By George Budwell | More Articles
December 26, 2013 | Comments (0)
Good morning, fellow Fools! It's time to check in on the movers and shakers in health care today.
Will Ariad continue to rally?
Ariad Pharmaceuticals (NASDAQ: ARIA ) looks to continue its rally today following the announcement last Friday that the U.S. Food and Drug Administration, or FDA, approved a revised Prescribing Information and a Risk Evaluation and Mitigation Strategy for the company's leukemia drug Iclusig. Per the revised label, Iclusig can now only be prescribed to patients with chronic myeloid leukemia who have failed to benefit from or are ineligible to take other alternative therapies, including Novartis AG's (NYSE: NVS ) Gleevec. Gleevec is currently a first-line treatment, whereas Iclusig is now a treatment of last resort in many ways.
What's my take? It's important to understand that Ariad shares have now rebounded more than 200% since imploding upon the FDA placing a partial clinical hold on Iclusig last October. Even more importantly, you should keep in mind that Iclusig is not a game-changer for Ariad. Despite being the company's only commercially available drug, Iclusig raked in less than $17 million in the third quarter, giving the company a $66 million net loss for the quarter. Given that Ariad's market cap is now a staggering $1.3 billion following this rally, I think Foolish investors would best be served by taking a pass on this one.
www.fool.com/investing/general/2013/12/26/...aspx#.Urxc4DX9xBw