Idenix May Have 'Best-In-Class' Hepatitis Treatment
Peter Kang, 10.04.05, 2:30 PM ET
Morgan Stanley raised the target price on Idenix Pharmaceuticals (nasdaq: IDIX - news - people ) to $29 from $27 and said the biotech firm's experimental hepatitis B drug telbivudine has the potential to be a "best-in-class" drug, given recent data.
Monday, the company reviewed data to be presented for telbivudine, as well as hepatitis B treatment NM-283, that will be presented at the American Association for the Study of Liver Diseases (AASLD) meeting on Nov. 11-15.
"The data were positive and give us confidence that both compounds are approvable and have a commercial role in hepatitis therapy," said Morgan Stanley. "Telbivudine will compete with Bristol-Myers Squibb's (nyse: BMY - news - people ) Baraclude, and today's Phase III data suggest the drug has the chance to be the best-in-class molecule based on its safety and efficacy profile."
The research firm said that while NM-283 may not have the same efficacy as experimental drug VX-950, developed by Vertex Pharmaceuticals (nasdaq: VRTX - news - people ), the drug's "adequate activity" and safety will likely make it an important part of combination hepatitis C therapy. "Most important, the operating leverage from the two compounds offers significant economic returns," it said.
Morgan Stanley maintained an "overweight" rating on the stock. "With two credible compounds in late-stage development, Idenix continues to offer significant opportunity for value creation," said Morgan Stanley. "We view Novartis' (nyse: NVS - news - people ) NM283 in-licensing decision as the next inflection point for the stock and recommend investors stay long going into that event (early in 2006). . . Novartis' participation could push the stock past our price target into the low $30s."
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