Medicines Company

01/17/2014 8:00 am EST


Jay Silverman

Analyst, Medical Technology Stock Letter

Our top conservative idea for the company year is a biotechnology company that began a transformation last year and is expected to gain further momentum in 2014, observes Jay Silverman, editor of The Medical Technology Stock Letter.

The Medicines Company (MDCO) is delivering on its plan to become the leading acute care provider of medicines in the hospital setting—in acute cardiovascular care, surgical, and perioperative medicine, and hospital-based infectious disease.

At least three new products should begin global introductions this year—Cangrelor (intravenous platelet inhibitor), oritavancin (novel antibiotic for serious gram negative infections) and Fibrocaps (hemostasis)—and diversify the Company's sales and earnings stream away from Angiomax (anti-coagulant).

MDCO's management has proven, time and again, the ability to identify novel products that are both synergistic, and complement their current product line and R&D pipeline. A more recent acquisition, Rempex, exemplifies yet another value-added extension to this strategy.

The deal expands MDCO's reach into the bourgeoning market for novel drugs against multi-drug resistant gram-negative bacteria.

Next year should also bring clinical data on a number of R&D projects, notably from ALN-PCS (partnered with Alnylam)—which may be a differentiated compound in a major new blockbuster class of cholesterol reducing agents.

We are raising our buy limit on MDCO to $42 (from $35) with a target price of $60 (up from $50).

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