Agenus: Buy Or Ready To Bust?

Apr. 3.12 | About: Agenus (AGEN)

It may have been a rough day for Keryx Biopharmaceuticals (NASDAQ:KERX) on Monday after a late stage trial for the cancer drug Perifisone didn't quite pan out, but it was a money day for Agenus, Inc. (NASDAQ:AGEN) investors after the company announced that it would be presenting some positive trial data of its own at an upcoming conference.

Monday's announcement highlighted and followed-up on data presented at the 2011 American Society of Clinical Oncology (ASCO) Annual Meeting which showed that 93% of the patients from a Phase II Prophage trial were alive at the 26 week mark after surgery with a median overall survival of 11 months.

Progphage is AGEN's developmental stage immunotherapeutic cancer treatment for glioma.

In addition, the company announced that it would be presenting at the 80th American Association of Neurological Surgeons (AANS) Annual Scientific Meeting in Miami later this month.

Agenus has been back in the spotlight since late last year when news swirled regarding the use of AGEN's vaccine adjuvant QS-21 that is used in GlaxoSmithKline's (NYSE:GSK) malaria vaccine. That attention provided a foundation and a boost for the company's share price which has been on the move for the better part of this year since the expansion of an agreement with Glaxo included a 'first right of refusal' clause that would allow AGEN's larger partner to have first dibs at any of its technologies during any future partnership or buyout negotiations.

That announcement quickly threw AGEN on the radar as a potential buyout candidate and also told investors that this company may be for real again.

Agenus has more than tripled already since the beginning of the year and has offered investors multiple opportunities to play the runs and pullbacks. There is also a lot of hype surrounding the stock right now, with many stock market message boards going crazy with hype and very enthusiastic short term price expectations - price predictions that are not very likely to pan out anytime soon, barring an endorsement by the Pope proclaiming Prophage a miracle. At first glance that looks nice for the supporting argument of a continued price run, but after having already tripled, it also makes one wonder if this run can be sustained without the release of additional solid news.

After all, a stock can only move so much for so long on hype alone and it should make Spidey Senses tingle everywhere when a new slew of "investors" show up and proclaim a stock to be perfect, just as you know something is up when a 'get bash crew' shows up looking to take a stock down. A contributor to Seeking Alpha noted a significant amount of institutional sells involving AGEN over the last quarter as well, an indicator that some of the big boys may want you to be buying right now so that they can get out.

That said, AGEN has already returned bank this quarter, so it hasn't done too bad for many a Grey Goose budget. Enjoy.

A Phase 2 trial testing the Prophage Series G-100 vaccine in patients with newly diagnosed glioma is still ongoing.

Disclosure: No position.