Medivation (NASDAQ: MDVN) is best known for developing therapies to treat serious diseases. Earlier in 2014 the biopharmaceutical company received FDA approval to expand the use of Xtandi, a prescription medicine used to treat men with prostate cancer.
Since the expansion of the drug was approved Medivation’s stock has increased about 60%. In addition, the company raked in $200 million in revenue during their most recent quarter.
On January 22, Medivation and partner Astellas Pharmaceuticals reported data collected from a TERRAIN study, which evaluated Xtandi (enzalutamide) in comparison to Casodex (bicalutamide), a direct competitor of the treatment in metastatic prostate cancer. The study achieved its goal showing a statistically considerable increase in the lives of patients with metastatic prostate cancer when using Xtandi over Casdodex. In addition, the study also revealed a delay in tumor growth in patients using Xtandi.
Neal Shore, MD, co-principal investigator of the TERRAIN study and Medical Director, Carolina Urologic Research Center, said of the data, "The results of this study showed that enzalutamide provides a longer duration of disease control in the studied patient population compared to bicalutamide. … This robust data set adds to an impressive and consistent body of data for enzalutamide across multiple studies and stages of prostate cancer."
Medivation is scheduled to announce its fourth quarter 2014 earnings report on February 25th.
Analyst David Nierengarten of Wedsbush weighed in on Medivation on February 2, reiterating an Outperform rating on the stock with a $118 price target. Nierengarten reasoned his bullish rating to sales of Xtandi coming in ahead of his estimates, which were $218.3 million. “Astellas reported U.S. Xtandi sales of $230.2 [million].” The analyst believes, “[full-year 2014] U.S. sales will now reach approximately $680M, ahead of our previous estimate of $667M and consensus of $645M.” He concluded, “After the EU label expansion of Xtandi to use in pre-chemotherapy patients back in December, we expect stronger growth to be reflected in Q1:15; as previously noted, Zytiga sells more ex-U.S. than U.S., indicating significant market.”
David Nierengarten has rated Medivation five times since September 2012, earning a 100% success rate recommending the stock and a +20.6% average return per recommendation.
Nierengarten often rates stocks in the biopharmaceutical industry, such as bluebird bio (NASDAQ: BLUE) and NPS Pharmaceutcals (NASDAQ: NPSP), helping him earn an overall success rate of 68% recommending stocks and a +33.4% average return per recommendation.
The analyst has rated bluebird bio 6 times since July of 2013, earning an 83% success rate recommending the company and an impressive +103.7% average return per recommendation. Likewise, Nierengarten has rated NPS Pharmaceuticals nine times since March of 2013, earning an 86% success rate recommending the company and a +65.9% average return per recommendation.
However, Neirengarten is not always as accurate with his recommendations. The analyst has rated Stemline (NASDAQ: STML) twice since September 2013 with only a 50% success rate and a -30.8% average loss per recommendation.
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