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

[la-onda]

seeking alpha again:
ViroPharma Incorporated: More FDA Incompetence
posted on: January 18, 2008 | about stocks: VPHM   


Hard on the heels of the corrupted approval process associated with Dendreon's (DNDN) Provenge comes evidence of still more incompetence at the Federal agency responsible for this nation's healthcare. This time it's the Office of Generic Drugs [OGD] that has proposed a new way of testing candidate generic versions of the only drug—brand Vancocin—that has shown to be effective in the treatment of Clostridium difficile-associated disease (CDAD, or C. difficile).

As noted by ViroPharma (VPHM), the manufacturer of Vancocin,
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. Without proper treatment, the associated complications of the disease can be deadly.

What OGD did in early 2006 that is of concern to many in the health community is to propose that henceforth, it would use an in vitro ("in glass") method to test proposed generic versions of brand Vancocin, in contradiction to its earlier policy of using human subjects ("in vivo"). Importantly, OGD adopted this new policy without issuing the requisite public notice or providing an opportunity for comment.

Further, what seems to have eluded OGD is the fact that to be effective, any generic version of brand Vancocin must demonstrate release in one specific section of the intestines, something in vitro testing can not establish.

What is interesting about this issue, and what casts serious doubts on the integrity of OGD, is that it was not the FDA that made the announcement of this important change in testing procedure. It was a Canadian investment firm called Infinium Capital Corp. ("Infinium"). On March 16, 2006, according to a filing by ViroPharma with the SEC, Infinium issued a report on ViroPharma entitled "Generics . . . sooner than you think". In their filing, ViroPharma noted that the report stated that "Our recent communications with the FDA regarding the approval process for a potential generic competitor to Vancocin lead us to believe a generic could enter the market 1-2 years sooner than current expectations."

This report was released two weeks after OGD's March 1, 2006, letter to Infinium! This was the first public disclosure of the new testing policy, and the impact on ViroPharma's share price was immediate and devastating: the release of Infinium's report triggered a multi-day sell-off of ViroPharma's stock that cut the company's market capitalization by 40%, or some $500,000,000.

To date, there has been no indication that the SEC, HHS, FDA Ethics, or the GAO even has investigated the matter regarding how information on the change in OGD policy was released to the public and on the stock market consequences therefrom.At no time was information related to the new proposed testing policy for candidate versions of brand Vancocin made available to ViroPharma.

Even more curious is the fact that ViroPharma has been unable to acquire the administrative record (including written correspondence and telephone records) of OGD's decision through a Freedom of Information Act (FOIA) request submitted in March, 2006.

According to ViroPharma, in their protest of the FDA's handling of this matter:

OGD treated similarly situated parties differently by selectively disclosing material information to, and thereby conferring a material informational advantage on, a very few potential market participants to the detriment of all others, including ViroPharma.

At this writing, OGD has issued no data or rationale they believe would support the new in vitro testing method. Nor has OGD shown any intent to disclose what they are proposing. If it had not been for the report issued by a Canadian stock analyst, the public still would be in the dark about OGD's misguided plan. More importantly, if in vitro testing for generic versions of brand Vancocin is not shown to be effective, the approval of ineffective versions of generic Vancocin would be a deadly serious mistake. Recent studies have shown that cases of CDAD are increasing world-world. Today, according to the US Department of Veterans Affairs, the disease causes 400,000 cases of diarrhea and colitis each year in the US.All of which begs the question: What was OGD thinking? Even more to the point: Were they thinking?

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VPHM: Short Interest DN 4.5% to 11.5M at the End of Jan 2008
Monday , February 11, 2008 16:23ET

According to new short interest data from NASDAQ, short interest for Viropharma, Incorporated (NasdaqNM: VPHM) DECREASED 4.5% to 11,517,625 shares as reported at month-end January, 2008. Based on VPHM's 20-day average daily share volume of 1,276,765, it would require approximately 10 day(s) of buying to cover this short interest.

