POSTED AT 2:41 PM EDT Wednesday, October 04
QLT stock in free-fall after lower revenue projected
Reuters News Agency
Toronto — Shares of QLT Inc. are in a free fall, down about 30 percent in the past two weeks, with at least one analyst ratcheting down revenue projections for the companies Visudyne anti-blindness therapy.
The shares topped the net losers on the Toronto Stock Exchange Wednesday, dropping 14 per cent or $13.50 (Can.) to $84.30 in mid-afternoon trading. On Nasdaq the stock was down $8 1/16 at $55 15/16.
Vancouver-based QLT's shares have dropped 30 per cent since Sept. 25, while biotech stocks on the TSE are off only 6.5 per cent.
QLT is currently marketing its Visudyne therapy with partner Novartis AG in the United States for the treatment of wet age-related macular degeneration, a leading cause of blindness in the elderly.
The U.S. Food and Drug Administration fast-tracked the company's marketing approval because no other treatment existed for wet AMD, raising hopes among doctors, patients and investors that QLT had the cure.
Robert Uhl, head of equity research at investment bank Leerink Swann & Co. in Boston, told Reuters he downgraded the shares from a "speculative buy" to "hold" because of a recent physician poll conducted by his firm.
Forty retinal surgeon practices in the U.S. told Leerink that they now expect about 17 per cent of their wet AMD patients to use Visudyne, compared with a prior response rate of about 27 percent, said Mr. Uhl.
"We don't know why. But maybe it's because they have had more experience with the product and they were a lot more excited at the beginning," he said.
Now that physicians have worked with the product and have assessed its usefulness among their patients, they have concluded that fewer eligible patients will actually use the treatment, he said.
Based on this response, Mr. Uhl lowered his revenue projections for QLT by one-third to $206-million (U.S.) from $309-million in 2001, and to $287-million from $458-million in 2002.
"The number of patients dropped by 30 per cent. We still believe there are approximately 200,000 cases a year, but the net result is it made us reduce our forward-looking sales numbers," added Mr. Uhl.
The stock's downturn also coincides with the departure of the company's chief financial officer, Kenneth Galbraith, Sept. 7. QLT said the 37-year-old Galbraith will remain with the firm on a part-time advisory basis until April, 2001.
QLT is also in the process of seeking approval from U.S. and European regulators for other uses of Visudyne in treating eye diseases. |
