Today's Top Health Care Stocks to Watch: Bristol-Myers Squibb and Kamada Ltd.

Top stories in health care and biotech.

May 16, 2014 at 9:00AM

Longview

Let's take a look at today's top stories in biotech and health care. Keep an eye out for Bristol-Myers Squibb (NYSE:BMY), Kamada Ltd.(NYSE:BMY)

Can Bristol-Myers rebound today?
Shares of Bristol-Myers Squibb fell over 6% yesterday following a downgrade by BMO Capital Markets after the company reported weak clinical trial data for its closely watched non-small cell lung cancer drug nivolumab. Nivolumab is part of a new class of drugs being studied by a host of pharma heavyweights known as PD-1 inhibitors, or programmed death inhibitors. Broadly, PD-1 inhibitors are believed to help the immune system recognize tumor cells and thus boost a person's immune reaction.  

Yesterday, we learned, per data released for the upcoming American Society for Clinical Oncology meeting, that nivolumab in combination with Yervoy only reduced tumor burden for 22% of patients receiving the treatment. However, nearly half of patients receiving the combo therapy experienced an adverse event, with many discontinuing the trial altogether. In short, these aren't great data for lung cancer, and the high adverse event rate is worrisome. 

Looking ahead, Bristol-Myers still plans on filing for regulatory approval for the combo as a third-line lung cancer therapy, but these data don't bode particularly well for its prospects. As a reminder, nivolumab is also being studied as a treatment for melanoma and renal cancer, giving the drug other shots at a potential regulatory approval down the road.

What's my take? I thought Bristol-Myers was fairly priced prior to this sell-off. After this data release and subsequent drop, I am thus considering entering the stock at these levels. My reasoning is simple. Bristol-Myers offers a dividend of nearly 3%, it has a strong clinical pipeline, and top-notch management. Clinical failures are part and parcel of the health care sector, and price swings can create attractive entry points.

Kamada Ltd. falling on mixed trial data
Shares of Israel-based Kamada are down over 27% on heavy volume in premarket this morning after the company released preliminary top-line results for its pivotal clinical trial for its inhaled Alpha-1 Antitrypsin therapy for the treatment of Alpha-1 Antitrypsin Deficiency, or AAT. What you need to understand is that the drug did not achieve its primary endpoint of time to the first moderate or severe exacerbation event at one year. The company did note that the secondary endpoint "frequency of severe exacerbation" was approximately 50% lower in the AAT group compared to placebo. 

Despite stressing the importance of the secondary endpoint in its press release, I think you would be wise to sidestep Kamada for the time being. The drug's failure to perform better than placebo for the primary endpoint will likely be a sticking point for regulators, meaning the drug's chances of approval are likely diminished.

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.

George Budwell has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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