Galena Biopharma Inc (GALE), Oncolytics Biotech, Inc. (USA) (ONCY): 2 Drugs With Acquisition Potential

A retrovirus

Oncolytics Biotech, Inc. (USA) (NASDAQ:ONCY) is a Canadian biotechnology company that focuses on the development of oncology treatments.

Its primary candidate is Reolysin, a formulation of the retrovirus already present in most humans but does not show any adverse symptoms. The company has tested Reolysin in approximately 32 different trials out of which 16 have already concluded. This formulation of the Reolysin retrovirus attacks cells that have RAS pathways and according to studies almost 67% of all cancers are RAS-activated. This fact is a testament to the huge potential of Reolysin.

The stock has lost almost 50% of its value since February after rising on positive Phase III trial data on Reolysin treatment of head and neck cancer. Massive profit taking after a substantial rally is the primary reason behind this 50% slide. The trigger was the company announcement that it planned to make a public offering of common shares.

Oncolytics Biotech, Inc. (USA) (NASDAQ:ONCY)’s potential is immense, and it’s a perfect fit for any major player looking to expand its Oncology franchise. The stock is highly undervalued at current prices and offers a 70% upside on mean sell side target price of $6.5.

Bottom-line

The demand for small biotechnology companies with promising candidates is high. Any news or indication of an acquisition deal can result in a huge rally and this makes them a very good investment.

Mohsin Saeed has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article 2 Drugs With Acquisition Potential originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.