Gone are the days when Celgene (NASDAQ:CELG) produced annual revenue growth of 40% to 60%. With maturing drugs, it would be impossible for the blood-cancer powerhouse to keep that kind of growth up forever.

Don't worry, though. Celgene isn't turning into a Pfizer (NYSE:PFE) or Merck (NYSE:MRK) quite yet. Preliminary 2009 sales released at the J.P. Morgan Health Care Conference today have sales up about 20% year over year and Celgene is guiding for 20% revenue growth next year as well.

Most investors would happily take 20% growth year after year from their investments. Of course investors are paying for that growth with a higher valuation than most of its mid-cap peers.

Company

Market Capitalization
(in Billions)

Price/Adjusted Earnings

Celgene

$26.3

27.5*

Biogen Idec (NASDAQ:BIIB)

$15.6

14.1

Amgen (NASDAQ:AMGN)

$57.5

11.5

Genzyme (NASDAQ:GENZ)

$14.3

18.0

Gilead Sciences (NASDAQ:GILD)

$40.1

18.5

Source: Yahoo! Finance. *Based on announced preliminary 2009 results of $2.08 per share.

To continue to justify that premium, Celgene needs to get Revlimid approved as a first choice for patients with multiple myeloma. So far the data looks promising for using the drug in a maintenance capacity, but it's unclear how much patients are benefiting from the early use of Revlimid.

Celgene also needs to continue growing earnings faster than revenue. Last year, the company was able to turn a 20% revenue increase into a 30%-plus increase in adjusted earnings, and next year it's looking for about a 25% increase in adjusted earnings on a 20% increase in revenue. Because a company is valued on earnings and cash flow, keeping one's costs rising slower than its revenue should help support its share price. Investors now just have to see if Celgene can do that.

In addition to covering the news from the first biotech conference of the new year, I'll be using the conference to discover a little more about some of the unsung companies at the conference. If you have a suggestion for a company I should research, leave it in the comments box below and then join me back here tomorrow for the first day of the coverage.