Biotech Grudge Match: Game, Set, & Match?

Affymax (NASDAQOTH: AFFY  ) is starting 2013 in the best way possible and recently announced a deal with dialysis provider DSI Renal. Its drug, Omontys, is being used in dialysis centers, including some managed by Fresenius Medical Care (NYSE: FMS  ) , and Affymax shareholders hope that the company can secure more lucrative deals in the coming months.

Despite Omontys' dosing advantage, however, biotech stalwart Amgen's (NASDAQ: AMGN  ) drug Epogen is still a formidable competitor in this space. The head-to-head competition for these anemia drugs is far from over, and, in the following video, health care analyst Max Macaluso weighs in on the debate.

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  • Report this Comment On January 08, 2013, at 6:40 PM, mbracket123 wrote:

    Hi Max,

    Not sure I understand your last comment where you say "growth (in stock price I presume) should be constrained as sales ramp." That doesn't really make any sense as you don't comment on what the growth in sales will be over the next two years or any other key metric as it relates to stock price.

    It seems to me that we will see a large increase in price if sales hit analyst consensus number in 2013 of $161.34M, up from $97.58M, all the while closing in on profitability. Personalty I tihnk the whole industry will switch to Omontys - as you said they will be driven primarily by cost and efficiency.

    If you do simple comparison to other fast growing bio companies you will see a comp of 7x - 10x next year sales, or $1.2B to $1.6B mkt cap. And I think they will actually grow much faster.

    Would appreciate your quantitative analysis to support your conclusions - otherwise these seem like just fluff opinion pieces. Thanks, Mike

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