(FORTUNE Magazine) – WHAT WE SAID

In "Finding the Bulls in Biotech" (Feb. 4, 2002--see fortune.com) we said that the market was increasingly expecting biotechnology companies to have products and profits, not just drug ideas, and that winners were going to emerge. With that in mind, we highlighted five companies with packed pipelines and real potential for earnings growth.

WHAT HAPPENED

Our science was sound. The stocks we selected are up an average of 47% since the article appeared, compared to a 3% rise for the Amex Biotechnology index. The biggest winner so far is Genentech (DNA, $124). The grandaddy of all biotechs is up 156% based on the strength of its cancer drugs. It got another boost recently after a positive Phase III trial result for lung cancer drug Tarceva, which it's co-developing with Roche and OSI Pharmaceuticals. A smaller company that has also shown big potential with a cancer drug is Telik (TELK, $27), which is up 110%. Amgen (AMGN, $59), the world's largest biotech, has ridden steady revenue gains to a 5% rise. IDEC Pharmaceuticals merged with Biogen in 2003 to form Biogen Idec (BIIB, $58). Its stock is down 7%. Our most speculative pick, Abgenix (ABGX, $18) fell 31%. But it has a promising colorectal cancer drug in Phase III trials.

--Brian O'Keefe