Bristol-Myers Squibb could be a big winner with a portfolio of cancer treatments under development that use a patient's own immune system to attack the disease, according to a Citi, which raised its rating on the drugmaker.
Analyst Andrew Baum expects that within 10 years, immunotherapy will form the backbone of 60 percent of all cancer treatment plans in the developed world. That compares with less than 3 percent today and potentially translates into revenue of more than $35 billion for the industry by 2023.
"Rapidly accelerating advances in immunotherapy make it a potential tool to transform a significant percentage of cancers into something akin to a chronic disease," Baum wrote Wednesday.
Bristol-Myers' drug portfolio puts the company in a position to capture a share of that market, and Baum expects its peak immunotherapy revenue to exceed $10 billion by 2022. He expects the Food and Drug Administration to approve the company's treatment, nivolumab, in late 2014.
Bristol-Myers said last month that the FDA granted nivolumab a fast-track designation for three tumor types: a form of lung cancer, renal cell carcinoma and advanced melanoma. Fast-track status gives companies extra meetings and correspondence with regulators throughout the review process, and it allows the drugmaker to submit data as it compiles it.
Baum raised his rating on Bristol-Myers Squibb Co. to "buy" from "neutral" and increased his price target to $55, from $33.
The company's stock climbed 74 cents to $44.80 Wednesday before markets opened. Bristol-Myers shares have advanced 35 percent this year.