Nektar Therapeutics Building A More Exciting Pipeline

As Nektar (NKTR) has gotten investors more excited about its pipeline, including a somewhat surprising success with its late-stage pain drug NKTR-181, the shares have done all right since the fall of 2016 – rising more than a third since then (in line with the SPDR S&P Biotech (XBI) and ahead of the iShares Nasdaq Biotechnology (IBB)). The shares don’t look so undervalued to me now, but there are still multiple drivers in the queue for key pipeline candidates that could drive meaningful value.

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Nektar Therapeutics Building A More Exciting Pipeline

Seeking Alpha: Amicus Therapeutics Has Driven Value Through The Clinic

In prior articles on Amicus Therapeutics (NASDAQ:FOLD) I spoke of the significant value creation potential of successful clinical trials. If Amicus could show investors that its lead drug migalastat was both safe and effective as a treatment for Fabry disease, the market would reward the company with a substantially higher valuation.

That has happened. Data from the '012 study and additional extension data from the '011 study have established that migalastat offers comparable efficacy to enzyme replacement therapy (or ERT) and meaningful benefits to cardiac and renal function. While the path to FDA approval is still a little murky, investors should have more information relatively soon and I believe the odds now favor approval and commercial success - at least in a subset of patients with amenable mutations. Migalastat's future as a part of combo therapy is still uncertain, but offers further upside, as do clinical programs in Pompe's disease and MPS-1.

Amicus Therapeutics has risen more than 160% over the past year, but still looks undervalued on the basis of its market potential in Fabry disease. With a more convenient administration (it's an oral medication) and a potential safety benefit, there could be still more upside from pricing and/or market share. Value creation through de-risking the Pompe and MPS-1 programs is certainly still possible (positive data will support higher odds of regulatory/commercial success), but those events are further off.

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Amicus Therapeutics Has Driven Value Through The Clinic

The Motley Fool: AbbVie Inc. Wins the Shire

Pfizer couldn't bag AstraZeneca and Valeant is still trying win over Allergan's (NYSE: AGN  ) shareholders, but AbbVie (NYSE: ABBV  ) has managed to close its major deal. AbbVie and Shire (SHPG) announced on Friday that the companies had agreed to a merger that will see AbbVie acquire the Irish-based drugmaker on the previously announced terms of GBP 24.44 cash and 0.896 shares of AbbVie for each Shire share.

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AbbVie Inc. Wins the Shire

The Motley Fool: AbbVie and Shire Close, but Not There Yet

Patience and persistence on the part of AbbVie (NYSE: ABBV  ) may be close to paying off in its pursuit of Shire plc (NASDAQ: SHPG  ) . Shire's management has indicated that it can recommend AbbVie's latest offer, and it is an offer that still leaves some upside for AbbVie and its shareholders. It's definitely not a done deal though – not only might the two companies come to an impasse over "other items" still to be resolved, but now that the price is more or less set other bidders may jump into the fray.

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AbbVie and Shire Close, but Not There Yet

The Motley Fool: Will Shire's Journey End in a Ring?

"I should like to save the Shire, if I could," J.R.R. Tolkien, The Fellowship of the Ring.

British rare disease specialist Shire PLC (NASDAQ: SHPG  ) has become a hot property in this latest round of pharmaceutical merger mania. Not only does Shire offer a relatively low tax rate by virtue of its Irish corporate domicile, the company's focus on rare diseases fits in with the desire of many pharmaceutical companies to focus on therapeutic areas where reimbursement is high and the barriers to entry are substantial.

That Shire continues to get marriage offers is no guarantee that it will consent to do so. Not unlike AstraZeneca, Shire sees itself as a buyer, not a seller, and it may well take a prohibitively high number to seal a deal.

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Will Shire's Journey End in a Ring?

Seeking Alpha: Amicus Therapeutics Still A "Show Me" Story

When investors are keen on a sub-sector within biotech, as they have been relatively recently for immuno-oncology, RNAi, and liver disease, companies and their stocks often get the benefit of the doubt, with gaudy sales forecasts and approval odds well in excess of historical norms. On the flip side, and in a case like Amicus Therapeutics (FOLD), once investors have largely written off a company it can be very hard to regain their interest and confidence.

To be very clear, I believe Amicus still has a difficult road ahead of it. The data on lead compound migalastat are not clean and sufficient evidence of efficacy to drive approval (and/or market adoption) is no guarantee. Likewise, the company's 3-in-3 strategy to get three rare disease enzyme replacement therapies (or ERTs) into the clinic over the next three years is ambitious but high-risk. These shares do still appear to be undervalued, but I can frankly understand why many investors may conclude that there are better reward-to-risk opportunities elsewhere in biotech.

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Amicus Therapeutics Still A "Show Me" Story

The Motley Fool: Healthcare Buyout Mania: Now What?

It feels like there's nothing to talk about in the pharmaceutical space these days other than the latest M&A bid. Just in the last day and a half, investors have seen news on five completed or proposed transactions. And I doubt the deal-making is done.

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Healthcare Buyout Mania: Now What?

The Motley Fool: Can Allergan Remain Independent of Valeant?

