Don't let it get away!
Keep track of the stocks that matter to you.
Help yourself with the Fool's FREE and easy new watchlist service today.
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of biotechnology company Incyte (NASDAQ: INCY ) lost as much as 13% following the disclosure in a regulatory filing that a patient had developed a case of progressive multifocal leukoencephalopathy, or PML, while taking its lead drug, Jakafi.
So what: Jakafi, which is designed to treat patients with myelofibrosis, is marketed outside of the U.S. as Jakavi by licensing partner Novartis (NYSE: NVS ) . According to the filing, Incyte has alerted the Food and Drug Administration to this case and is in the process of informing investigators currently in clinical trials. However, the company was also clear to point out that people with myelofibrosis could be at higher risk of developing PML to begin with, and it hasn't been determined whether Jakavi was a direct cause of this particular patient developing PML.
Now what: While I'd hardly call this finding good news, I think investors have probably overreacted to an as of now unproven case of PML as compared to the nearly 10,000 prescriptions written around the globe for Jakafi/Jakavi without any serious adverse events. Myelofibrosis patients have few treatment alternatives and Jakafi was proven to be effective in trials, so I highly doubt major corrective action is in order. Investors could be getting quite the bargain picking up Incyte shares on dips related to this news.
Craving more input? Start by adding Incyte to your free and personalized watchlist so you can keep up on the latest news with the company.
While you can certainly make huge gains in biotechs like Incyte, the best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.