In what could be a very impressive week for Arena Pharmaceuticals (ARNA), as it awaits a decision from the FDA, regarding the company's obesity drug, there are two other pharma stocks that stand out in terms of potential upside with regard to a possible FDA approval. The share price, which in both cases is under $5/share, combined with each company's current pipeline, makes each play very reasonable at these levels.
Galena Biopharma, Inc. (GALE): Shares of Galena Biopharma closed up almost 2.6% at the close of Friday's trading session, making the stock very attractive at these levels. Trading in a 52-week range of $0.36/share and $3.54/share, Galena Biopharma has continued to trade positively since June 4. The company, which currently has four separate versions of its NeuVax (E75) drug and a single version of its Folate Binding Protein (E39) in its pipeline, has a primary focal point of cancer-based immunotherapies.
I think the focal point many investors should note, comes in the form of Galena Biopharma's immunotherapy process and how the process should be administered to potential patients. "Unlike existing monoclonal antibody therapy which requires frequent, ongoing, intravenous (I.V.) infusion, NeuVax can produce continuing activation of the immune system and therapeutic levels of Killer T-cells with a once monthly intradermal (under the skin) dosing schedule that is less expensive and more convenient for both the patient and physician".
That being said, I think Galena Biopharma presents potential investors with a great opportunity to establish a position. If the stock drops to $1.40/share or lower I would then begin to establish a medium position, and any drop below $1.30/share should lead investors to establish a much larger position. If and when NeuVax gets FDA approved, the stock will certainly trade much higher than at its current levels, making any time leading up to that announcement a good opportunity to establish a position.
Orexigen Therapeutics, Inc. (OREX): Shares of Orexigen Therapeutics closed down almost 0.25% at the close of Friday's trading session, making the stock very attractive at these levels. Currently trading in a 52-week range of $1.22/share and $5.14/share, Orexigen has been up roughly 2.5% over the last few trading sessions. The company, together with Takeda, is currently working on a naltrexone/bupropion solution called Contrave, in an attempt to get the drug approved by the FDA after it was originally denied in 2010.
The primary focal points for Orexigen happen to be obesity solutions similar to those of Arena Pharmaceuticals and Vivus (VVUS). Contrave, which can be broken down into naltrexone and bupropion, will serve as an obesity drug that regulates patients' appetite and will provide a better balance and distribution of energy for the patient. The company notes that the product will "reflect our understanding of how the brain appears to regulate appetite and metabolism, as well as the mechanisms that come into play to limit weight loss over time".
That being said, I think Orexigen presents potential investors with a great opportunity to establish a position. If the stock drops to $3.75/share or lower, I would begin to establish a medium position, and at any drop below $3.40/share, investors should begin to establish a much larger position. If and when Contrave gets FDA approved, the stock will certainly trade much higher than at its current levels, making any time leading up to that announcement a good opportunity to establish a position.