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No Bonuses for Akorn Execs - Couldn't deliver    
On February 8, 2008, the Compensation Committee (the "Committee") of Akorn, Inc.
(the "Company"), resolved not to pay any cash bonuses to Mr. Arthur S. Przybyl, the
Company's President and Chief Executive Officer; Mr. Jeffrey A. Whitnell, the Company's
Chief Financial Officer; Dr. Abu S. Alam, the Company's Senior Vice President, New Business and
Product Development; Mr. John R. Sabat, the Company's Senior Vice President, National
Accounts; or Mr. Mark Silverberg, Senior Vice President, Global Quality Assurance (each of
the foregoing individuals, an "Executive Officer") pursuant to the management bonus objectives
for 2007, which were described in and filed with the Company's Current Report on Form 8-K
filed on April 23, 2007.

Will Akorn give up on generic vancomycin?
Akorn, Inc.  today announced that Arthur S. Przybyl,
president and chief executive officer, will be presenting at the Credit Suisse Specialty Pharmaceuticals "Up & Comers Day" Health Care Conference. The presentation is scheduled for 2:00 p.m. Eastern Time on Thursday, February 28, 2008 at the Credit Suisse office located New York City.

Chart:

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here is Zack's VPHM's screen print

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fyi:
Vincent J. Milano to Succeed Michel de Rosen as President and Chief Executive Officer of ViroPharma
Tuesday February 26, 4:30 pm ET
- Michel de Rosen to Continue as Chairman of the Board of Directors; Daniel B. Soland Promoted to Chief Operating Officer -

EXTON, Pa., Feb. 26 /PRNewswire-FirstCall/ -- ViroPharma Incorporated (Nasdaq: VPHM - News) announced today that, effective March 31, 2008, Vincent J. Milano will succeed Michel de Rosen as president and chief executive officer of the company and has been elected to its board of directors. Mr. de Rosen, who has led the company as president and chief executive officer since 2000, will continue as non-executive Chairman of the Board of Directors. Additionally, Daniel B. Soland will become chief operating officer, also effective March 31, 2008.

"Vinnie joined our company in 1996. We have worked together for eight years, so I know him very well; we have shared great successes and lived through significant challenges together," commented Michel de Rosen, ViroPharma's chief executive officer. "The attributes we want from a chief executive officer include a sense of strategic direction and vision, demonstrated integrity, and strong leadership skills. In our time together, Vinnie has demonstrated these characteristics time and time again at a very high level. I am convinced he will be a great chief executive officer and that, under his leadership, our company will go to the next level and then even higher. I obviously remain deeply committed to the future success of ViroPharma. I am returning to France to be closer to my family and become the chief executive officer of a private company. I will continue as Chairman of the Board of ViroPharma and will continue to work with Vinnie on matters of strategic importance to the company."

De Rosen continued, "I am also delighted to announce that Dan Soland has been promoted to chief operating officer from his previous post as chief commercial officer. Since joining the company in 2006, Dan has been at the helm of our commercial organization, and our ongoing strategic endeavors to prepare for the launch of Camvia(TM) (maribavir), grow Vancocin®, and expand into Europe. Dan's operational expertise in manufacturing, commercial, and global market development, his strong business acumen, and remarkable common sense make him the ideal person for the position of chief operating officer of our company."

"One of the fundamental values Vinnie and Dan share is their customer focus. They know that the reason we exist is to serve our customers, the patients and physicians," concluded de Rosen.

"I have enjoyed my first 12 years as a member of the ViroPharma team, and I look forward to leading ViroPharma through its next stages of success," commented Vincent Milano. "I firmly believe in the value of our pipeline products and Vancocin for patients. Michel has been a great leader for our company during his tenure as well as a great mentor and friend to me. The many successes we have had during the past eight years are a direct result of his leadership and passion. On behalf of the ViroPharma team, I want to thank Michel for his dedication, tireless work, creativity, and contribution to the ViroPharma culture."

Mr. Milano joined the company in 1996. Since 2006, he has served as vice president, chief financial officer and chief operating officer. Mr. Milano has been instrumental in building ViroPharma, including leading efforts in raising nearly $900 million in capital and the acquisitions of Camvia from GlaxoSmithKline, and Vancocin® from Eli Lilly and Company. He has played a critical role in all business development and investor relations activities of the company, and has contributed significantly to establishing the strategic direction of the company. Prior to joining ViroPharma, he was with KPMG LLP, independent certified public accountants. Mr. Milano received his bachelor of science degree in accounting from Rider College.

