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bluebird bio Inc.: Waiting for ASH

By Brian Orelli, PhD - Feb 29, 2016 at 3:40PM

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The biotech releases earnings, but the focus is on the American Society of Hematology meeting in November.

bluebird bio ( BLUE 0.60% ) reported earnings on Wednesday. As the biotech often does, the earnings came with no notice and didn't have a conference call because management understands that those things are much more important to companies that actually have products on the market.

bluebird bio results: The only number you really need to know

 

Q4 2015 Actuals

Q4 2014 Actuals

Growth (YOY)

Cash, Cash Equivalents, and Marketable Securities

$866 million

$492 million

76%

What happened with bluebird bio this quarter?

  • For the record, bluebird bio lost $47 million in the fourth quarter, compared to less than $20 million in the year-ago quarter. Not that surprising considering it's running more trials now.
  • More importantly, the biotech ended the year with considerably more cash than it had at the end of 2014 thanks to a secondary offering in June.
  • On the pipeline front, bluebird bio presented less-than-stellar data at American Society of Hematology meeting on its gene therapy LentiGlobin in beta-thalassemia and sickle cell disease.
  • While all eyes are bluebird bio's gene therapy program, the CAR-T program, testing bb2121 in patients with multiple myeloma has begun. The company's partner on the project, Celgene ( CELG ), has exercised its option to license the drug, which triggered a $10 million payment from Celgene. The endorsement in bb2121 is significant because Celgene has already expressed its admiration for bluebird bio's CAR-T competitor, Juno Therapeutics, in the form of an equity investment.

What management had to say

IMAGE SOURCE: NATIONAL INSTITUTES OF HEALTH.

ASH put a damper on bluebird bio's chances for quickly developing a treatment for sickle cell patients, which Nick Leschly -- who has the silly title of chief bluebird -- didn't shy away from while also highlighting the potential to get a drug on the market for beta-thalassemia patients, "In 2015, bluebird bio defined an accelerated regulatory path for LentiGlobin in beta-thalassemia and established a powerful reason to believe in LentiGlobin in sickle cell disease, though there is still more to learn as we treat additional patients."

"We are particularly looking forward to sharing data from the Starbeam study for the first time," Leschly said of the study of Lenti-D in cerebral adrenoleukodystrophy that should occur in April.

Looking forward
Investors are going to have to wait until ASH next year to get an update on the patient taking LentiGlobin. November is nine months away, but that feels like 37 years in short-term investor time. We may also get some information this year on improvements to its gene therapy platform that could increase the efficacy.

Don't be surprised to see substantial volatility in the stock between now and then as momentum temporarily takes over for fundamentals due to the lack of a news flow.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

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$10.01 (0.60%) $0.06
Celgene Corporation Stock Quote
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