Thanks to the now-public interest of Valeant (NYSE: VRX  ) in making Allergan (NYSE: AGN  ) its own, not to mention the vocal and financial support of Pershing Square and Bill Ackman, the status quo is gone for good at Allergan. Good first quarter results and improved guidance for the year were both nice to see, but Allergan is going to have to do a lot more to convince its shareholders that a plan for the future that excludes selling out to Valeant has their best interests at heart.

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Can Allergan Remain Independent of Valeant?

The Motley Fool: Can Allergan Find an Alternative To Valeant?

No one will accuse Valeant (NYSE: VRX  ) CEO Mike Pearson of lacking boldness. He has laid out a strategy for turning Valeant into one of the largest pharmaceutical/med-tech companies in the world and has proven more than willing to turn to bold M&A moves to make it happen. Valeant's latest move is far and away the largest – a $47 billion bid (at the time of the offer) for Allergan (NYSE: AGN  ) – but the target's acceptance is hardly a sure thing and the company's views about the pharma industry may give investors reason for pause regarding the long-term strategy.

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Can Allergan Find an Alternative To Valeant?

The Motley Fool: Will Shire PLC Build Or Buy Its Future?

The ideal in the biotech and pharma world may be for a company to develop a strong internal R&D engine that regularly churns out potential blockbuster compounds, but the reality is that most companies have to turn to partnerships and acquisitions to manage risk and maintain growth. Shire (NASDAQ: SHPG  ) built itself into a significant biotech/pharma company on the basis of strong internal CNS and rare disease R&D efforts, but has more recently turned to M&A to improve its prospects. With Shire likely to generate considerable cash flow in the coming years, the question stands as to whether investors would be better-served with additional M&A transactions or a reinvestment into its own internal R&D capabilities.

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Will Shire PLC Build Or Buy Its Future?

The Motley Fool: Can Alexion Pharmaceuticals Continue to Deliver?

Successful biotechs are generally expected to reinvest their profits into the development of broad pipelines, but Alexion  (NASDAQ: ALXN  )  is following a somewhat different path. While I do not mean to give short shrift to this company's pipeline development efforts, the fact is that Alexion has been more interested in maximizing the value of its blockbuster orphan drug Soliris than relying on new development projects. That strategy has served the company well so far, and while there may some reasons to question whether health care systems will continue to support such generous reimbursement for orphan drugs, Soliris could yet offer significant growth potential.

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Can Alexion Pharmaceuticals Continue to Deliver?

The Motley Fool: BioMarin Pharmaceutical, Inc.-- Is This Orphan Drug Specialist Overvalued?

It's not easy to develop treatments for rare diseases, but it is hard to argue with the rewards. Prior to its acquisition by Sanofi (NYSE: SNY  ) , Genzyme had already established itself as an important player in enzyme replacement therapies, and Shire (NASDAQ: SHPG  ) and Alexion (NASDAQ: ALXN  ) have both gone on to find meaningful success with treatments that serve tiny patient populations, but carry huge price tags.

BioMarin (NASDAQ: BMRN  ) very much deserves to be in this conversation, as the company has one of the broadest portfolios and pipelines for rare diseases. BioMarin's pipeline definitely has clinical risk and I don't think investors should just assume that payers will always go along with the pricing these companies want. The biggest issue may be overall expectations, though, as BioMarin is going to have to become extremely profitable and deliver exceptional revenue growth just to meet current expectations.

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BioMarin Pharmaceutical, Inc.: Is This Orphan Drug Specialist Overvalued?

Seeking Alpha: Amicus Takes A Certain Step Back For An Uncertain Step Forward

I'll happily grant that the best path between two points isn't always a straight line, but with all of the ups and downs (mostly downs) from Amicus (FOLD) over the past year, I can understand if investors no longer want to wait around to see if this recent strategic retrenchment proves a sound move for the long-term.

With lead drug migalastat unlikely to make it to market as a monotherapy, little data on combo therapy in Fabry's, and a one year delay in the Pompe program, not to mention Glaxo (GSK) bowing out of the migalastat program, bears have a lot to chew on. I'm somewhat more bullish on the acquisition of Callidus, though, and I think the market may be overlooking signs that migalastat could still be viable as part of a combo therapy. Amicus shares could still be worth as much as $4 today, but investors should note that this is a very high-risk/high-uncertainty opportunity.

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Amicus Takes A Certain Step Back For An Uncertain Step Forward

Investopedia: Can Sanofi Investors Just Blame It On Rio?

Sanofi (NYSE:SNY) was supposed to be a relatively solid Big Pharma company in 2013. True, the company is going through some pressures from patent expirations and internal drug development issues have created a soft spot for growth, but Sanofi's strong emerging market exposure was supposed to help, as was the fact that about one-third of the company's revenue comes from non-branded drug businesses.

Instead, Sanofi delivered a surprisingly large miss for the second quarter, a miss that means a little more in the typically more predictable Big Pharma space. While it may be true that problems in Brazil were a large part of the reported miss, worse than expected results in ex-Brazil emerging markets, vaccines, and animal health, coupled with higher than expected SG&A spending to support new launches, has reset expectations to a lower level. Although Sanofi shares are not overvalued today and the company could demonstrate fairly quickly that Q2 results were just an aberration, it's harder to make a forceful pro-Sanofi argument today.

