VPHM - Sector: Healthcare---Industry: Biotechnology & Drugs

[la-onda]

VPHM: JMP Sec Starts @ Mkt Outperform; Sets Tgt @ $25; Analyst Notes
Wednesday, October 19, 2005 08:15 ET

Issuer: Viropharma, Incorporated (NasdaqNM: VPHM)

Analyst Firm:  JMP Securities

Ratings Action: INITIATE

Current Rating: Mkt Outperform

Target Price Action: INITIATE
Target Price: $25.00

Analyst Comments: According to the firm, ViroPharma is a profitable, commercial-stage biotechnology company with one marketed product candidate, Vancocin. Vancocin was acquired in 2004 from Eli Lilly (LLY), and ViroPharma has made good use of the product by driving increased awareness and implementing price increases. They note that ViroPharma also has two development-stage products (HCV-796 for hepatitis C and Maribavir for CMV) that we expect will generate important news flow sometime around the end of the year. They believe that continued Vancocin sales growth along with progress from the company's pipeline should drive continued appreciation for the stock. They reach their $25 price target by applying a 25x multiple to their 2006 EPS estimate of $1.00.


http://www.knobias.com/individual/public/news.htm?eid=3.1.dc496b95f4b8b68502aa45b12295ecbe226b474e1401023b7c17c48836558492

[ScottishTrader]

Alright VPHMers,

thought I'd post this, as I think it gives us a good idea of whats been happening with VPHM over the last couple weeks.  Here's the 1 hr chart for the last 10 days, and as you can see, VPHM appears to be building a symmetrical triangle which we are coiling into right now.

While we may hit and fall back from the descending trendline tomorrow at 19.00, I would watch for a break out of this fformation in the next few days (possibly Fri or Mon??)  Whether we go to the upside or down, I'm not sure, but I would say that momentum probably still favours the upside.  At this stage I'm not doing anything until I see this triangle break.

Hope this helps 

[brandyjoco]

Thanks for the chart. What do you think will happen now after today's plunge?

[ScottishTrader]

As you can see from this chart, VPHM is still trending within the symmetrical triangle, but doesn't have much further to go.  Volume has been trailing off as we head into the neck of the triangle, so I expect we'll find out which way it wants to go tomorrow - I'm looking for an upside break, but if it breaks to the downside, posting anything below the trendline, which should mark 17.85 first thing, I'm selling.  Lower support is at 17.50, which it may get a bounce off, but I don't want to see that much exposure.

It has been trending a nearly perfect symmetrical triangle, so you gotta go with what the pattern tells you.  Good luck to all for tomorrow, lets hope its a better day than today 

[brandyjoco]

Wow, great chart. It looks like it hit the top of the triangle line since it closed at $18.53.

Is there anyone else out there holding VPHM? I thought the ride would be a little smoother.. it's been a little bumpy lately.

I think it has great fundamentals and there is a possibility that their drug Pleconaril for the common cold may go to Phase III with Schering-plough. Some news will probably be out on November 1 during an announcement.

[Prfsr Hal]

I am still holding it.  The euphoric talk of 40.00 pps has dissipated.  I'll be happy with 26.

Prfsr Hal

[ScottishTrader]

you better believe it - the price fluctuations today fit perfectly into the neck of the symmetric triangle.  Monday has to be breakout day.  If it goes north, we have a technical target of 22.  Watch for a breakdown though - a lot of stocks have been moving south lately, but the chart looks ripe for a solid move.

[calven]

Negative divergence. I certainly wouldn't short this stock just yet, but signs point to the slowing of the bullish uptrend.

[brandyjoco]

What do you think of today's breakout?  Will it hold?  Anybody holding VPHM ?

[Michael]

God knows why VPHM has been weak the last couple of weeks (and so do Melf Elf and David) but for the rest of us any weakness of VPHM has historically been a great buying opportunity and it seems that this is no exception.

It is a beautiful chart today. Nice increase with good volume - probably due to the increase in prescriptions last week. My feeling is that we have started the journey to Piper Jaffray's new $24 target. I will bet that before or when we reached it they will revise it again hopefully based on news from the pipeline.

If Viropharma was a woman I would marry her on the spot

Mike

[SmartWrasse]

I am holding again, but needs more volume to confirm a breakout.

[brandyjoco]

VPHM is finally moving. Almost broke $21.  The chart looks good. How is everyone doing?  I have 4000 shares....

[snowcat]

Earnings due out 11/7.  A good run prior to earnings could mean a fall after.  Regardless of the news.

[brandyjoco]

I need some help from my charting buddies.  I am trying to read charts and I am not sure what charts to use. But, from what I see is there an overbought RSI condition with a MACD line crossing into a negative situation? As you can see, I don't know what I am talking about... but what does the chart look like to you?  P.S.  last earnings VPHM went down for a week after earnings before picking up again.

[la-onda]

sounds awesome 
ViroPharma Announces Additional Investment for Vancocin Supply
Thursday November 3, 4:56 pm ET
Company Expands 2004 Manufacturing Agreement With Eli Lilly to Ensure Additional Safety Stock Inventory

EXTON, Pa., Nov. 3, 2005 (PRIMEZONE) -- ViroPharma Incorporated (NasdaqNM:VPHM - News) today announced the amendment of its manufacturing agreement with Eli Lilly and Company (Lilly) (NYSE:LLY - News) in order to increase Lilly's supply of Vancocin(r) to ViroPharma over and above the supply necessary to meet ViroPharma's expectations for product demand. ViroPharma will pay Lilly an additional amount of up to $4.5 million in addition to the original contract price through early 2006. This investment is representative of ViroPharma's effort to anticipate the potential for increased demand for the product, should the incidence and severity of Clostridium difficile infection continue to increase at a higher than expected rate. Vancocin is indicated for the treatment of antibiotic-associated pseudomembranous colitis caused by C. difficile.

This amendment is also intended to provide ViroPharma with an interim second source of supply to augment the company's third party supply chain, which is expected to be qualified during the first half of 2006. Lilly has agreed to continue to manufacture Vancocin through at least September 30, 2006. The amendment does not effect Lilly's obligation to continue to manufacture Vancocin for an agreed upon period of time in the event that the third party supply chain is not qualified.

While our current supply commitments from Lilly were adequate to provide product above our expectations for product demand, an essential element of our commercialization of Vancocin is also to establish a sufficient safety stock inventory as a precautionary measure,'' commented Michel de Rosen, ViroPharma's chief executive officer. We want to ensure that all patients with severe C. difficile disease who need this life saving product have access to it; this amendment with Lilly is important to us and our patients as it helps provide this insurance. In addition, we now anticipate that we will have two manufacturers for the product through the third quarter of next year which should help the transition to our third party supply chain.''

ViroPharma expects that this amendment will result in an additional increase of up to $4.5 million in inventory balances over the period of the fourth quarter of 2005 and the first quarter of 2006. The company anticipates that the product manufactured under this expanded agreement will ship to wholesalers during 2006. Future annual guidance for 2006 will reflect this activity.

C. difficile is a bacterium, which under certain circumstances, typically after antibiotic therapy, can colonize the lower gastrointestinal tract where it may produce toxins which cause inflammation of the colon and diarrhea, and the associated complications of disease. Advanced age, gastrointestinal surgery/manipulation, long length of stay in healthcare settings, a serious underlying illness and immunocompromising conditions are associated with increased risk of disease. According to the CDC, there are approximately 3,000,000 cases of antibiotic associated diarrhea per year, of which 15 to 25 percent are caused by C. difficile.