Celgene Corporation (CELG) Soars in 2013; What Does the Future Hold?

In addition to strong earnings, the company also provided future guidance. Total net product sales are expected to increase by approximately 11% year over year to $6 billion. REVLIMID net product sales are expected to increase by approximately 10% year over year to $4.2 billion. Adjusted EPS guidance was raised to a range of $5.55 to $5.65 from a range of $5.50 to $5.60.

Earlier I mentioned the potential for Celgene because of its drug Abraxane. During a June 3 presentation at the American Society of Clinical Oncology annual meeting, Celgene Corporation (NASDAQ:CELG) presented additional data on the current MPACT Trial of Abraxane. Overall trial results showed that patients treated with Abraxane plus gemcitabine had a statistically significant improvement in overall survival compared to those who were treated with gemcitabine alone (median of 8.5 vs. 6.7 months). Given that pancreatic cancer is the eighth-leading cause of cancer-related death worldwide and the fourth-leading cause of cancer-related death in the U.S., the market potential is huge.

The competition

Clearly Abraxane has potential. But what about competitors? The large competitor is currently Threshold Pharmaceuticals, Inc. (NASDAQ:THLD). Threshold is currently involved in a Phase III trial called MAESTRO. This is a randomized, double-blind, placebo-controlled trial of TH-302 in combination with Gemcitabine in patients with metastatic or locally advanced unresectable pancreatic cancer. Threshold’s technology is built around hypoxia activation. Hypoxia (oxygen deprivation) is a characteristic of most solid tumors. Because of the presence of tumors, the blood flow is typically inadequate which can cause hypoxic areas to grow. The cells found in these areas are typically extremely resistant to traditional cancer therapy. So Threshold is attempting to fill this area of need. Thus far, the studies have proved promising.

Consider Celgene

Despite the competition risk from Threshold, I still believe Celgene Corporation (NASDAQ:CELG) will end up prevailing – or potentially even acquiring Threshold. Threshold currently has a market capitalization of $323 million, which would be a drop in the bucket for Celgene (market cap of $51.5 billion).  Therefore, I would encourage investors to strongly consider adding Celgene Corporation (NASDAQ:CELG) to their portfolio if they haven’t already done so because of its strong fundamentals, deep pipeline of drugs, and strong technicals.

Ted Mayer has no position in any stocks mentioned. The Motley Fool recommends Celgene.

The article Celgene Soars in 2013; What Does the Future Hold? originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.