Over the past few years, Keryx Biopharmaceuticals (KERX) has been working on new anti-cancer drugs aimed at stopping the spread of several types of cancer including colorectal and myeloma. These drugs, specifically KRX-0401 (perifosine), are still in Phase 1, 2 and 3 trial phases, could benefit patients by reducing the rate of cell deterioration and encouraging cell regrowth. From an investment perspective, these drugs could prove very profitable - especially if they are effective in treating different types of cancer.
Keryx, currently trading around $5 per share (up from an average $2.50 in 2011), is a good bet for those aggressive investors out there looking for a quick turnaround on their investment. Pharmaceuticals is a risky area and not for the shy investor, but the payoff can be great, especially if a drug does well in the marketplace and is accepted as a viable form of treatment for a life-threatening condition or disease such as cancer. The company typically does a good job of promoting new drugs, but there is a downside here - patents for perifosine are due to run out in 2013. However, according to The Motley Fool, the company has been seeking renewal for its 'key composition patent, which would run through 2018.
Being an innovator in the marketplace is what makes this company worth investing in. The company is currently the leader in the development of life saving drugs. And while there is no published evidence perifosine will be effective in treating and possibly preventing certain types of cancer so far, investors need to think 'outside-the-box' because once this drug enters the market, stock prices could soar very quickly. The company plans to release the drug at a lower price initially to encourage sales and to encourage people to talk about it (this could definitely help promote sales). This is why getting in early may prove to be profitable for savvy investors. Unfortunately, there is no word yet on a release date, but perifosine is being tested in several Phase 3 trials under Special Protocol Assessment (SPA) agreements with the FDA - which is a good sign that it will be approved quickly.
Keryx has a market cap of $360.09M with an annual daily volume of 3,163,191. Other drugs the company is currently testing include ZerenexTM (ferric citrate), for patients in end-stage renal disease. This drug is currently in Phase 3 trials in both the United States and Japan. Again, there is no published data as to the effectiveness of this drug to stop the disease from progressing rapidly or to stop it from progressing entirely, but like perifosine, it is under Special Protocol Assessment agreements with the FDA as well.
Other pharmaceutical companies developing new drugs that could potentially be profitable to investors include Medivation (MDVN) which has a market cap of $2.71B with an annual daily volume of 750, 494. Medivation stocks typically open around $75 per share. Last year, the company released a 'dimebon' drug that was supposed to help those with Huntingdon's disease, but failed to have any real effect for patients. The drug was then used to treat Alzheimer's, but also failed to have any real effect. This was very disappointing to Huntingdon's and Alzheimer's patients and to investors as well. This is a good example of the risk investor's face when putting their money into pharmaceuticals. Unfortunately, until a drug is used on a wider variety of people, you just never know how well it's going to do.
Myriad Genetics (MYGN) has a market cap of $1.97B with an annual daily volume of 2, 468, 981. This company's stock typically opens at $23.00. This company also released an Alzheimer's drug called Flurizan, but this drug didn't have much effect on those afflicted with the disease. The company, however, managed to recover some of its loses by selling European marketing rights before the drug entered the US marketplace earning roughly $100 million.
Curis (CRIS) has a market cap of $357.33M with an annual daily volume of 728,181. Curtis released Everidege, used to help treat carcinoma, which are cancerous cells that grow in different areas of the body. What's strange is that after the drug was approved by the FDA, company stock prices actually fell. It is unclear if investors just didn't see the drug's value or if they thought it would underperform and got skittish.
Arena Pharmaceuticals (ARNA) has a market cap of $543.07M with an annual daily volume of 6,078, 224. The company recently announced that its latest drug, Lorcaserin, to be used to help people maintain better weight control, will receive review by the European Medicines Agency (EMA). This means their Marketing Authorization Application (MAA) was approved as this is the first step of the review process. This is good news as weight control drugs and other treatments are usually popular with the public. The company also stated that the FDA will also review the drug for possible release in the United States. From an investment prospective, being approved in both the US and Europe could increase sales and generate even more profits.
When investing in pharmaceuticals, it's important to understand the risks involved. Some drugs, while they perform well during clinical trials, may not sell well or be well-received by the public. If they aren't buying these drugs, then profits go down for everyone - from companies to investors. Being approved by the FDA and other medical safety boards is essential for a drug to reach the masses. If investing in pharmaceuticals, keep your eye out for approvals by the FDA and other agencies. Remaining cautious is best when investing in brand-new medications.
From a risk perspective, given that Keryx has gotten cooperation from the FDA concerning clinical trials, investing in KRX-0401 (perifosine) and ZerenexTM (ferric citrate) may be worth it in end as long as you monitor stock prices closely. Pulling out as soon as the stock takes a dip may save you money and prevent you from losing everything at once. But if you're a gambler, these two drugs may be well worth your investment.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
