Just a minute, here's another MOGN item. This from Ende, the other was from the "morning meeting notes".
MGI Pharma
Opinion and Estimates Upgrade; Upgrade to BUY; Dacogen
Underappreciated & Aloxi Risks Discounted
UPGRADE TO BUY: We upgraded MOGN to BUY from NEUTRAL with a
price objective of $32. We have increased confidence that Dacogen will receive
FDA approval in Sept. and will provide the next leg of EPS growth. Importantly,
we believe the stock adequately reflects Aloxi sales risk.
Estimate 70-80% CHANCE OF DACOGEN APPROVAL: We believe Dacogen
has a 70-80% chance of FDA approval for MDS by Sept. 1st based on a phase III
trial with a response rate of 17%, which is similar to the 16% RR for which
Pharmion’s Vidaza was approved.
STRONG DACOGEN DATA AT ASCO: Also, we believe data from a study
testing a more convenient dosing schedule for Dacogen in MDS could be
presented at ASCO in May, which may suggest better efficacy than Vidaza.
RAISING DACOGEN & EPS ESTIMATES: We estimate that 11,000 MDS
patients in the US are eligible for aggressive therapy each year, potentially
providing Dacogen sales of $200 MM by 2010. We raised our Dacogen and EPS
estimates to reflect our increased confidence in the product.
ALOXI RISK PRICED IN: Although Aloxi sales growth have slowed, we expect
the drug to continue gaining share, albeit at a slower pace. Importantly, we
believe the stock reflects much of the risk associated with significant competition,
slow market growth, price erosion, and the recent increase in days sales
outstanding (DSOs). In addition, we believe the stock accounts for little upside
potential, which could occur with additional oncology clinic contracts.
Eric J. Ende |
