Some investors consider the biotechnology sector as having too slow of a pay-off, in some cases taking 20 or more years to materialize. But focusing on biotechs that are projected for growth in the near term is one way biotech investors can see quicker gains. Today we focused on biotechs in this vein, by searching for those with growth on the horizon, indicated by a strong EPS rate, such as 25% and higher. Additionally, we narrowed our list of candidates by focusing on "cream-of-the-crop" companies, those that on average have scored a "Strong Buy" rating from biotech industry analysts. With these ideas in mind, we came up with an intriguing list of biotechs. Take a look to see if any of these stocks capture your interest.
EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-Year Expected EPS Growth Rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.
We first looked for biotechnology stocks. We then screened for businesses that analysts rate as "Strong Buy" (mean recommendation < 2). We then looked for businesses with estimated high-growth, with 1-year projected EPS growth above 25%. We did not screen out any market caps.
Do you think these stocks hold solid value? Use this list as a starting-off point for your own analysis.
1) Pain Therapeutics Inc. (PTIE)
|1-Year Projected Earnings Per Share Growth Rate||200.00%|
Pain Therapeutics, Inc., a biopharmaceutical company, engages in the development of novel drugs. Its lead drug candidate is REMOXY painkiller, a novel controlled-release oral capsule form of oxycodone in a viscous liquid formulation matrix that includes novel excipients. REMOXY is formulated to help address issues of abuse and misuse of time-release oxycodone tablets. The company's other product candidates comprise hydromorphone, hydrocodone, and oxymorphone, which are abuse-resistant opioid product candidates. Pain Therapeutics, Inc. has strategic alliance with Pfizer, Inc. under the King Pharmaceutical, Inc. agreements for the development of REMOXY, as well as hydromorphone, hydrocodone, and oxymorphone. The company was founded in 1998 and is based in Austin, Texas.
2) Cerus Corporation (CERS)
|1-Year Projected Earnings Per Share Growth Rate||31.60%|
Cerus Corporation, together with its subsidiary, Cerus Europe B.V., operates as a biomedical products company that focuses on developing and commercializing the INTERCEPT Blood System to enhance blood safety. The company's INTERCEPT Blood System is based on its proprietary technology for controlling biological replication and is designed to target and inactivate blood-borne pathogens, such as viruses, bacteria, and parasites, as well as potentially harmful white blood cells, while preserving the therapeutic properties of platelet, plasma, and red blood cell transfusion products. Its INTERCEPT Blood System for Platelets or platelet system is designed to inactivate blood-borne pathogens in platelets donated for transfusion; and INTERCEPT Blood System for Plasma or plasma system is designed to inactivate blood-borne pathogens in plasma donated for transfusion. The company is also developing INTERCEPT Blood System for Red Blood Cells or red blood cell system, which is designed to inactivate blood-borne pathogens in red blood cells donated for transfusion. It markets its platelet and plasma systems through its direct sales force and distributors primarily in Europe, the Commonwealth of Independent States, and the Middle East. The company has collaboration agreements with Baxter International, Inc. for the development and commercialization of the INTERCEPT Blood System; BioOne Corporation for the commercialization of platelet and plasma systems in specified parts of Asia; and the United States Armed Forces for the development of pathogen inactivation technologies for the improved safety and availability of blood. Cerus Corporation was founded in 1991 and is headquartered in Concord, California.
3) Zalicus Inc. (ZLCS)
|1-Year Projected Earnings Per Share Growth Rate||29.30%|
Zalicus Inc., a biopharmaceutical company, discovers and develops drug candidates focusing on the treatment of pain and inflammation. The company's clinical and preclinical product candidates include Synavive, a glucocorticoid prednisolone product candidate, which is in Phase IIb clinical trial for the treatment of rheumatoid arthritis; Z160, an N-type calcium channel blocker that has completed Phase I clinical trial to treat neuropathic and inflammatory pain; and Z944, an oral T-type calcium channel blocker, which is in Phase I clinical trial for the treatment of various chronic pain conditions, as well as sodium channels to treat acute and chronic inflammatory, and neuropathic pain. It has research collaboration agreement with Hydra Biosciences, Mallinckrodt Inc., and Amgen Inc.; research and license agreement with Fovea Pharmaceuticals SA and Novartis; and cooperative research and development agreement with the United States Army Medical Research Institute for Infectious Diseases. The company was formerly known as CombinatoRx, Incorporated and changed its name to Zalicus Inc. in September 2010. Zalicus Inc. was founded in 2000 and is based in Cambridge, Massachusetts.
4) Merrimack Pharmaceuticals, Inc. (MACK)
|1-Year Projected Earnings Per Share Growth Rate||51.40%|
Merrimack Pharmaceuticals, Inc., a biopharmaceutical company, focuses on discovering, developing, and preparing to commercialize medicines paired with companion diagnostics for the treatment of cancer in the United States. The company uses its proprietary Network Biology discovery platform to integrate the fields of engineering, biology, and computing to discover and develop therapeutics and diagnostics. Its product candidates include MM-398, a novel, stable nanotherapeutic encapsulation of the marketed chemotherapy drug irinotecan, is in Phase I and Phase II studies, as well as a Phase III study called NAPOLI-1 in 2nd line pancreatic cancer; MM-121, a fully human monoclonal antibody that targets ErbB3, a cell surface receptor implicated in cancer, is in multiple ongoing Phase I and Phase II clinical trials; and MM-111, a bispecific antibody designed to target cancer cells that are characterized by overexpression of the ErbB2 cell receptor, is currently in Phase I testing though though the company anticipates that it will enter Phase II testing in the near future. The company's products also include MM-302, a nanotherapeutic encapsulation of doxorubicin with attached antibodies that target the ErbB2 (HER2) receptor in Phase 1 clinical trial in patients with advanced ErbB2 positive breast cancer; and MM-151, an oligoclonal therapeutic consisting of a mixture of three human antibody antagonists, which is in Phase I clinical trial. It has collaboration and license agreements with Sanofi; Dyax Corp.; PharmaEngine, Inc.; Adimab LLC; and Selexis SA. The company, formerly known as Atlantic BioPharmaceuticals, Inc., was incorporated in 1993 and is headquartered in Cambridge, Massachusetts.
5) Cell Therapeutics, Inc. (CTIC)
|1-Year Projected Earnings Per Share Growth Rate||82.60%|
Cell Therapeutics, Inc. engages in the development, acquisition, and commercialization of drugs for the treatment of cancer. It is developing Pixuvri, a novel anthracycline derivative for the treatment of hematologic malignancies and solid tumors; OPAXIO, a chemotherapeutic agent that links paclitaxel to a biodegradable polyglutamate for treating ovarian, brain, esophageal, head, and neck cancers; Brostallicin, a synthetic DNA minor groove binding agent; and Bisplatinates, a platinum-based chemotherapy drug to treat various cancers. The company, in collaboration with Chroma Therapeutics, Ltd., is also engaged in developing Tosedostat, an oral aminopeptidase inhibitor. Cell Therapeutics, Inc. was founded in 1991 and is headquartered in Seattle, Washington.
*Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz on 08/24/2012.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.