From IIonline.... UPDATE: CV Therapeutics Remains a Bargain
Tell us what you think in CVTX's
Eric Singer (3/31/99)
Last month, we advised biotech investors to consider CV Therapeutics (NASDAQ: CVTX), an off-the-radar play in the cardiovascular disease arena. With two compounds in late-stage clinical trials, we wrote that shares of CV were on the verge of a dramatic rise.
At the time, the shares traded for around $6, but looked poised to rise into the teens as the company's drugs ran through FDA scrutiny. It looks like we were premature. Today, the shares closed down $0.31 to $3.94.
Nevertheless, we still see the stock rising into the teens later this year. The share price weakness is not related to any fundamental developments at the company. and the company has released no news. This smells like a buying opportunity.
Over the next six months we expect to see pivotal clinical data from two CVTX compounds, CVT-124 and Ranolazine. CVT-124 is partnered to Biogen (NASDAQ: BGEN) and is being developed for the potential treatment of edema associated with congestive heart failure. Ranolazine is 100% proprietary to CV Therapeutics and is being developed for the potential treatment of angina. Based upon prior clinical data, we believe that there is a high likelihood of successful outcomes in both of these clinical trials.
Currently, the marketplace is affording no value to CVT-124, Ranolazine or CV Therapeutics' research and development pipeline. In our view, Ranolazine will be the key driver for the company. If the current Phase III trial is successful, we would expect CV Therapeutics to forge a partnership with a pharmaceutical company for the commercialization of Ranolazine.
Bottom Line:
With $44.8 million sitting in the bank, CV Therapeutics looks like a steal. Thanks to the recent sell-off, the stock's market cap is just $44.1 million.
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