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Company Description-

Based in Cambridge, Massachusetts, Merrimack Pharmaceuticals (MACK) is a bio-pharmaceutical company that specializes in creating drugs and treatments for cancer. They focus on utilizing innovative technology and research processes to create new drugs that they hope will help patients and eventually lead to cures for cancers. They have a strong belief that one day cancer will be defeated and they hope to be the ones to aid in that victory. Their treatment research specializes in specific cancers and in cancer in general. Merrimack utilizes an interdisciplinary approach to drug discovery and development that enables them to build functional and predictive computational models of biological systems based on quantitative, kinetic, multiplexed biological data.  By thoroughly researching about how cancer adapts and becomes resistant against treatment, as well as how it continues to spur growth, Merrimack hopes to find treatments that can counteract the ways that cancerous cells spread.

Merrimack Workings-

Merrimack currently has six major drugs in clinical development. They also have two major ones in pre-clinical development. Of the six in development, two are in stage two of trials and MM-398 has risen to stage three of trials. Merrimack has an extremely large emphasis on research and has shown significant promise with many of its drugs so far. Besides creating new innovative drugs that Merrimack hopes will lead to cures, they also focus on using current drugs and coupling them with therapeutics to treat cancer and tumor patients as well as possible. Through combining diagnostic and therapeutic combinations, Merrimack attempts to find the best possible treatment for each disease and individual patient.

MM-398

Merrimack’s most successful current drug is MM-398, a drug which is currently in the third phase of clinical trials for its ability to treat tumors resistant to chemotherapy across multiple types of cancers, including lung and prostate cancers. Merrimack believes that they can get a better reaction and response from patients using MM-398 than traditional chemotherapy methods.  The FDA and the European Medicines Agency have now granted MM-398 orphan drug designation in 2011 in metastatic pancreatic cancer which is a massive step for the drug as it begins phase three trials. As Merrimack pushes to the future, MM-398 is a major part of their current trials and they hope it will present itself as a great product in the future of the company and a great way to provide treatments for cancer patients.

Stock Analysis-

Merrimack shows a lot of promise with their new MM-398 drug and other clinical and pre-clinical drugs. However, a great company doesn’t always signify a great stock. In Merrimack’s case however, the potential of the company is represented well by their stock and its value. The Merrimack stock is currently at $6.43 (as of May 2nd). This is up from $5.50 at the start of the year and up from $4.50 at the end of April. The stock has seen a great rise over the past two days due to recent results reported about their MM-398 trials. In phase three trials, the Merrimack drug MM-398 helped elongate pancreatic cancer patients’ lives two months longer than that of traditional chemotherapy patients. This is a significant success for the company and shows the promise that MM-398 has. The recent success Merrimack has had has led to increased analyst estimates about growth and revenue. The company is expected to grow in sales by 10% this year, and then a whopping 96% in 2015. If analysts are anywhere close to correct with these expectations, the company could expand greatly and see massive increases in revenues and in stock value.  The mean 1 year price target is around $11 dollars which signifies Merrimack could more than double its stock price within the year. Overall, I believe that this is a strong stock with a bright future and thus rate it a buy.  The rise in price may not come in the near future, but there is definite growth available for Merrimack within the next year or two and at some point, their stock price will fully reflect their fantastic potential. Merrimack is a stock that is currently undervalued and has a good chance to reap fantastic gains when their potential is fulfilled and their promising drugs hit the market. Image