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Incyte, Puma may surge on drug news: Expert

Incyte stands to benefit from unveiling data on its cancer treatments at a key conference in the coming days, a biotechnology analyst said Friday.

Many big-name biotech and pharmaceutical companies will present drug developments at the American Society of Clinical Oncology annual meeting, which runs until Tuesday. Many treatments will focus on immuno-oncology, which directs the natural immune system to fight cancer cells.

"A lot of innovation" has taken place in that category of cancer therapy, said Eric Schmidt, a biotech analyst at Cowen and Co. He noted that Incyte may play a huge role in the treatment.

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The company makes a product that can combine with PD-1, or programmed cell death, treatments produced by larger companies like Bristol Myers Squibb, Merck and AstraZeneca, Schmidt noted.

"Of all the stocks we're following, Incyte's probably gonna be my top nominee to make it there with the PD-1s," he said in a CNBC "Power Lunch" interview.

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Incyte shares have jumped more than 50 percent higher this year.

He also outlined his expectations for Puma Biotechnology's "highly touted" breast cancer treatment. Puma shares plummeted this month when the company unveiled slightly disappointing Phase 3 results for its experimental drug.

Puma will present full data at the conference. Schmidt noted that the drug was "successful" based on early trials and "ought to be approved on that basis."

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