Biotech Values

[delavida]

ECYT vs CLVS

http://www.fool.com/investing/general/2014/03/24/better-buy-clovis-oncology-inc-or-endocyte-inc.aspx

Last Friday, the company announced that the European Medicines Agency conditionally approved vintafolide (brand name Vynfinit), a folate receptor SMDC, as a treatment for platinum-resistant ovarian cancer, as well as two companion imaging agents. In a separate press release the same day, Endocyte announced that Vynfinit showed promise as a potential treatment for NSCLC in a mid-stage trial when used in combination with the chemotherapy drug docetaxel. Vynfinit is being co-developed with Merck (NYSE: MRK ) under a licensing agreement worth up to $1 billion for the successful develop of the drug across six different cancer types.

Looking at the remainder of Endocyte's pipeline, the company does have a handful of other SMDCs completing preclinical studies for prostate cancer, and Vynfinit is also expected to begin a mid-stage trial for triple negative breast cancer soon, which will be funded and undertaken by Merck.

Turning to Endocyte's fundamentals, the company is in a relatively strong position, ending 2013 with $148 million in cash and cash equivalents. Moreover, the commercialization costs of Vynfinit in Europe should be borne by Merck. So I wouldn't expect a major secondary offering to be forthcoming in the near-term.

Foolish wrap-up
In this comparison, I believe Endocyte comes out the winner. My view is that Endocyte simply offers more value to investors than Clovis at current levels. Namely, Endocyte is on the verge of having a commercial product and only boasts a market cap of $1 billion. By contrast, Clovis is at least two years away from even submitting a regulatory filing for one of its clinical candidates, yet sports a market cap of $2.7 billion. Overall, Endocyte looks like it could outperform the broader market on the back of these recent developments, whereas Clovis could struggle to hold onto its lofty market cap in this difficult market.