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Biotech / Medical : CVTX - CV Therapeutics, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: fred hayes who wrote (344)	11/7/2008 12:20:40 PM
From: tom pope	Read Replies (1) \| Respond to of 411

Merrill - underperform. Label update essentially as expected Ranexa continues to be indicated for “treatment of chronic angina,” but the language restricting it from first-line or monotherapy usage has been removed. There is, however, still a warning (albeit significantly softened) about QTc prolongation. The label also states that a significantly lower incidence of arrhythmias vs. placebo was observed, but there was no clinical benefit from this reduction. Finally, the label indicates that Ranexa causes “small reductions” in HbA1c (diabetes), but it “should not be considered a treatment for diabetes.” See page 3 for label change details. Because the label changes are in-line with our expectations, we are not changing our Ranexa forecasts based on this news. However, we did bump Ranexa sales a tad following 3Q results (see below). 3Q Ranexa sales slightly above; EPS miss due to tax Ranexa sales were $30.3M vs. our $29.3M estimate. GM as % of Ranexa sales was 82.7%, vs. our 82.5%. Costs and expenses excluding COGS were $51.9M, vs. our $55.8M (R&D was above and SG&A was below). EPS was ($0.41) vs. our ($0.39), partly due to $5.2M tax for upfront payments received. See variation analysis on page 3 for details. Model adjusted; expenses to grow on increased marketing We bumped US Ranexa sales as follows: ’08E from $111M to $113M, ’09E from $145M to $153M, and ’10E from $168M to $177M. We changed our EPS estimates as follows: FY08E from ($1.33) to ($1.41), ‘09E from ($1.27) to ($1.70), and ‘10E from ($0.98) to ($1.50). Importantly, we raised ‘09E costs and expenses excluding COGS from $220M to $260M based on management’s estimates.