FAC: CV Therapeutics, Inc. (CVTX - $ 13.86)
In-Line Quarter and a Route to a Broader Ranexa Label
Rating Buy
Current Price $13.86
52 Wk High: $36.65
52 Wk Low: $12.20
30-Day Avg Daily Vol: 977,098
Market Capitalization: $436.6M
Shares Outstanding: 31.5M
Cash: $415.7M
Cash/Share: $13.20
Debt/Capital: 62.55%
Book Value: $114.60M
Book Value/Share: $3.64
Net cash / share = $4.51
Action: We are reiterating our Buy rating on in-
line 2Q:04 results and an additional
clinical trial of Ranexa that, in our view,
increases the probabilitie of a front-line
label for chronic angina and possible
entrée to treatment of broader
cardiovascular conditions.
Key Points:
* We are reiterating our Buy rating on in-
line 2Q:04 results and an additional
clinical trial of Ranexa that, in our
view, increases the probabilities of a
front-line label for chronic angina and
possible entrée to treatment of broader
cardiovascular conditions.
* CVT reported 2Q:04 EPS of ($1.18),
compared to our estimate of ($1.09) and
the consensus estimate of ($1.17)
* Separately, the company announced an
additional trial that could lead to a
broader label than the registration
study, which is expected to result in a
second-line treatment label in 2006.
* Under an Special Protocol Assessment,
agreement, the company will conduct a
study in 5,500 patients with acute
coronary syndrome (ACS), that could
result in a label for both front-line
treatment of chronic angina and both
treatment and prevention of ACS in 2007.
* Even were Ranexa to miss the primary
endpoint, it could still gain the front-
line angina label, because the greatly
expanded safety data base would dispel
fears of arrhythmias due to QT prolongation.
* Although the study will keep the burn rate high, we consider it worthwhile based on what we would rate a good chance of expanding the angina label and a possibility of deepening the opportunity into the 1.7-million-patient ACS market.
Valuation: Our price target remains $20, based on estimated 2009 EPS of $1.14, a 50 P/E, and a 25% risk discount factor.
Company Description: CV Therapeutics is developing pharmaceuticals to treat cardiovascular disease. The company's lead product, Ranexa for chronic angina, received an approvable letter from the FDA in October 2003. The company is awaiting guidance from FDA regarding further development plans.
Regadenoson (CVT-3146) is in Phase III testing as a pharmacologic stress agent for use in cardiac imaging studies. |
