Growth Stock Soars To New Highs On Lung Disease Breakthrough

Growth stock Regeneron Pharmaceuticals (REGN) broke out in strong volume from a flat base and 800.58 entry this week. News of the first breakthrough in a decade for a leading cause of death drove the biotech to new highs.

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On Thursday, phase 3 clinical trials showed successful results for Regeneron’s Dupixent in treating chronic obstructive pulmonary disease (COPD). This inflammatory lung condition blocks airflows, contributing to a number of degenerative symptoms.

Patients using Dupixent reported 20% fewer repeated occurrences of persistent cough and breathlessness over the yearlong study.

The biotech blue chip developed the compound with French drugmaker Sanofi (SNY). Dupixent is already approved for asthma and certain skin conditions and now awaits approval for COPD.

According to Regeneron Chief Scientific Officer George Yancopoulos, “COPD is a notoriously difficult-to-treat disease due to its heterogeneity.”

Growth Stock Has Strong Technical Ratings

The growth stock has a robust technical profile, with dual 90 Composite and Relative Strength Ratings. However, sales and earnings growth have eased, lowering the Earnings-Per-Share Rating to 66, according to IBD MarketSmith.

On Friday, Jefferies upgraded the stock to buy from hold with a 925 price target, expecting the COPD breakthrough to be a $4 billion sales opportunity for Regeneron.

The company already manages a pipeline of drugs used in the treatment of macular edema, glaucoma and diabetes-related eye conditions that are leading causes of adult blindness. Outside the U.S., it works through Bayer HealthCare.

The growth stock is in the Medical-Biomed/Biotech group, which ranks 42nd among IBD’s 197 industry group.

Mutual funds own 64% of the stock. And more funds have been buying the stock over the past eight quarters, adding to the bullish outlook.