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Stock Analyst Update

Unlocking the Genome

Achievement for science doesn't signal automatic buying opportunity.

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A major step forward for biology and medicine--the first complete working draft of the human genetic code--was announced early Monday by officials from the government-sponsored Human Genome Project.

From a financial standpoint, however, such an achievement will not translate into immediate profits for genomics companies. Many firms seeking to profit from the mapping of the human genome, including PE Corp-Celera Genomics (CRA) and Human Genome Sciences (HGSI), are still probably several years away from profitability.

One of the most interesting developments at the press conference at which the long-expected announcement was made was the public reconciliation between Francis Collins, head of the Human Genome Project, and Celera president J. Craig Venter. The federal program and Celera have been in a much-publicized race to complete the mapping of the human genome and had exchanged sometimes-heated rhetoric. But Collins and Venter congratulated each other Monday on their respective achievements.

Venter also indicated that Celera would participate in another press conference at 11:30 a.m. Central time Monday to announce the company's completion of the first assembly of the human genome.

Despite the announcement, Celera's stock was trading down more than 13% in intraday trading--an indication of the highly volatile and speculative nature of the genomics companies.

Emily Hall does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.