Agouron Pharmaceuticals (AGPH) Message Board

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Biotech / Medical : Agouron Pharmaceuticals (AGPH)

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To: PAL who wrote (4560)	6/26/1998 10:56:00 AM
From: mod	Read Replies (2) of 6136

Here is the text of their HOLD rating: PM Call: AGPH: Initiating Coverage With A Hold CS First Boston Shekhar Basu June 24, 1998 CREDIT SUISSE FIRST BOSTON CORPORATION Equity Research-Americas Industry: Biotechnology Shekhar K. Basu 212/325-6096 shekhar.basu@csfb.com Yasmine C. Nainzadeh 212/325-0588 yasmine.nainzadeh@csfb.com HOLD Agouron Pharmaceuticals (AGPH) Summary Agouron's Viracept has impressively achieved the #1 position in the protease inhibitor market for the treatment of HIV infection. Viracept's competition is already established protease inhibitors from Merck, Roche and Abbott. During its first year Viracept U.S revenues grew to $350 million. Aggressive treatment of HIV infection with protease inhibitors in combination with RTIs has became the standard of care after superior efficacy data was presented in 1996 compared to dual therapy with RTIs alone. Now, 50% of HIV infected patients on treatment are taking protease inhibitors, up from 36% a year ago. We expect the introduction of three new equally effective anti-HIV drugs in 1999: DuPont's Sustiva, Glaxo's 1592 and Vertex's Amprenavir in an HIV market growing at only 12% annually. The front-line treatment market of HIV infection is likely to experience more switching amongst the current therapies, especially as the knowledge of resistance patterns of existing drugs becomes more prevalent beginning in the second half of 1998. With the stock trading at only 2 times FY 1999 worldwide revenues and a short-position of 9 million shares, we believe that there appears to be uncertainty about the impact of the competitive scenario on AGPH's near-term earnings. We believe that data expected to be released from new products like the injectable Remune in Phase III studies in 1999, a cancer treatment drug in Phase III studies, and AG-7088 Phase I for the treatment of the common cold drug and strategic alliances could strengthen the stock. We are initiating with a HOLD rating.

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