5 More High Risk/Reward Biotechs For 2012

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 |  Includes: AMGN, ANIP, ARIA, BMY, MAPP, MRK, TEVA
by: Kinetic Investments

This article is to serve as a follow-up to last Monday's well-received list of biotech speculation plays for 2012.

As most knowledgeable biotech traders know, there are a lot of money-making volatility plays surrounding the FDA's decisions as to whether to approve or deny/delay approval for new drug candidates. It is common for investors to flock to or fly from stocks leading up to decision dates.

I have compiled another list of five 2012 biotech speculation plays and potentially undervalued stocks that have pending FDA decisions in the first half of 2012, including the product candidate name, approximate FDA decision date, current stock price and highest analyst price target. There are also links to the companies' respective pipelines.

1. Amylin Pharmaceuticals, Inc. (AMLN)

Amylin is set for an FDA decision on its product candidate, Bydureon, on 01/27/2012. Bydureon a glucagon-like peptide-1 receptor agonist, and would be the first once-weekly treatment for type 2 diabetes in adults. It delivers glycemic control in a single weekly dose. AMLN currently trades around $10.50 with the highest sell-side analyst one year price target being $25.

AMLN Pipeline

AMLN Pipeline

2. BioSante Pharmaceuticals, Inc. (BPAX)

BioSante has a scheduled FDA decision date for its product candidate, Bio-T-Gel, on 02/14/2012. The company is partnered with Teva (NYSE:TEVA) on Bio-T-Gel, which is a once-daily transdermal testosterone gel in development for the treatment of male hypogonadism, or low testosterone levels. In 2010, the transdermal testosterone market for men in the U.S. was over $1.2 billion. BPAX currently trades around $2.50 with the highest sell-side analyst one year price target being $6.

BPAX Pipeline BPAX Pipeline (Click to enlarge)

3. MAP Pharmaceuticals Inc. (NASDAQ:MAPP)

The FDA is scheduled to issue its decision on MAP's product candidate, Levadex, on 03/26/12. LEVADEX is self-administered using MAP Pharmaceuticals' proprietary TEMPO inhaler. It is a novel formulation of dihydroergotamine, a drug currently available in other dosage forms to treat migraine. MAPP currently trades around $13.75 with the highest sell-side analyst one year price target being $30.

MAPP Pipeline MAPP Pipeline (Click to enlarge)

4. Amgen, Inc. (NASDAQ:AMGN)

Amgen is set to receive word from the FDA about a new indication for its product, Xgeva, on 04/26/2012. Xgeva is a monoclonal antibody that is used to prevent bone fractures and other skeletal conditions in people with tumors that have spread to the bone. AMGN currently trades around $58.50 with the highest sell-side analyst one year price target being $75.

AMGN Pipeline AMGN Pipeline (Click to enlarge)

5. Ariad Pharmaceuticals (NASDAQ:ARIA)

Ariad's product candidate, Ridaforolimus, is scheduled for an FDA ruling on 06/05/2012. The company is partnered with Merck (NYSE:MRK) on Ridaforolimus, which is a novel small-molecule inhibitor of the protein mTOR that acts as a central regulator of protein synthesis, cell proliferation, cell cycle progression and cell survival in cancer cells. ARIA currently trades around $11.50 with the highest sell-side analyst one year price target being $18.

ARIA Pipeline ARIA Pipeline (Click to enlarge)

While there is no certainty that any of the above names will sink or soar next year, they all have the potential to move big in one direction or another. It should be noted that they all carry high risk potential but, if played right, the reward may be yours to have.

Disclosure: I am long ARIA, TEVA.