3 Biotech Stocks Investors Should Pick Up in May

3 Biotech Stocks Investors Should Pick Up in May May 17, 2016
By Alex Keown, BioSpace.com Breaking News Staff

NEW YORK – On the hunt for a biotech stock to add to your portfolio this month? Analysts at The Motley Fool selected three stocks investors should consider to add to their investments.

Anika Therapeutics

Fool’s Brian Feroldi touted Bedford, Mass.-based Anika Therapeutics for its profitability and growth, as well as its osteoarthritis drugs, Orthovisc and Monovisc. The company just won European and Canadian approval for Cingal, a combination treatment for knee pain associated with osteoarthritis. Cingal is a combination of Monovisc and triamcinolone hexacetonide. The company is also studying Monovisc in a late stage trial for the treatment of osteoarthritis in the hip.

In its last quarterly reports, Anika saw its revenue jump 44 percent to $22.3 million. Feroldi said another sign that Anika is a good buy is the fact the company is “well capitalized with $116 million in cash and no debt, and it is even in the middle of an accelerated $25 million share repurchase program.”

“Anika Therapeutics is cash rich, in growth mode, buying back stock, and trades at a compelling price. That makes its shares a buy in my book,” Feroldi said.

Shares of Anika are down this morning, trading at $44.50 per share.

Vanda Pharmaceuticals

Cory Renauer touts Washington, D.C.-based Vanda Pharmaceuticals as his stock to buy based on its schizophrenia drug that is pending before the U.S. Food and Drug Administration. The new drug will expand Vanda’s schizophrenia drug Fanapt “from the acute setting to long-term maintenance treatment,” Renauer said. Fanapt, which was approved in 2009, accounts for about 60 percent of the company’s revenue. The FDA is expected to rule on the drug’s expansion by May 27. On Dec. 22, 2015, the European Medicines Agency (EMA) accepted the company’s Marketing Authorization Application for Fanaptum tablets for schizophrenia. Fanapt is approved in the U.S. for schizophrenia in the acute setting, as well as in Israel and Mexico.

“Adding proof that Fanapt can effectively reduce the rate of relapse as a long-term maintenance treatment should boost the company's top line significantly,” Renauer said.

Vanda also markets Hetlioz, a melatonin receptor agonist approved by the FDA in 2014 for the treatment of Non-24-Hour Sleep-Wake Disorder, and was accepted in 2015 in Europe to treat Non-24 in totally blind adults. It is also soon going to start a Phase III trial of Hetlioz for jet lag.

Shares of Vanda are up this morning, trading at $8.83 per share.

Amgen

Cheryl Swanson, a contributor to the Motley Fool, said “investors more interested in long-term growth and relative safety shouldn't miss the current opportunity in Amgen .” The company is supported by its blockbuster rheumatoid arthritis drug, Enbrel, which generated $1.39 billion last year, 24 percent increase. Amgen is also supported by Repatha, a PSCK9 inhibitor which lowers bad cholesterol. One thing that may boost sales of Repatha much higher is results from a long-term clinical trial to see if Repatha can prevent heart attacks. If Repatha demonstrates a “statistically significant advantage in terms of reduced risk of death,” it will encourage a large number of physicians to prescribe the medication despite the higher price point for the drug. Amgen also has a diverse pipeline with nine biosimilar molecules. Amgen has the potential to launch five of its biosimilars between 2017 and 2019. The most advanced is ABP 501, a biosimilar for Humira.

Shares of Amgen are slightly down this morning, trading at $151.38 per share.

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