Medarex, MEDX
[Bear Stearn's view of Medarex for 2007. I must admit, that I am somewhat taken back by the comment that approval of MDX-010 would legitimize MEDX's platform. The success (if any) of MDX-010 has 100 times more to do with the choice of target than with the way the mAb was created].
We note that although recent options backdating issues have weighed on shares, along with the departure of the CEO due to historical options practices, we believe 2007 could mark a positive turn of events for the Company. We anticipate data release from the first of its three phase 3 trials for its lead drug, MDX-010 (ipilimumab) in metastatic melanoma, around mid-2007, from a 150-patient, 2nd-line monotherapy study. The primary endpoint for this trial is response rate. MEDX may also have data from a second phase 3 trial by year-end 2007 – a 2nd-line, 750-patient melanoma study assessing MDX-010 in combination with another MEDX vaccine candidate (MDX-1379), also with a response rate endpoint.
We anticipate positive data from its melanoma program, which could lead to its first major regulatory approval, and legitimize MEDX’s technology platform for the synthesis of fully human monoclonal antibodies, which we view as the best in the business. We also view the change in management, and the completion of earnings restatements, as lifting an overhang on shares. We reiterate our Outperform rating, and $17 year-end 2007 price target. |
