LAS VEGAS, NV / ACCESSWIRE / June 16, 2016 / This week Marketwatch released a report titled "Four Reasons for Investors Buy Biotechnology Stocks Now" highlighting why this is an opportune time to enter the biotech market. We couldn't agree more.[1]

The four reasons the writer, Michael Brush, cited for his bullish sentiment on biotechs were:

  • There Will Be More Takeovers - "The reality is, large pharma doesn't do a lot of innovation. They do partnerships," Pfizer recently acquired Anacor for around $100 a share, at a 55% premium. Anacor is a so-called five-bagger since March 2014. These kind of rich profits and takeover premiums are good news for biotech investors, because they put fear in the hearts of anyone short-selling the group, or betting on a decline. That tones down some of the negativity. Potential buyers? Any of the big U.S., European or Japanese pharma companies that have let their research efforts lapse over the past few decades.
  • Valuations Appear Cheap - With or without takeovers, biotech stocks are still attractive because they are so cheap. While stocks overall have recovered most of their losses suffered during the start of the year, the iShares Nasdaq Biotechnology ETF is still near 52-week lows.
  • Research Breakthroughs and Drug Approvals - One thing lost in all the negativity in biotech over the past 6 months or so has been the amount of innovation occurring in the industry. Breakthroughs in areas like cancer immunotherapy, gene therapy and CRISPR gene editing, are some of the major areas innovation has been seen.
  • Hillary is Going to Lighten Up - Once Hillary Clinton closes the deal on the Democratic nomination, she'll move to the right in her campaign against Donald Trump, since she'll no longer be pulled to the left by Bernie Sanders. This will be bullish for biotech because it will mean drug pricing will be less of a presidential campaign issue.

So how do you benefit? You could just buy IBB shares, but if you want to maximize the potential profit there are a few companies that look like they could be the big winners in the biotech resurgence. One that looks particularly enticing is Propanc Health Group Corp. (PPCH).

After a long slide that almost pushed the stock of Propanc below the 1 cent per share mark back in the end of February we saw the ticker gain a fair amount of value over a short period of time and the daily volume spiked during this period as well bringing the stock to almost 5 cents per share in the middle of March. The shares have retraced since reaching this mid-March peak. Still, PPCH managed to keep more than half of the value that it had gained since it hit its 52-week low in the end of February. Meanwhile, the company's market cap has stayed relatively small compared to other companies with far less to offer.

  • cash: $1.1 million
  • current assets: $1.5 million
  • current liabilities: $4.8 million
  • quarterly net loss: $3.5 million

For an early development stage company these numbers are pretty good considering it might be some time before the company can actually be capable of generating revenues.

So PPCH certainly checks the "undervalued" box as we see it.

PPCH has made several research breakthroughs as well identifying patent opportunities for its PRP treatment. The company is also applying for orphan drug designation for pancreatic and ovarian cancers in the United States and Europe giving PPCH market exclusivity for up to 7 to 10 years, ongoing regulatory advice and discounted fees on regulatory submissions.

The company also plans to submit a clinical trial application (CTA) for late stage cancer patients with solid tumors in the UK, early 2017.

PPCH could be a very attractive buyout candidate for a larger biotech firm. Especially as the company continues to pile up patents and makes progress on Orphan Drug designation as well as clinical trials for the PRP treatment.

Another biotech that may be at an excellent entry point is Cellectur Biosciences (CLRB) which is about 90% off its highs but released some huge news Friday about a patent application which could bring this stock right back to its highs. Investors should monitor this situation.

PTC Therapeutics, Inc. (PTCT) is also off of its highs, but has been bullish recently. On the 16th of May the company announced the recipients of the Company's global STRIVE Awards (Strategies to Realize Innovation, Vision and Empowerment) program, designed to support nonprofit organizations serving the cystic fibrosis (CF) community. The announcement coincided with National Cystic Fibrosis Awareness Month celebrated throughout the month of May.

Celldex Therapeutics, Inc. (CLDX) released a couple abstracts ahead of the ASCO meeting, detailing its treatment for patients with high-risk melanoma. Essentially, the abstracts evaluated its treatments CDX301, a recombinant human Flt3 ligand (Flt3L), plus vaccination with CDX1401, a fusion protein consisting of human monoclonal IgG1 antibody targeting the dendritic cell (DC) receptor linked to the tumor antigen, in a Phase 2 study. The company noted that both treatments were well tolerated and preliminary analyses showed substantial increases of innate immune cells. Data from all 60 patients in this study will be presented at the meeting.

Shares of Celldex were last seen up 3.8% at $4.08, with a consensus price target of $14.18 and a 52-week range of $2.96 to $29.94.

Chimerix, Inc. (CMRX) is testing its experimental drug brincidofovir in patients with adenovirus (AdV) infection and reported interim top line data Monday. Chimerix CEO Dr. M. Michelle Berrey focused on the results in which brincidofovir showed an antiviral effect in patients with adenovirus infection.

OncoSec Medical Incorporated (ONCS) is a biotechnology company, designs, develops, and commercializes gene therapies, and therapeutics and proprietary medical approaches to stimulate and guide an anti-tumor immune response for the treatment of cancer in the United States. ONCS recenly presented long-term, data of patients who were treated with its investigational therapy ImmunoPulse? IL-12 and later went on to receive an anti-PD-1/PD-L1 therapy.

These data suggest that ImmunoPulse? IL-12 may prime and enhance response rates to PD-1/PD-L1 blockade.

All of these companies could provide you with excellent opportunities.

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[1] Source: http://www.marketwatch.com/story/four-reasons-for-investors-to-buy-biotechnology-stocks-now-2016-05-19

SOURCE: ACR Communication, LLC