Wednesday’s Top Health Care Stories: Isis Pharmaceuticals, Enzymotec, Incyte, and AstraZeneca

Isis Pharmaceuticals, Enzymotec, Incyte, and AstraZeneca could loom large in health care headlines this Wednesday morning.

May 14, 2014 at 9:10AM

Longview

Let's take a look at four stocks -- Isis Pharmaceuticals (NASDAQ:IONS), Enzymotec (NASDAQ:ENZY), Incyte (NASDAQ:INCY), and AstraZeneca (NYSE:AZN) -- that could make waves across the health-care sector this Wednesday morning.

Isis surges on positive midstage results for diabetes drug
Isis Pharmaceuticals was up more than 13% in pre-market trading, following the announcement that its experimental type 2 diabetes drug, ISIS-GCGRRx, successfully reduced blood sugar levels in patients during a midstage study. The trial tested two doses of the drug on 75 patients with type 2 diabetes who experienced uncontrolled blood sugar levels despite receiving standard treatment.

Although this is a positive development for Isis, investors should remember that ISIS-GCGRRx is not one of the company's most advanced drug candidates.

Isis currently has one marketed product with Sanofi (NYSE:SNY) -- Kynamro, a treatment for homozygous familial hypercholesterolemia, or HoFH, a rare genetic disorder that only affects one in 1 million. Kynamro's only rival in HoFH treatment is Aegerion's Juxtapid, one of the priciest drugs in the world with a price tag of nearly $300,000 per patient per year. Kynamro is much cheaper at $176,000 annually.

One of Isis' most promising pipeline drugs is ISIS-TTRRx, an experimental treatment for TTR Amyloidosis, a neurodegenerative disease characterized by pain, numbness, muscular weakness, and autonomic dysfunction. ISIS-TTRRx is being tested in phase 3 trials with GlaxoSmithKline. Isis also holds several midstage pipeline collaborations with Biogen Idec, Roche, and Regulus.

Enzymotec falls despite topping analyst estimates for the first quarter
Enzymotec, a manufacturer of active bio-lipid ingredients and medical foods, was down more than 8% in pre-market trading this morning despite reporting first-quarter earnings that topped analyst estimates on the bottom line -- although there was a slight miss on the top line.

Enzymotec reported that its non-generally accepted accounting principles net income rose 135% year over year to $5.6 million, or $0.24 per share. Revenue, based on its equity method of accounting, rose 29% to $17.9 million. Analysts had expected Enzymotec to earn $0.17 per share on revenue of $19.4 million.

For the full year, Enzymotec forecasts non-GAAP earnings of $0.64 to $0.94 per share, in line with analyst estimates. Full-year 2014 net revenue, based on the equity method of accounting, is expected to rise 5% to 31% year over year to a range between $68 million and $85 million.

Enzymotec mentioned that two major events will impact its second-quarter earnings -- a temporary shutdown of a manufacturing plant to upgrade its capacity, and changes in Chinese regulations regarding infant formula that require the company to update its production chain. Neither change, however, is expected to impact overall full-year revenue.

However, investors should remember that Enzymotec is engaged in a patent litigation dispute with Neptune Technologies & Bioressources over products made from Antarctic krill oil -- which could result in required royalty payments eroding its bottom-line growth.

Shares of Enzymotec, which went public last September, have fallen 13% over the past three months. That decline can be attributed to concerns about Neptune and a secondary offering of 4.4 million shares in early March.

Incyte signs a new collaboration with AstraZeneca
Last but not least, Incyte just announced two new collaborations with AstraZeneca's MedImmune subsidiary to study new cancer treatments. AstraZeneca acquired MedImmune for $15.6 billion back in 2007 to expand its portfolio of biologic drugs.

The companies will test a combination of two drugs, known as immunotherapies, designed to boost the immune system's natural ability to fight cancerous tumors. A combination of the two drugs -- AstraZeneca's MEDI4736 and Incyte's INCB24360 -- will be tested in a phase 1/2 clinical study evaluating their efficacy in treating multiple solid tumors such as skin, lung, head, neck, and pancreatic cancers.

Incyte notably entered into a similar agreement with Merck in February, evaluating INCB24360 alongside Merck's immunotherapy drug MK-3475 in a phase 1/2 study for non-small cell lung cancer.

These partnerships represent promising new ways for Incyte to decrease its dependence on revenue from Jakafi/Jakavi, a treatment for the blood disorder myelofibrosis. Incyte markets the drug as Jakafi in the United States, while its partner Novartis markets it as Jakavi abroad. Last quarter, Incyte reported that U.S. sales of Jakafi rose 44% year over year to $69.7 million, accounting for 78% of its top line. The remainder of Incyte's revenues are mainly generated by royalty payments and collaborative revenues. Shares of Incyte are up more than 130% over the past 12 months.

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

 

Leo Sun has no position in any stocks mentioned. The Motley Fool recommends Isis Pharmaceuticals. 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.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers