Here's Why Bluebird Bio (BLUE) Stock Skyrocketed Today

Shares of Bluebird Bio BLUE were up nearly 20% in early morning trading Monday as investors responded to the company’s announcement that its CAR-T candidate, bb2121, produced encouraging results in patients with a deadly blood cancer.

In a presentation at the American Society of Hematology Annual Meeting this weekend, representatives from Bluebird and bb2121 co-developer Celgene Corp. CELG revealed that 94% of patients with advanced forms of multiple myeloma exhibited positive responses to the therapy in a recent study. The two companies also reported that at least seven study participants were complete responders.

In addition to the therapy’s unprecedented efficacy, bb2121 displayed remarkable safety data. The latest study was relatively small, but Bluebird and Celgene plan to move the therapy into a larger, pivotal-stage trial soon.

If the two companies can get bb2121 on the fast-track to approval, the pair would become the third group to bring a CAR-T treatment to market. CAR-T is a newly emerging method of treating cancer that includes making genetic changes to a patient’s immune T-cells and reinjecting them into the body to attack cancer cells.

Novartis’ NVS Kymriah therapy, which treats lymphoblastic leukemia, became the first approved CAR-T therapy in the world in late-August, while Gilead’s GILD large B-cell lymphoma regimen, Yescarta, was approved in October.

Gilead acquired Yescarta when it purchased Kite Pharmaceuticals earlier this year, and now Bluebird’s CAR-T progress has many investors hopeful that it will be the latest takeover target in this space.

According to a note from Goldman Sachs analysts published in response to Bluebird’s recent results, the firm has emerged as an attractive acquisition candidate because of “its innovative and leading lentiviral-based gene therapy and CAR-T cell platforms backed by positive proof of concept data, which targets large blood disorders beta-thalassemia and sickle cell disease and multiple myeloma.”

Goldman raised its price target for the stock to $309 from $186. This new call would represent an 80.5% gain from Friday’s close, or an additional 39.5% surge from Monday’s opening price.

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