2 Fast-Rising Biotech Stocks With No Competition in Sight

Published: Jul 20, 2017

2 Fast-Rising Biotech Stocks With No Competition in Sight July 18, 2017
By Mark Terry, BioSpace.com Breaking News Staff

When a company has no competition, there is a tendency to wonder if they’re either visionary or peddling a product nobody wants. In the case of these two biotech companies, it very much looks like they’re visionary—and with little or no competition at the moment, ready to charge ahead into the market. Brian Feroldi, writing for The Motley Fool, takes a look.

1. Novocure

With corporate offices in Jersey Isle, U.K., Novocure (NVCR) has U.S. operations in Portsmouth, N.H., Malvern, Penn., and New York City. It also has European operations in Switzerland and Germany, as well as in Japan and Israel.

There are three modalities for treating cancer—surgery, radiation, and chemotherapy. Novocure is leading with a fourth modality, tumor treating fields (TTFields). Broadly speaking, TTFields are like setting up electric fields around a tumor. During cell division, polar proteins need to be exactly aligned at the correct time to pull chromosomes into daughter cells. When the cells are exposed to electric fields, the proteins that make up the tubule spindles, don’t form properly, the cells don’t divide properly, and basically self-destruct.

The company’s device, Optune, was approved by the U.S. Food and Drug Administration (FDA) in 2011. It has also been approved to treat newly diagnosed GBM, a type of brain tumor, in combination with temozolomide chemotherapy. The use in combination with chemotherapy is a particular bonus, because it appears to make chemotherapy more effective.

The company’s executive chairman, Bill Doyle, told Feroldi, “In the case of GBM, our data suggest those two therapies [Optune and Temozolomide] are additive, so one plus one equals two. With other chemos, we see profound synergy, meaning one plus one equals three-plus. And we now just presented data on trials in ovarian cancer and pancreatic cancer where we’re treating with taxanes, and we see phenomenal results in those cases. In some respects, it’s earlier, but the promise is even more dramatic than what we’ve seen to do in the brain cancer.”

And there are no systemic adverse effects to the treatment. Plus, as Feroldi notes, “since no other company has commercialized a competing TTField product, this is a market that Novocure has all to itself.”

Novocure is currently trading for $18.15.

2. Acadia Pharmaceuticals

Headquartered in San Diego, Acadia focuses on diseases of the central nervous system. The company’s lead product is Nuplazid, which has been approved for Parkinson’s disease psychosis (PDP). It is also being evaluated for Alzheimer’s disease psychosis (ADP), which is a much bigger market. Nuplazid is the only approved treatment for PDP.

Feroldi notes that sales of Nuplazid were strong right from launch, selling more than $17 million in the last half of 2016. Now that physicians are hearing more about it and reimbursement is in place, analysts are projecting $91 million in sales this year with rapid growth going forward.

Feroldi writes, “While Acadia’s market opportunity in PDP is looking bright, the company also believes that Nuplazid could be used in a number of other disease states as well. It’s funding several late-stage clinical trials of Nuplazid for diseases such as schizophrenia, Alzheimer’s disease psychosis, Alzheimer’s disease agitation, and depression. While Acadia will face plenty of competition in many of these disease states, the company could enjoy the same virtual monopoly it has in PDP in Alzheimer’s disease psychosis, since there are currently no FDA-approved treatments for it on the market.”

The company’s market cap is now more than $3.3 billion, but appears to be built less on sales than sales potential.

Acadia is currently trading for $28.85.

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