I tend to agree with this analysis. bluebird bio is a popular stock and they admittedly do some really cool science. They have plenty of money, which is very rare for a biotech with no marketed products. They have two products in phase III trials that use viruses to reprogram stem cells in patient’s and there is a decent chance they both get approved.

The pause I have with BLUE is that BLCM is tackling the same diseases in a similar way and some early clinical data suggests that their therapy is superior (10 out of 10 complete responders vs. 4 out of 7 for BLUE).
BLUE is about 2 years ahead of where BLCM is so I could see BLUE getting approved for their LentiGlobin and Lenti-D therapies and their stock price goes up temporarily. At 3.5 billion market cap for BLUE, investors have already baked in a high probability of approval into the price. However in the long term I could see BLCM ruin the party a couple of years later with a superior product and the BLUE stock would need to rely on one of their early clinical drugs panning out to stay viable.

That early clinical T-cell cancer therapy stuff looks promising too (both companies are doing it) but a lot of other biotechs are doing this as well. It’s a crap shoot on who will be the first to market and whether or not it ends up working well.

In summary, bluebird bio has a good chance of going up over the next 1-2 years but I think their long term prospects are too uncertain to buy in at their current price. BLCM has money issues like most of the biotech stocks but their science is equally or more as exciting as what I see from BLUE but at a fraction of the price. Certainly it’s risky to buy a company who is always one year away from running out of cash and doesn’t have any late stage clinical data yet. The science is impressive enough to take a gamble on in my opinion.

One other thing I should note, as if I haven’t given you enough to worry about, is that the recent advances in CRISPR technology could make the virus vector technology from both companies obsolete in the long, long term.

Any other thoughts or opinions on these two?

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