Pharmacyclics (UNKNOWN:PCYC.DL) has made a big move in the past two years as investors have become increasingly excited by the potential for Imbruvica, a drug being co-developed with Johnson & Johnson (NYSE:JNJ) that won its first FDA approval last November.

Imbruvica has the potential to serve as a major catalyst for Pharmacyclics' future, making the company a major player in cancer and autoimmune drug development similar to Celgene (NASDAQ:CELG).

Source: Pharmacyclics.

Following footsteps
Pharmacyclics could do worse than modeling itself after Celgene, which got its start with the approval of Revlimid for myelodysplastic syndromes in 2005.

Revlimid notched label expansions for use in multiple myeloma in 2006 and mantle cell lymphoma in 2013. It become a megablockbuster drug that racked up more than $1.1 billion in sales during the first quarter, up 14% from a year ago.

Celgene has leveraged Revlimid's success to build a successful franchise of other compounds, including Abraxane, Pomalyst, and Otezla.

In 2010, Celgene spent $2.9 billion buying Abraxis to get its hands on Abraxane, a drug used to treat metastatic breast cancer, non-small cell lung cancer, and pancreatic cancer. Sales of Abraxane totaled $185 million in the first quarter, up 50% from last year.

Pomalyst won FDA approval in 2013 for advanced multiple myeloma; its sales have climbed 375% in the past year, to $135 million in the first quarter. And Celgene in March received FDA approval for Otezla, as a treatment for psoriatic arthritis; it may win approval for the drug's use in psoriasis patients later this year.

Celgene has also used Revlimid's cash to fuel a flurry of collaboration deals on next-generation cancer and autoimmune disease therapies, including partnerships with bluebird bio, Agios, Epizyme, and Acetylon.

Source: Pharmacyclics

Imbruvica's opportunity may prove similar
Analysts forecast that Imbruvica could generate more than $3 billion in sales annually by 2018.

The drug got its first FDA approval in November 2013 for use in mantle cell lymphoma and won a second approval in February for chronic lymphocytic leukemia.

In the first quarter, those indications delivered $56 million in net product sales that were split equally between Pharmacyclics and Johnson & Johnson. Based on Imbruvica's first-quarter results, Pharmacylics is guiding investors to expect net sales of $80 million during the second quarter and $300 million for the full year.

That's a solid start for Imbruvica, but sales could head significantly higher if ongoing trials for multiple myeloma, diffuse large B-cell lymphoma, and follicular lymphoma result in additional approvals.

It those approvals pan out,  Imbruvica will provide Pharmacyclics with valuable cash that can be used to advance other programs through clinic, including PCI-27483 for the treatment of pancreatic cancer and a highly selective BTK inhibitor that targets arthritis.

Source: Pharmacyclics

Fool-worthy final thoughts
Thanks to its partnership deal with Johnson & Johnson, Pharmacyclics has deep pockets and market share-winning marketing might.

Pharmacyclics shares aren't overly cheap based on expected revenue this year, but for long-term investors there may be a solid opportunity -- note that Celgene's market cap is nearly $70 billion, or roughly nine times annual sales. If Imbruvica delivers on analysts' $3 billion projection for annual sales, a similar valuation for Pharmacyclics suggests that its current $7 billion market cap could have room to go higher.