With the Nasdaq Biotechnology Index up 65% since the start of the year, it's clear that the biotech sector performed extraordinarily well in 2013-but which stocks were the biggest winners? Several small-cap and mid-cap biotech companies posted returns of 200% or more through the middle of December this year, and, in this series, I review the 15 biggest movers.

Let's continue this 2013 review with number 14 on the list, Clovis Oncology (NASDAQ:CLVS). Investors weren't sure whether Clovis, which rallied 229% this year through the middle of December, would emerge from 2013 as an independent company.  Rumors swirled Clovis was seeking a buyer in September. But instead of getting acquired, it struck a $420 million deal to buy Ethical Oncology in November.

Expanding cancer drug pipeline

That deal gave Clovis Ethical's mid stage drug lucitanib and potential milestone payments tied to Ethical's pre-existing collaboration with French drug maker Servier.

Servier inked a deal with Ethical in 2012 to gain rights to lucitanib outside the U.S., Japan, and China. Clovis could stand to receive up to $470 million in milestones from Servier if lucitanib succeeds in trials. Clovis also benefits from a cost-sharing arrangement with Servier in which Servier will pay up to $108 million in development costs and then split any additional costs with Clovis.

Lucitanib showed a 50% response rate in breast cancer patients with FGF aberrant genes during a phase 1/2a trial. So Clovis expects to ramp development with an early focus on the 25% of breast cancer patients that have the FGF mutation.  If the drug eventually wins approval, it will join a host of oncology medications targeting specific genes related to breast cancer, including Roche's (NASDAQOTH:RHHBY) Kadcyla.  Roche won approval for Kadcyla in February for HER2 positive breast cancer  and analysts estimate Kadcyla could see peak sales of up to $2.5 billion a year.

The addition of lucitanib strengthens Clovis cancer pipeline, which includes rucaparib -- a PARP inhibitor drug in phase 2 trials for the treatment of ovarian cancer.  Following data showing 89% of ovarian cancer patients responded to rucaparib in a phase 1 trial, Clovis announced it will move the compound into late stage trials before year end.   That puts rucaparib slightly behind AstraZeneca's (NYSE:AZN) olaparib.  In September, AstraZeneca filed for approval of olaparib in Europe as a treatment for ovarian breast cancer patients with the BRCA gene mutation.

Clovis' pipeline also includes the early stage drug, CO-1686, which targets lung cancer.   In October, Clovis announced an agreement for Qiagen (NASDAQ:QGEN)  to develop a companion diagnostic test that can be used to identify those patients most likely to benefit from CO-1686. That agreement comes following Qiagen's previous success in developing tests identifying EGFR mutations using its Therascreen platform, including a companion diagnostic test used alongside colorectal drug Erbitux.

Fool-worthy final thoughts

Clovis plans to advance lucitanib as a treatment for non small cell lung cancer too, and thinks the drug may also prove valuable against kidney cancer and thyroid cancer.   That suggests Clovis may have a diverse pipeline of opportunities targeting breast, ovarian,  lung, kidney, and thyroid cancer.  According to the National Cancer Institute, over $37 billion was spent treating those conditions in the U.S. during 2010, suggesting investors ought to keep a close eye on Clovis trial results over the coming couple years.  

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Todd Campbell has no position in any stocks mentioned. Todd owns E.B. Capital Markets, LLC.  E.B. Capital's clients may or may not have positions in the companies mentioned.  Todd also owns Gundalow Advisors, LLC.  Gundalow's clients do not have positions in the companies mentioned. The Motley Fool recommends Qiagen. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.