BioMarin Pharmaceutical Inc. (BMRN)

[chmcnfunds]

Biotechs With FDA Review Dates In November 2013
Oct 25 2013, 13:23 | includes: BMRN, xxxx, xxxx

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...)

The following companies have binary events in November that could move their stocks significantly. They all have upcoming FDA review dates for their new drugs. An FDA approval could cause a sizable rise in the stocks, while a rejection or Complete Response Letter could cause a sell-off. Occasionally, the decision date is postponed or moved up to a later date. November presents an interesting mix of a small-cap, a mid-cap, and a large-cap company.

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Biomarin Pharmaceuticals (BMRN) is the mid-cap company among these three firms. It has an FDA review date on 11/19/13 for Vimizim with an indication for Mucopolysaccharidosis Type IVA (Morquio A syndrome). People with Morquio A do not produce enough of the enzyme that is needed to breakdown long chains of sugar carbohydrates into simpler molecules. This results in cellular damage which affects appearance, physical abilities, organ and system functioning, and mental development. Vimizim works by acting as an enzyme replacement which should halt the progression of the disease and alleviate some symptoms. Morquio A is estimated to occur in 1 of every 200,000 births. Currently, there are no specific treatments for Morquio A syndrome. This bodes well for Biomarin as the company has the potential to be the go-to firm for treating this disorder.

Biomarin can be considered of medium to high risk among these three companies. It has four drugs already on the market for other rare diseases and another five in its pipeline being developed in addition to Vimizim. Despite having four drugs on the market, Biomarin is not yet profitable due to high R&D and other costs. The company just reported revenue growth of 6.9% and a loss of $0.38 per share for Q3 2013. Earnings missed the consensus estimates by $0.08 per share.

Biomarin is expected to grow earnings annually by 25% for the next five years. The 22 analysts covering the company have a price target of $79 for the stock which is currently trading at $69. (EDIT: ~$66)

Conclusion

The good thing about biotechs is that they are developing products to improve and extend the lives of individuals. Conservative investors may want to consider Sanofi as it pays a dividend, is established and profitable, and has a sizable portfolio of products on the market. Investors who are willing to take on more risk with more reward potential, may want to consider Biomarin or Vanda, which may see a spike in stock price if the drugs being reviewed become approved by the FDA. However, be prepared for a sell-off in the event that the drugs are not approved or if the decision dates are delayed.
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http://seekingalpha.com/article/1774492-biotechs-with-fda-review-dates-in-november-2013?source=feed_f

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