Like four-leaf clovers or Po'ouli birds in the wild, profitable drug companies with one major drug exist -- but they're not very common.

So it's kind of impressive that Onyx Pharmaceuticals (Nasdaq: ONXX) has made a profit two years in a row: $0.03 per share in 2008, and a much healthier $0.27 per share last year. The latter feat is even more impressive because it includes charges from Onyx's pipeline-stocking purchase of Proteolix.

At least superficially, though, shareholders don't seem too impressed by the profitability. Just look how Onyx compares to its in-the-red peers:

Company

Major Drug

Partner

Market Cap (in millions)

2009 Revenue (in millions)

Price/Sales

Onyx

Nexavar

Bayer

$1,829

$843*

2.2

Elan (NYSE: ELN)

Tysabri

Biogen Idec (Nasdaq: BIIB)

$3,883

$1,113

3.5

Amylin Pharmaceuticals (Nasdaq: AMLN)

Byetta

Eli Lilly (NYSE: LLY)

$2,431

$758

3.2

*Nexavar sales as recorded by Bayer; Onyx's P/S is based on this number.
Source: Capital IQ, a division of Standard & Poor's.

There are a couple of reasons why Onyx is valued lower than Elan and Amylin on a revenue basis. First, the latter two both derive revenue from unpartnered drug(s) in addition to their major partnered drug; Onyx only has Nexavar. Second, Onyx has a 50/50 partnership with Bayer, except in Japan, where it receives a considerably lower royalty. Sales in Japan made up more than 10% of Nexavar sales last year, and continued to accelerate through the fourth quarter.

Perhaps the biggest reason for Onyx's low valuation is that biotech companies are valued based on their current drugs, plus their potential for future growth. While Onyx is testing Nexavar in other cancer types, the rest of its pipeline is farther back in development . In contrast, Amylin has a new drug up for review at the Food and Drug Administration, and Elan's phase 3 Alzheimer's drug, partnered with Johnson & Johnson (NYSE: JNJ) and Pfizer (NYSE: PFE), is scheduled to read out this year.

It may seem unattractive for unprofitable drug companies such as Elan and Amylin to plow their earnings back into research and development, but the short-term pain may be worth the long-term gain.

Todd Wenning has some suggestions on how to find the greatest stocks of the next generation.

Elan is a Motley Fool Rule Breakers pick. The newsletter is always on the hunt for hot drug stocks and other cutting-edge picks. Click here to see all of our latest discoveries with a free 30-day trial subscription.

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Pfizer is an Inside Value recommendation. Johnson & Johnson is an Income Investor pick and the Motley Fool Options has recommended buying calls on the stock. The Fool has a disclosure policy.