Folks, this is one of the semi-annual Agouron give-aways. By that I mean, once or twice a year Agouron has very sharp sell-offs which are based upon stories which do not have much substance. The latest sell-off is a case in point. In less than 2 weeks, Agouron has fallen from 56-1/4 to 46-1/4, the equivalent of 20 points on the pre-split stock. The volume yesterday was heavy but not really climactic. Combine yesterday's volume with today's and you get approximately 3.5 million shares having traded 46-1/4 low to roughly 49 high. This to me is an important buying point. It is a very low risk entry point.
As far as the story about poor Viracept results at a late breaker are concerned, Jay Silverman, the analyst at Robertson Stephens and Company, correctly points out that this was a very small study of 8 patients who had failed Viracept and were retreated with other Protease Inhibitors, and had mixed to negative results. This, he points out, is in contrast to an abstract being presented Wednesday of 9 failed Viracept patients treated with other Protease Inhibitors and responded beautifuly. (7/9 went undetectable.) He spoke with the lead investigator about the negative trial, and it appears the average patient enrolled had failed 5 anti-retroviral drugs. In other words, they had accumulated mutations from other regiments. The fact that any patients at all responded from this patient pool is favorable in and of itself.
Thus, to sum it up, Viracept had great results at the ICAAC Conference. A small late-breaking abstract seems to have been blown totally out of proportion and created a great buying opportunity. Since Agouron will be reporting earnings after the close on October 7th, I think we are going to see a dramatic rally in a company who is doing nothing less than underpromising and overdelivering, which went down for the wrong reasons.
I own the stock,, and therefore hope that I am right. Good luck to all. Cheers! |
