Why Celldex Therapeutics Inc. Shares Skyrocketed

Celldex shares soar after it buddies up with this Big Pharma to explore various cancer treatment options in phase 1/2 studies.

May 14, 2014 at 2:30PM

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 Celldex Therapeutics (NASDAQ:CLDX), a clinical-stage biopharmaceutical company focused on developing novel immunotherapeutic solutions to fight cancer, rocketed higher by as much as 28% today following the announcement of a clinical trial collaboration with Bristol-Myers Squibb (NYSE:BMY).

So what: According to Celldex's early morning press release, the two companies will combine Bristol-Myers' investigational anti-PD-1 inhibitor nivolumab and Celldex's investigational compound varlilumab, a CD-27-targeting antibody, in a phase 1/2 study that could include multiple solid tumor types, including non-small cell lung cancer, metastatic melanoma, and ovarian, colorectal, and squamous cell head and neck cancers. The belief based on preclinical studies is that the combination of immunotherapies could enhance the body's immune system to recognize and fight back against these cancer types. Under the terms of the agreement, Bristol-Myers will make a one-time up-front payment of $5 million to Celldex. with the two companies sharing development costs. The phase 1/2 study is expected to begin by the fourth quarter.

Now what: This is great news if you're a shareholder in Celldex because it means the company has potentially landed a brand-name marketing partner in Bristol-Myers Squibb (if the combo proves successful). In addition, it gets to combine one of its most promising compounds with arguably one of the most prominent immuno-oncology clinical options available. I will be very eager to see the early results from the combination of these two therapies.

However, I would also suggest that investors not let this news go to their heads. Celldex is already valued at a whopping $1.4 billion and is entirely a clinical-stage company. While there's plenty of promise here with rindopepimut as a front-line glioblastoma multiforme therapy, the most aggressive form of brain cancer, I would caution that all of that optimism and then some has likely been baked into its shares already.

Celldex may have soared today, but it's unlikely to be able to keep pace with this top stock over the long run
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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't 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.

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