Bluebird Bio (NASDAQ:BLUE)
- Experimental Beta-Thalassemia Major Therapy shows great promise
- 4 patients transfusion free after treatment with LentiGlobin
- Stock Soars 100%
- Investors now expecting great things in Sickle Cell Disease
- How You Could Have Been Ahead of the Curve
Working on a Cure for Beta Thalassemia Major
Bluebird Bio (BLUE) is working on a cure for beta thalassemia major - an inherited blood disease that normally requires patients to have blood transfusions every few weeks because their body does not produce enough hemogliobin to carry oxygen throughout their body.
Bluebird's therapy, Lentiglobin, is not a long-term maintenance therapy. It is a potential CURE for Beta Thalassemia. This is a new class of therapies being developed by biotechnology companies. It is a gene therapy that corrects the underlying genetic disorder and therefore leads to what might be a long-term cure.
The therapy is in early testing and may still take years to be approved by the Food and Drug Administration (FDA), but early data are very promising.
Transfusion Independence
At the December 2014 American Society for Hematology conference (ASH), BLUE reported that the first four patients no longer need blood transfusions within weeks after a single treatment with Lentiglobin.
If proven out in wider testing, this therapy could help people become free of a disease they are born with. Truly a paradigm shifting development.
Sickle Cell Disease Next
Investors are now looking at Bluebird's ongoing sickle cell disease clinical trial. Sickle cell disease is another serious genetic disorder with no cure. In this condition, a person's red blood cells take on an elongate and curved shape instead of being round. The misshapen red blood cells cannot carry oxygen as effectively as normal blood cells.
Investors are now hoping that Bluebird can produce results in sickle cell disease similar to what they are accomplishing in Beta Thalassemia.
Stock Move
The day the Beta Thalassemia results became public, Bluebird's stock soared from a closing price of $48.89 to as high at $75. The run continued throughout the week as seen in the chart below:
How You Could Have Been Ahead of the Curve
As biotech investors, we all want to know what stocks to buy BEFORE they make large moves.
As explained in our Free Video Training Course "Mastering Biotech Binary Events", stocks move the most when reacting to UNEXPECTED NEWS. In the case of BLUE, the market simply was not expecting the news of 4 people being cured of a genetic disease they were born with.
However, there were 2 ways that you could have gotten ahead of the curve on this move in BLUE - the hard way and the easy way:
The Hard Way
The first way would be to do in-depth due diligence and follow the news flow of the company. Back in June, BLUE provided an initial update from their clinical trial where they indicated that 2 patients had become transfusion independent.
There were legitimate question still outstanding such as: "Had these two patients simply been cherry-picked for responding?" and "Was the transfusion independence merely a short-lived effect that would wear off over time?"
If you followed the company's news however, you would have noted that during their Q3 earnings report, BLUE confirmed that the two patients initially reported upon were still transfusion independent. In other words, the therapy appears durable - at least out to 9 months. The company also sad they would be reporting on 3 additional patients during the American Society for Hematology Conference.
In other words, the company gave you a hint that you should be buying the stock ahead of their update at ASH.
The Easy Way
The simple and easy way to Get Ahead of the Curve was to leverage the time and talent of experts. In our December issue of the Red Acre Biotech Binary Event Watch (BBEW), we covered BLUE. Here is what we told our subscribers in the "Actions Summary" potion of the newsletter:
Scale in ahead of ASH - buy any dip afterwards own it ahead of sickle cell data. Charts want to break upwards
It's no accident that we recommended scaling in to BLUE. Our internal analysis indicated that the ASH update may be the early trigger point for a massive move in the stock. BLUE may still have a long way to run if their therapies prove to work in sickle cell disease. While there are only 1000 Beta Thalassemia Major patients in the USA, there are approximately 100,000 sickle cell disease patients. This represent a potential $50 billion to $100 billion market opportunity.
But clearly owning the stock ahead of ASH was the right call because there was unexpected good news. Here's a snapshot of what we said about BLUE in the December issue of the Biotech Binary Event Watch:
Take Away Lesson
Whenever a company is working on potentially game-changing technologies.
The very first results they report might not be the real trigger point for the stock.
But this is the perfect time to put the stock on your watch list and start following the news flow. The company will let you know when the next major update is coming, and you'll be able to scale in (buying in bit by bit) ahead of time and own the stock when the second major update is announced.
If the second update confirms the preliminary reports, AND if the technology is truly game-changing, then the stock is likely to sky-rocket the way BLUE did.
That's the formula for how to Get Ahead of the Curve with stocks that are working on GAME CHANGING technologies.
