This company falls into the J.P. Morgan binary event bucket. PTC Therapeutics Inc. (NASDAQ: PTCT) is a global biopharmaceutical company focused on the discovery, development and commercialization of orally administered, proprietary small molecule drugs targeting an area of RNA biology referred to as post-transcriptional control. Post-transcriptional control processes are the regulatory events that occur in cells during and after a messenger RNA is copied from DNA through the transcription process. PTC’s internally discovered pipeline addresses multiple therapeutic areas, including rare disorders, oncology and infectious diseases.
The JPMorgan team recently upgraded the stock as they feel that, based on physician feedback and increased confidence in the Phase 3 ACT DMD study for Translarna in Duchenne muscular dystrophy, which they believe may be released in October, the stock holds a positive risk-reward profile into the clinical data release.
The JPMorgan price target of $100 is a bit less than the $101.11 consensus target. Considering the shares closed most recently at $39.01, this could be a moon-shot if the team is correct.
This stock makes the list in the pullback bucket, as it has come down almost 30% from the highs printed in late April. Merrimack Pharmaceuticals Inc. (NASDAQ: MACK) is a biopharmaceutical company discovering, developing and preparing to commercialize innovative medicines paired with companion diagnostics for the treatment of cancer. Merrimack seeks to gain a deeper understanding of underlying cancer biology through its systems biology-based approach and develop new insights, therapeutics and diagnostics to improve outcomes for cancer patients. Merrimack has multiple oncology therapeutics in clinical development and additional candidates in late stage preclinical development.
Merrimack has a New Drug Application under review for its top drug MM-398, which was shown to treat pancreatic cancer in Phase 3 trials. Fully one-quarter of patients using the drug have survived, which is a high percentage when you consider that late-stage pancreatic cancer is almost always quickly lethal. JPMorgan likes the chances for approval and anticipates a strong product launch.
The JPMorgan price target is posted at $15, and the consensus target is $15.17. Shares closed Wednesday at $10.50.
While these stocks are only appropriate for very aggressive and risk-tolerant accounts, the JPMorgan team has done an outstanding job of looking for high-probability success, and in biotech investing, that is the most crucial component for investors.
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