Mr. Soland joined ViroPharma in 2006 as vice president and chief commercial officer from his previous job as president of Chiron Vaccines. At Chiron, Mr. Soland was responsible for managing the vaccine division to annual sales of $1 billion. Prior to Chiron, he was the president and chief executive officer of Epigenesis Pharmaceuticals, a privately held biopharmaceutical company. He previously spent nine years with GlaxoSmithKline as the vice president and director of worldwide marketing operations, and five years as their vice president and director of the U.S. vaccines business unit. Mr. Soland holds a bachelor of science degree in pharmacy from the University of Iowa, in Iowa City, IA.

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ViroPharma Incorporated Reports Fourth Quarter and Full Year 2007 Financial Results

EXTON, Pa., Feb. 27 /PRNewswire-FirstCall/ -- ViroPharma Incorporated (Nasdaq: VPHM) reported today its financial results for the fourth quarter and twelve months ended December 31, 2007.

Key events since September 30, 2007 include:

    Development:
    -- European Orphan Drug Designation received for Camvia(TM) (maribavir);
    -- Patient enrollment continued in both phase 3 studies of Camvia in stem
       cell and solid organ transplant patients;
    -- Prelaunch activities for Camvia accelerated including new medical
       affairs and PR initiatives in preparation for the planned 2009 NDA and
       MAA filings;
    -- Monitoring and follow-up of patients who received HCV-796 in ongoing
       phase 2 study continued; evaluation of potential benefits versus risks
       to patients is ongoing to understand if and how further clinical
       studies are appropriate; and
    -- Work continued to optimize manufacturing and scale up for non-toxigenic
       C. difficile (NTCD) project in preparation for human clinical trials.

    Operational:
    -- Net sales of Vancocin(R) were $48 million;
    -- Launched new sales and marketing initiatives for Vancocin; and
    -- Research and development expenses increased by 305 percent over the
       fourth quarter of 2006, primarily driven by investments in Camvia, NTCD
       and increased personnel to support clinical momentum.

    Financial Results
    -- Operating income was $19 million;
    -- Increased working capital by $21 million to $594 million;
    -- Cash, cash equivalents and short-term investments grew by $32 million
       to $584 million; and
    -- 12th consecutive quarter of positive cash flow and profitability
       achieved.

Financial Highlights

Net sales of Vancocin(R) were $47.7 million for the fourth quarter of 2007 and $203.8 million for the twelve months of 2007 as compared to $38.5 million and $166.6 million in the respective 2006 periods.

Investment in our product pipeline and the Company continued to grow as research and development (R&D) and marketing, general and administrative (MG&A) expenses were $25.2 million and $72.9 million for the fourth quarter and twelve months of 2007, respectively compared to $10.2 million and $43.7 million for the fourth quarter and twelve months of 2006, respectively. These increases were due primarily to our two phase three studies for Camvia and increased personnel to support our clinical pipeline, along with increased marketing, general and administrative expense due to increases in medical education, share-based compensation and legal and consulting costs.

Operating income in the fourth quarter and twelve months ended December 31, 2007 was $19.0 million and $115.8 million, respectively, compared to $25.1 million and $98.8 million in the fourth quarter and twelve months of 2006, respectively. Operating income in the fourth quarter decreased primarily due to higher R&D and MG&A costs discussed above partially offset by the higher net sales. Operating income for the twelve months of 2007 increased due to higher net sales and lower cost of sales, partially offset by the increase in R&D and MG&A expenses.

"2007 represented a period of strong momentum for ViroPharma - clinical momentum, organizational momentum, and operational momentum - as we continue to be driven by our commitment to bring essential therapies to patients with few, if any, treatment options," commented Michel de Rosen, ViroPharma's chief executive officer. "Our 2007 clinical efforts were primarily driven by Camvia, which was granted Orphan Drug designation in both the U.S. and E.U. and gained global momentum through our pivotal phase 3 program as we head toward the anticipated filing of our initial NDA and MAA filings next year. As we enter 2008, we also have stronger teams in place to reach our development goals and generate future growth, both here in the U.S. and in the E.U. We will appropriately spend more in 2008 compared to 2007, which is, reflected in our expense guidance for 2008. This is consistent with our expectations and goal to ultimately deliver important, novel therapeutics to patients and physicians."

