Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Elan Corporation, plc (ELN) -- Ignore unavailable to you. Want to Upgrade?

To: IRWIN JAMES FRANKEL who wrote (10037)	10/31/2008 9:38:53 AM
From: tom pope	Respond to of 10345

Merrill (BIIB oriented) BIIB to face headwinds from first U.S. Tysabri PML case Yesterday, Biogen Idec reported that the third case (since re-launch) of a rare brain infection (PML) occurred in a U.S. Tysabri monotherapy Multiple Sclerosis patient. Little was disclosed about the patient’s clinical course or prognosis other than that the patient had received 14 rounds of monotherapy, suggesting an exposure time of ~14 months. The patient received several rounds of plasmapheresis after the diagnosis was suspected, but it is unclear whether the patient remains hospitalized. While another case of PML was highly anticipated and reflected in our estimates, we believe BIIB shares will be pressured, especially in the current risk-adverse climate. We have not lowered sales estimates or adjusted our Tysabri patient model, but contracted multiples to reflect a continued overhang on BIIB. Our new price objective is $42 from $51. Ability to alter clinical course with vigilance important The 2 prior cases in the E.U. were not fatal following clinical vigilance. The E.U. does not have a formal risk map like the TOUCH program in the U.S. Therefore, we await further clarity on the clinical course of the U.S. patient to assess the ability of this program to alter the course of the disease. An ability of TOUCH to significantly alter the prognosis of PML is important, and may temper the stigma associated with this disease (and acceptable rate of occurrence). The company is hosting a round table tomorrow--we hope to gain incremental granularity. Despite foresight, BIIB likely to be pressured Another case of PML was widely anticipated, and we doubt that the regulatory authorities will take action other than minor revisions to the label. While BIIB is trading at a compelling multiple, the threat of PML will likely remain an overhang. We believe BIIB shares will continue to Underperform until Tysabri’s outlook is clear.