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http://www.investopedia.com/stock-analysis/080613/can-sanofi-investors-just-blame-it-rio-sny-shpg-biib-amgn.aspx

Seeking Alpha: Don't Fold On Amicus Therapeutics Just Yet

It's hard enough to pick winners in biotech, but when companies try to explain away bad trial data with "don't look at that, look at *this*" post hoc analysis, all manner of alarms and sirens should go off in investors' heads. And yet, for every rule there is an exception, and I think Amicus Therapeutics (FOLD) may just be that rare exception. While I realize that hope and belief are more suited to theology than biotechnology, I do believe that Amicus's lead drug is effective and safe, and I hope that a 12-month follow-up of its pivotal study will be able to demonstrate that sufficiently for the FDA to grant approval.

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Don't Fold On Amicus Therapeutics Just Yet

Seeking Alpha: If Investors Won't Buy Shire, Big Pharma Should

Given the premium that Novo Nordisk (NVO) enjoys for its very strong position within diabetes care, you might think that a company with strong positions in two significant pharmaceutical areas would enjoy an even bigger premium. That's not the case for Shire (SHPG), though, and investors may have an opportunity here to take advantage of one of the few bargains in the pharma space. Moreover, with Big Pharma likely on the prowl for add-on deals, Shire's relative value may make it an appealing target.

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If Investors Won't Buy Shire, Big Pharma Should

Seeking Alpha: After The Twists And Turns, Sanofi Still A Value

It's been an interesting few days for Sanofi (SNY) and its shareholders. While the shares were thumped last week on what was seen as disappointing guidance, Monday saw a rebound on news of regulatory troubles at rival Novo Nordisk (NVO). Through it all, Sanofi still looks like a relative value and may in fact be one of the best bargains in the Big Pharma space.

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After The Twists And Turns, Sanofi Still A Value

Investopedia: Should Pfizer Forget R&D Altogether?

For quite a few years, I've been beating the drum that Big Pharma could not indefinitely cost-cut its way to prosperity. After all, if you fire all of the marketing reps and the scientists, you will certainly boost your margins, but where will tomorrow's growth come from? Pfizer (NYSE:PFE) clearly has some challenges ahead in refilling its pipeline, but perhaps more long-term value can come from pulling back on early-stage internal research and development (R&D), and using the money saved to buy compounds and companies that have already put in the time and money to show real promise.

A Surprisingly Strong Third Quarter 

A company like Pfizer shouldn't surprise people all that often (or by all that much), but surprise the Street the company did. Revenue rose 7% on a reported basis, and not only beat the average Wall Street guess by about 5%, but also surpassed the high end of the range. Real operating growth was a more sedate 1%, though, and U.S. revenue fell 3%.

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http://stocks.investopedia.com/stock-analysis/2011/Should-Pfizer-Forget-RD-Altogether--PFE-MRK-ABT-LLY-VRTX-CELG-SHPGY-FRX-BIIB1102.aspx

Seeking Alpha: Do Dendreon's Problems Matter To Your Biotech Portfolio?

There was no shortage of skeptics about the true market potential of Dendreon's (DNDN) Provenge cancer vaccine, but there were few credible prognosticators who predicted the magnitude of the disappointment in Provenge sales. What has been most interesting about the reaction to this shortfall, though, is how it blitzed the entire biotech sector. While the data gets sketchier the further back one goes, the post-Dendreon reaction Thursday (a bad day for the market overall), may have resulted in the worst single day in the history of the sector.

The question for investors, though, is whether or not the problems at Dendreon really have anything to do with their particular holdings. Though many investors may have sold their biotech stocks after the Dendreon news thinking that it's just too hard to figure out the eventual winners and losers (after all, FDA approval is supposed to the key to the vault), the reality is that nothing at all has really changed for the large majority of companies developing new drugs for diseases like hepatitis C, diabetes, or cancer.

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Do Dendreon's Problems Matter to Your Biotech Portfolio?

Seeking Alpha: The Storm Is Almost Over At Pfizer

It's almost hard to believe that Pfizer (PFE) carried a P/E ratio of more than 20 within the last decade. Generic competition has walloped many major pharmaceutical companies and Pfizer has responded in a pretty typical way – large-scale efficiency-driven acquisitions and significant internal cost-cutting efforts. And while it is true that no company on Earth has ever cost-cut its way into lasting prosperity, investors who may have once left Pfizer for dead as a no-growth has-been may want to take another look at this cornerstone member of Big Pharma.

Not Much Excitement In Q2
To be sure, there is not a lot going on in Pfizer's business today that should excite growth-oriented investors. Revenue was down about 1% as reported and down about 5% on a currency-adjusted basis as patent expirations and generic introductions continue to bleed away lucrative revenue. In fact, pharmaceuticals sales were down about 7% on an operational basis, with Pfizer's primary care business taking a 10% hit from generics.

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The Storm Is Almost Over at Pfizer