Celgene Rises As UBS Upgrades Shares to 'Buy'

NEW YORK (AP) — Shares of Celgene traded higher Thursday after a UBS analyst upgraded the biotechnology company, forecasting strong net income growth.

THE SPARK: Analyst Matthew Roden raised his rating to "Buy" from "Neutral" and increased his price target to $200 per share from $163. Roden said the upgrade reflects his increased confidence in the company's earnings growth over the next four years. He said Celgene's earnings and margins compare favorably to other health care companies.

He said Celgene will report more data about its biggest selling product, the multiple myeloma drug Revlimid, at a medical conference this week. Roden said he thinks that will assuage investor concerns about another recent study.

THE BIG PICTURE: Celgene Corp. gets about two-thirds of its sales from Revlimid, which is approved as a treatment for multiple myeloma, mantle cell lymphoma, and anemia.

In July, Celgene stopped a late-stage study of Revlimid as a treatment for leukemia because patients who took the drug were more likely to die than patients who were given an older treatment. The Summit, N.J., company was running a trial of Revlimid as a treatment for B-cell chronic leukemia as part of an effort to broaden the approval of Revlimid and boost sales.

Revlimid is approved as a treatment for multiple myeloma in patients who have received at least one previous round of treatment. The drug is also approved as treatment for severe anemia and in June the FDA cleared its use against mantle cell lymphoma. Celgene expects to report $4.2 billion to $4.3 billion in sales this year.

SHARE ACTION: Shares of Celgene rose $4.78, or 3 percent, to $164.85 in afternoon trading. The stock has doubled in value in 2013 and reached an all-time high of $166 Thursday.

Posted: December 2013


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