Let's talk about three biotechs making waves recently and what has led them to where they are today. Both Gilead Sciences (GILD 3.27%) and Celgene Corporation (CELG) were up last week, leading to hopes the biotech sector may finally be returning to price growth this year.

Gilead is up 7% the last five days, putting it within striking distance of its 52 week high. Celgene's stock showed significant signs of life, up 5%, while remaining 15% off its high. The bad news was Amgen Inc (AMGN 0.71%). Its lousy first quarter earnings left it stuck in the negatives.

Gilead Sciences and Sovaldi
Gilead Sciences is the poster child for what has gone wrong and what could go right for biotech this year. On March 21, three members of Congress sent a letter to Gilead challenging its $80,000 price tag on its new Hepatitis C drug Sovaldi. The whole sector's cage got rattled when the word got out.

The problem with Sovaldi isn't just price, however, but the volume and type of patients. Drugs for "orphan diseases" are routinely priced just as high, if not higher. Biotechs justify the cost based on the small number of patients and the expense of research and development.

Hepatitis C is different. Over three million Americans have Hepatitis C. It can be spread in multiple ways, but the most common means is through intravenous drug use, according to the Centers for Disease Control and Prevention. Sovaldi is truly a miracle drug, but the cost of treatment could be a monumental problem for Medicaid and, eventually, American taxpayers.

UnitedHeath Group and WellPoint both mentioned the cost of Sovaldi in recent conference calls. Sovaldi's price tag in the United States could be a point of weakness for Gilead. It may not be sustainable, if insurers are able to change coverage to more affordable alternatives.

Celgene could be the comeback kid
Celgene had a rock-solid quarter with strong top and bottom-line growth. The company recently won U.S. approval for a pill to treat psoriatic arthritis (Otezla). Best of all, it's trading at a multiple that has not been seen since the Affordable Care Act was announced four years ago. 

So what's keeping this good stock down? There's been some buzz about Mylan's suit against Celgene to stop the latter's effort to keep generic versions of Celgene's blockbuster drug Revlimid off the market.

Is Amgen a break-up candidate?
Amgen is one of those companies where the stock value doesn't seem to reflect the sum of its parts.

Unfortunately, the different parts of Amgen don't mesh well, and the company often gets underestimated. Amgen also doesn't get near as much push from great news about its pipeline drugs as other biotechs. The stock performance is trailing not only other biotech companies, but pharma as well.

Bernstein analyst Geoffrey Porges believes Amgen could be a breakup candidate. The idea was picked up by Forbes' Matthew Herper and given a different spin. Both analysts believe the flurry of big pharma spin-offs shows how Amgen's two identifiable businesses could be split, releasing value for stockholders.

All right, then.

Overall, it was a pretty decent week. But in high-flying biotech land, we can't call last week's modest improvement a party. But hopefully these stocks will give us more insight into the sector as a whole and the potential for a price recovery there.