Biogen Or Bluebird: Which Will Lead In SCD?

On April 29, Joshua Schimmer of Piper Jaffray released a report highlighting several biopharmaceutical companies tackling Sickle Cell Disease, or SCD. The hereditary blood disorder is recognized by abnormal hemoglobin in the blood. Schimmer believes that to cure SCD with gene therapy, only “a very small percentage of the cells need to be successfully corrected to essentially stop the disease process.” The analyst believes that bluebird bio Inc BLUE and Biogen Inc BIIB have therapies that should “prove successful for patients,” but he has unique considerations for each.

Joshua Schimmer has a 58 percent overall success rate recommending stocks with a +12.9 percent average return per recommendation.

Bluebird Bio

LentiGlobin, Bluebird’s pipeline gene therapy for SCD, is currently in Phase 1/2 testing in the United States, France, and Australia. Schimmer notes that BLUE’s stock price has increased more than 500 percent since “the release of the first two beta thal pts treated with LentiGlobin last June.” The analyst believes that LentiGlobin will bring in more than $1 billion per year in the United States alone. For now, Schimmer notes the near-term investment opportunity in BLUE. However, he notes potential risks such as LentiGlobin’s failure to achieve targets in testing.

Joshua Schimmer maintained an Overweight rating on the stock with a $186 price target. He has only rated the stock once before in February, earning an +18.9 percent average return on the recommendation.

On average, the top analyst consensus for BLUE on TipRanks is Strong Buy.

Biogen

Schimmer also analyzes the pipeline drug developed in partnership between Biogen and Sangamo BioSciences SGMO, though he focuses his analysis on Biogen. The two companies are working on a ZFN approach to target BCL11a, meaning the use of artificial enzymes to target a specific protein. Schimmer notes that this approach offers “a viable alternative” to LentiGlobin. If the product is successful, Schimmer believes that “even modest penetration” in the market will deliver over $1 billion.

Joshua Schimmer currently has an Overweight rating on Biogen with a $484 price target. He has rated the stock 6 times since January 2010, earning a 67 percent success rate recommending the stock with a +6.0 percent average return per BIIB recommendation.