Buy Incyte Genomics, Inc. (INCY) and Pharmacyclics (PCYC) Into ASCO Meeting

Nomura analyst M. Ian Somaiya is telling clients to buy Incyte Genomics, Inc. (NASDAQ: INCY) and Pharmacyclics, Inc. (NASDAQ: PCYC) following ASCO abstracts and into the meeting.

Somaiya comments, "We are buyers of INCY and PCYC following release of ASCO abstracts. The abstracts were in line with our preview and point to volatility in INCY and PCYC’s shares. INCY’s highly-anticipated Phase I/II data for its IDO1 inhibitor + BMS’s Yervoy (ipilimumab), demonstrated a 37.5% ORR (using a less stringent immune related response criteria) for the lower 25mg dose arm; below bullish estimates. We expect data from the 50mg dose arm (data on June 2nd) to meet investor expectations and help INCY’s shares recover. In addition, Incyte revealed use of C-reactive protein (CRP) as a biomarker in the Jakafi pancreatic cancer trial, confirming our view and suggesting peak US sales of $3.0bn in the refractory setting. For PCYC, we think investor focus will be on the higher CR and MRD (minimal residual disease) negativity rates in Phase I/II trial of competitor ABT-199 + Rituxan. The data were in line with investor expectations and should shift focus to the Imbruvica RESONATE Phase III data, which is expected on June 3rd."

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