Why Galena Biopharma Shares Soared

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 Galena Biopharma (NASDAQ: GALE  ) advanced as much as 20% after the company focused on developing cancer therapies announced the acquisition of Mills Pharmaceuticals and received a price target upgrade from Roth Capital.

So what: According a Galena press release that did not mention any financial terms, the acquisition of Mills Pharmaceuticals gives Galena worldwide rights to GALE-401, a patented, controlled release formulation of anagrelide. Galena expects to pursue an expedited regulatory pathway for FDA approval of GALE-401 as a treatment for essential thrombocythemia, a rare bone marrow disease. Galena estimates the experimental therapy has peak market potential of $200 million. On the heels of this news, Roth Capital boosted its price target on Galena to $11 from $7.

Now what: If Galena can get GALE-401 on an expedited review path this will likely be a smart purchase, although we can never tell for certain without financial terms of the deal being disclosed. Ultimately, Galena shares are roaring higher at just the right time -- cancer immunotherapy treatments are a hot issue among investors at the moment, and the mecca of all health-care events, the JPMorgan Healthcare Conference, is going on this week. I would, however, still recommend exercising caution here with Galena, as many of its major catalysts, specifically as they relate to NeuVax, are still years away.

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  • Report this Comment On January 13, 2014, at 7:14 PM, Zankudo wrote:

    ever hear of abstal…already rolling…it's not a one pony show…

  • Report this Comment On January 13, 2014, at 11:02 PM, bigmac7406 wrote:

    Gale is up approximately 350% since October. Exercise too much caution and you could miss this wonderful opportunity.

    The catalyst that can make you rich is not years away. The primary completion date for Phase 3 NeuVax trials is 15 months away. Source Clinicaltrials.gov.

    Phase 3 NeuVax trials primary completion and FDA decision likely May 2015. Gale's share price could likely skyrocket as did Intercept this week.

    Between now and May 2015 there are many catalyst that will likely continue to push the price up. These include in the short term:

    - Increased Institutional Holding

    - Abstral Sales Potential

    - Valuation

    - Gale will announce full enrollment of Phase 2 clinical Trials of Folate Binding Protein for ovarian cancer.

    - The 70 events on Phase 3 NeuVax will be reached. Interim reports on NeuVax are good.

    - NeuVax Phase 2b (NeuVax + Herceptin) will yield results comparable to Phase 2.

    - Gale will report sales data for Q4 of 2013.

    This is "The One" you have been looking for.

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