Gilead shares gapped up 11.4% to an all-time high of 72.40 in three and half times average volume after announcing Saturday its experimental hepatitis C therapies showed a 100% cure rate.
Celgene shares leapt 5.4% to 75.36 in heavy volume after revealing late Friday that its Abraxane drug increased life spans of pancreatic cancer patients in a late-stage study.
BBH, with a 12.93% weighting in Gilead, sports a stellar IBD Relative Strength Rating of 84 and strong B- Accumulation-Distribution Rating. This shows that BBH's price performance is outpacing 84% of the market and institutions are heavily buying shares.
BBH soared 47.2% year to date vs. 9.48% for SPDR S&P 500 ( SPY ). The ETF is consolidating below its 50-day moving average and trades only 8% below its 52-week high, which is a normal correction.
IBB, with 7.29% in Gilead, is up 27.9% year to date. It has 77 RS and C- Acc-Dis Ratings. It's rebounding from a correction to its 200-day moving average, which is bullish.
100% Cure Rate
Foster City, Calif.-based Gilead, the world's largest developer of HIV treatments, said at the American Association for the Study of Liver Disease's annual meeting in Boston that its pair of experimental drugs -- GS-7977 and GS-5885 -- combined with a standard treatment called ribavirin cured all patients with a particular form of hepatitis C in a second-stage study.
"These data provide proof of principle that could position Gilead as best in class in efficacy, safety and convenience," Leerink Swann analysts Howard Liang and Gena Wang wrote in a client note Monday, rating the stock outperform.
Credit Suisse raised its price target on Gilead's stock. S&P Capital IQ raised its price target and maintained its buy rating.
"We expect Gilead shares to remain volatile due to what we view as a rapidly advancing and intensely competitive hepatitis C landscape," Steven Silver, an equity analyst at S&P, wrote in a client note Monday.
Achillion Pharmaceuticals (ACHN), Idenix Pharmaceuticals (IDIX), Bristol-Myers Squibb (BMY),Merck (MRK),Vertex (VRTX), Pharmasset (VRUS) and several smaller firms also make hep C drugs.
Celgene of Summit, N.J., -- the fourth-largest biotech firm, said it would elaborate on its Abraxane study at a medical meeting in January. The drug already has been approved to treat breast and lung cancer. Celgene acquired Abraxane when it bought out Abraxis BioScience in 2010 for $2.9 billion. A late-stage trial shows the drug also helps patients with melanoma live longer without getting worse compared with a competing treatment.
Leerink Swann rates Celgene outperform. Cantor Fitzgerald raised its price target and rated it buy.
S&P also raised its price target and maintained a buy rating. "We view pancreatic cancer among the most difficult cancers to treat and see this indication representing up to a $1 billion peak annual global sales opportunity," Silver wrote. "We remain confident in Celgene's growth prospects."
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