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Why One Analyst Says This Stock Will Gain More Than 60% Over The Next 12 Months

Why One Analyst Says This Stock Will Gain More Than 60% Over The Next 12 Months

This stock has jumped 590% in the last 5 years, but one analyst says it’s still set to gain more than 60%. Here’s why.

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Shares of bluebird bio (NASDAQ: BLUE) have skyrocketed nearly 590% over the last five years.

And one analysts, John Newman of Canaccord Genuity, says there’s more room for the stock to run. Newman recently issued a Buy rating on BLUE with a price target of $250 – 70% above current prices.

He’s not alone, the average analyst price target for the stock is $212, implying upside of 44% from price as of this writing over the next twelve months.

And it’s no wonder why.

This clinical-stage biotech company is focused on developing transformative gene therapies, cancer immunotherapy, as well as gene editing to treat cancer and rare diseases.

BLUE has two products on the market, two drug candidates that are near commercialization, and four additional treatments in its pipeline.

bluebird bio’s gene therapy LentiGlobin just won an accelerated assessment of its Marketing Authorization Application from the European Medicines Agency (EMA). LentiGlobin is expected to become a onetime treatment to address the genetic cause of transfusion-dependent β-thalassemia (TDT) in patients with a β0 / β0 genotype.

“Transfusion-dependent β-thalassemia is a severe genetic disease that requires a lifetime of chronic blood transfusions for survival, and while these transfusions are life-saving, they are also associated with serious medical complications such as organ failure from iron overload,” bluebird bio’s chief medical officer, David Davidson, M.D., said. “Receiving accelerated assessment for LentiGlobin helps support our goal of delivering the first gene therapy to patients with TDT. We look forward to working in collaboration with the regulatory authorities on this potentially transformative treatment option.”

But LentiGlobin isn’t the only candidate showing such promise.

Just last week, the company announced updated results from its phase 2/3 Starbeam study of its investigational Lenti-D gene therapy in boys 17 years of age and under with cerebral adrenoleukodystrophy (CALD). Of the 31 patients in the study, 17 were treated with Lenti-D, and 88% of those patients were alive and showed durable lack of progression of major functional disabilities (MFD) after 24 months of followup.

The safety profile for the treatment was favorable as well as no acute or chronic graft-versus-host disease (GvHD) was found in the patients at the 24 month follow up.

“As a physician who treats boys with CALD, I see its devastating effects on young children and families,” Professor Paul Gissen, Consultant in Pediatric Metabolic Diseases at Great Ormond Street Hospital in London and an investigator in the phase 2/3 Starbeam study said in a press release about the the results. “Data from the Phase 2/3 Starbeam study suggest that Lenti-D, which utilizes a child’s own cells and does not require a matched donor, may be a potential treatment for CALD.”

Approval for both the Lenti-D therapy for CALD and the LentiGlobin treatment for β-thalassemia is targeted for 2020, catalysts that could push the stock far higher.

BLUE also has a strategic collaboration with Celegene (NASDAQ: CELG) to develop and commercialize disease-altering gene therapies in oncology settings, as well as a strategic partnership with Regeneron Pharmaceuticals (NASDAQ: REGN) to share each other’s best-in-class technology platforms to discover, develop, and commercialize various immune cell therapies for the treatment of cancer.

If bluebird bio is able to commercialize its core products and come to market with its promising late stage candidates, and as a result, grow revenue over the next five years by double digits, this biotech could be a blue ribbon winner.

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