Morningstar Rating

Stock Research and Analysis

by Stefan Quenneville, CFA

Bulls Say

The firm's cystic fibrosis program is poised to dominate this potentially lucrative market for the foreseeable future, based on the disease-modifying potential of the drugs, chronic use by patients, and a lack of competition.
Vertex has a recent track record of successfully launching drugs (Incivek and Kalydeco), which differentiates it from other emerging biotechs that have often faltered during commercialization.
Vertex's leading drug candidates were all discovered in-house, lending credibility to its drug-discovery technology and potential to generate additional pipeline candidates. Read more 

Bears Say

Significant value is being attributed to Vertex’s CF pipeline. Any missteps in bringing these drugs to market could limit the company’s financial flexibility.
The sky-high prices seen for orphan drugs like Kalydeco are unsustainable, particularly in austerity-minded European countries.
Incivek’s rapidly declining sales due to increased competition and recent safety issues seen with promising pipeline candidate VX-135 raise questions about the long-term strength of Vertex’s hepatitis C franchise. Read more 

Management

We award Vertex standard marks for stewardship. Dr. Jeffrey Leiden became the CEO and board chairman in 2012 after sitting on the company’s board for two years. Previously, he served as president and chief operating officer of Abbott Laboratories and   Read more 

Profile

Vertex Pharmaceuticals discovers and develops small-molecule drugs for the treatment of serious diseases. The firm's lead drug is Kalydeco for cystic fibrosis and has several   Read more 

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