How do you make a biotech stock gain 77% in one day? Have the company unveil a potential treatment for swine flu that (1) works, and (2) doesn’t cause a host of side effects in a swine flu patient that could actually make their illness worse rather than better. Take CEL-SCI Corp. (CVM) as an example. This stock - which had been off the radar for a while - made some big waves on Friday when it gained 77% following an announcement that their L.E.A.P.S. technology could possibly be adapted and turned into a very effective swine flu vaccine.

Exciting? Yep, but a little background may be in order to fully grasp what CEL-SCI offers to investors…. it’s not just a potential swine flu drug.

We actually recommended CEL-SCI back in January, when shares were trading at 27 cents.  For those who stepped in then, you’re up about 50% now. But, the basis of our recommendation wasn’t a swine flu treatment (which wasn’t even needed then). It was Multikine - the company’s impressive head and neck cancer treatment that’s on the verge of entering Phase III testing.

Biotech stocks are funny creatures though. As I mentioned in a column yesterday evening, the group is either hot, or cold… there’s no in between.

Back in January, the biotech environment was fairly cold. No capital-raising deals were being done, lending (and therefore acquisitions and expansion) had dried up, and the stock market was retreating. That’s quite a headwind, so we weren’t surprised to see so many of these stocks struggle. All tings considered, CVM’s sideways movement during that time was a relative victory.

Then, like the flip of a switch, a combination of the swine flu outbreak and the acceptance of immune therapies by mainstream medicine (thanks to Dendreon’s success with its prostate cancer treatment Provenge - an immune therapy) turned the biotech sector’s stocks ‘on’ again. If history holds up, they’ll stay on for quite a while, offering investors a chance at superior gains.

Now recognizing the wind is at our back, let’s fast forward to today.

We knew last Friday that CEL-SCI’s L.E.A.P.S. technology could work as a swine flu treatment, and we saw the stock rally as a result.

As of just a few moments ago, CEL-SCI announced they would indeed be developing a swine flu-specific L.E.A.P.S. treatment. As they put it, “expanded testing”.

On the surface, today’s press release may just look like a repeat of Friday’s news, but it isn’t. The theme is the same… L.E.A.P.S. is adaptable into several treatments, such as a vaccine for avian flu, Spanish flu, and now swine flu. What’s different, however, is that the work CEL-SCI is beginning is designed to fight not just the current strain of swine flu, but any possible mutations that could occur between now and the thick of the next flu season.

The possibility of mutations wasn’t discussed much when swine flu hysteria was running rampant in late April. The rush was to get a treatment on the market fast…. any treatment. Whether it worked great or just barely worked at all was irrelevant - just get it made. And, Sinovac Biotech Ltd. (SVA) seems to have won the initial race….  they’re mass producing a vaccine already.

All well and good, but as I said last night, biotech can’t be rushed. The Sinovac vaccine may work great against a mutated form of H1N1. Or, it might not work at all. One thing I am relatively certain of though….H1N1 will eventually mutate, and could possibly render many vaccine candidates obsolete.

CEL-SCI’s answer to that possibility? Prepare for a mutation now by creating a vaccine that’s able to fight not just the current virus, but the virus strain we could be seeing when swine flu comes around again this winter.

I suspect we’re going to see the stock go wild again today on the news. I hope you were in a position. Our readers have been in since January, finally being rewarded for their patience.

By the way, as impressive as CEL-SCI’s L.E.A.P.S. platform is, that’s not even the highlight of their R&D. Given that biotech in general is back in favor, I’m going to put CEL-SCI front and center again for our readers, as I think it’s one of the best small cap opportunities out there right now. If you want to learn more about what I think’s going to put CEL-SCI up on the same pedestal as Dendreon, stay tuned.

By the way, here’s today’s press release.
Do you want to be informed when CEL-SCI makes its next big announcement? How about exclusive interviews and insights from the company’s management? Get the comments and information you won’t get anywhere else by subscribing to our free newsletter today.