN and GILD before, but their not Core positions. Usually I buy them if they get too cheap to ignore. If you have a profit in a Trade position and sell it, never second guess a profit. But, then again, never turn a Core position into a trade.
i still hold abbv and isis since i like their prospects better
recently look at gsk at 52-week low for a pharma play = any suggestion?