Shares of Celgene Corp. [NASDAQ:CELG] soared 10.69% to an intraday high of $135.98 share on Wednesday, after it announced strong preliminary second quarter 2015 earnings and revenue results and the acquisition of relapsing multiple scerosis (RMS) and inflammatory bowel disease (IBD) drug developer Receptos Inc. [NASDAQ:RCPT] for $7.2 billion. Shares of Receptos were also up 11.05% for the day. The acquisition of Receptos will give Celgene access to the drug Ozanimod, for the treatment of ulcerative colitis (UC) and multiple sclerosis (MS), with estimated peak annual sales of $4-6 billion. Receptos does not currently have any FDA approved products in its pipeline and therefore does not have any revenue.

In the same press release, Celgene also announced its preliminary second quarter earnings of $1.23 a share, up 37% year-on-year, beating Wall Street’s expectations of $1.14 a share. Revenues came in at $2.28 billion, up 22% from the same period last year, beating expectations of $2.24 billion. Celgene raised its full-year adjusted EPS target to $4.75-4.85, from $4.60-4.75. Wall Street is expecting EPS of $4.74. Celgene will announce its second quarter 2015 results on July 23.

In April, Receptos completed the Phase II trial of Ozanimod for treatment of patients with moderately-to-severely active UC, a form of IBD that causes inflammation and ulcers in the colon. The company plans to initiate a Phase III study in UC and Phase II study in Crohn's disease (CD) in 2015. Receptos is also conducting two Phase III trials of Ozanimod in RMS. Each trial is a randomized, double-blind study designed to compare 0.5 mg and 1.0 mg of Ozanimod against Biogen’s [NASDAQ:BIIB] Avonex (interferon beta-1a) in approximately 1,200 patients with RMS.

Other Receptos pipeline candidates include RPC4046, for eosinophilic esophagitis (EoE), in a Phase II study with top-line results expected in the first half of 2016. EoE is a chronic allergic/immune-mediated disease with symptoms related to esophageal dysfunction, including food impaction and difficulty swallowing. RPC4046 is a humanized monoclonal antibody directed against interleukin-13 (IL-13), a target which has been validated in other related allergic indications. RPC4046 is designated as an orphan drug, meaning it is developed to treat a disease affecting fewer than 200,000 people, to treat EoE. 

Apart from Receptos, Celgene said in late June that they will pay Juno Therapeutics, Inc. [NASDAQ:JUNO] about $1 billion, $150 million in upfront payment and $850 million in purchases of Juno’s common shares, in exchange for a 10-year global collaboration for the development and commercialization of immunotherapies focusing on Juno’s Chimeric Antigen Receptor Technology (CAR T) and T Cell Receptor (TCR) technologies.

In the first quarter ended March 2015, Celgene reported total revenues of $2.08 billion, up 20.28% year-over-year and EPS with ex-items of $1.07, up 28.92% year-over-year. Wall Street was expecting earnings of $1.06 per share on revenues of $2.12 billion.

The company reported sales of their multiple myeloma drug, Revlimid, of $1.34 billion, up 17.4% year-on-year, in line with analysts' estimates of $1.33 billion. Revlimid now accounts for about 64.4% of Celgene's total revenues. On an operational basis, including the impact from both foreign exchange rates and hedging activities, Revlimid sales were up 19.3% year-over-year. 

Abraxane, a cancer drug indicated for the treatment of breast cancer, non-small cell lung cancer and metastatic adenocarcinoma of the pancreas, posted sales of $223.4 million, an increase of 20.9% year-over-year. Sales were short of the $246 million analysts had expected, on average.

Looking forward, Celgene reaffirmed its revenues to be between $9.0 billion and $9.5 billion in 2015 and raised adjusted diluted EPS in the range of $4.75-4.85, from $4.60-4.75, compared with analysts' estimates for $4.74 per share on revenues of $9.25 billion. Celgene forecasts Revlimid sales to climb 14.5% to between $5.6 and $5.7 billion, as the company gains wider approval for the different lines of treatment. 

For 2017, Celgene forecasts net product sales to be between $13 billion and $14 billion, and EPS of $7.50. The company expects to more than double its hematology and oncology sales in 2020 to $20 billion with an EPS of $12.5 per share.

Celgene signed a partnership in April with London-based AstraZeneca Plc [NYSE:AZN] to co-develop an experimental therapy for blood cancers and paid $450 million upfront to share rights to the anti-PD-L1 inhibitor, a new type of cancer drug that takes the brakes off the body’s immune system, helping it fight malignancies.

A headline risk could be the strong U.S. currency as Celgene sees the negative impact of foreign exchange on net product sales to approach $100 million in 2015.

From our technical analysis, the stock ran up in the first quarter of this year to an all-time high at $129.06 per share, when Celgene said its hematology and oncology sales would more than double by 2020. The stock just broke out the symmetrical triangle and the conservative price projection for CELG is $149.50 per share, determined by adding the width at the top of the pattern to the point of breakout. The projected price could be substantially higher if one takes the bullish flagpole into account. 

Disclosure: Long positions in CELG and BIIB. No position in any other stocks mentioned.