de Rosen continued, "Also, 2007 was another year of strong Vancocin performance; we achieved net product sales of $204 million, representing growth of 22 percent over that of 2006. We anticipate that our new marketing initiatives will help us garner additional growth in 2008 and beyond, potentially offsetting a slow down in the incidence rate of C. difficile infection (CDI). At ViroPharma, we take our commitment to the safety of patients with CDI very seriously. Through our efforts during the year, physicians were better educated to identify patients at high risk of disease, hospitals are better equipped to control CDI, and patients at risk of severe and complicated disease were assured of a proven safe and effective treatment. Importantly, though, our efforts in CDI are also focused on future treatment alternatives: we made progress toward a potential future treatment for disease recurrence, called NTCD, which we expect to enter the clinic this year."

Net income in the fourth quarter and twelve months ended December 31, 2007 was $20.4 million and $95.4 million, respectively, compared to net income of $18.0 million and $66.7 million for the same periods in 2006. Net income per share for the quarter ended December 31, 2007 was $0.29 per share, basic and $0.25 per share, diluted, compared to a net income of $0.26 per share, basic, and $0.25 per share, diluted, for the same period in 2006. Net income per share for the twelve months ended December 31, 2007 was $1.37 per share, basic, and $1.21 per share, diluted, compared to a net income of $0.97 per share, basic, and $0.95 per share, diluted, for the same period in 2006.

The primary drivers of the change in net income for the fourth quarter were the effects of decreased operating income discussed above, partially offset by increased interest income and a lower effective tax rate. Net income for the twelve month period increased primarily due to higher net sales and higher interest income, partially offset by increased operating expenses.

Operating Highlights

During the three and twelve months ended December 31, 2007, net sales of Vancocin increased 24.0 percent and 22.3 percent, respectively, compared to the same periods in 2006. The three and twelve month increases resulted from an increase of units sold, the impact of a price increase during 2007 and wholesaler inventory levels which were stable in 2007 compared to decreased levels in 2006.

The cost of sales for Vancocin for the three months ended December 31, 2007 remained consistent from the three months ended December 31, 2006 at $2.0 million. For the twelve months ended December 31, 2007, the cost of sales decreased $10.1 million to $8.9 million from $19.0 million in the same period in 2006. This decrease primarily results from the sale of units during the first half of 2007, which were manufactured by NPI Pharmaceuticals (formerly OSG Norwich) and carried a lower inventory cost than the units sold during the first half of 2006 that were manufactured by Eli Lilly & Co.

The total remaining costs and expenses associated with operating income were $26.6 million and $11.5 million, for the fourth quarter of 2007 and 2006, respectively, and $79.0 million and $49.4 million, for the twelve months of 2007 and 2006, respectively. These increases are primarily due to research and development costs, increased medical education and legal costs as well as an increase in stock compensation expense.

The Company's effective income tax rate was 18.0 percent and 39.9 percent for the quarters ended December 31, 2007 and 2006, respectively, and 29.7 percent and 38.6 percent for the twelve months ended December 31, 2007 and 2006, respectively. Income tax expense includes federal, state and foreign income tax at statutory rates and the effects of various permanent differences. The decrease in both the quarter and twelve months ended December 31, 2007 effect income tax rate as compared to the comparative periods in 2006 is primarily due to our current estimate of the impact of orphan drug credit for Camvia as well as a $4.0 million benefit for the valuation allowance reduction primarily related to additionally deferred tax assets that management believes are more likely than not to be utilized. Our income tax expense for the years ended December 31, 2007 and 2006 also includes the impact of finalizing the federal and state tax provisions for 2006 and 2005, respectively. We currently anticipate an effective tax rate in the range of approximately 27 percent to 31 percent for the year ended December 31, 2008, which includes an estimate related to orphan drug credit based upon estimates of qualified expenses and excludes the impact of discreet items and any potential changes in the valuation allowance. We continue to evaluate our qualified expenses and, to the extent that actual qualified expenses vary significantly from our estimates, our effective tax rate will be impacted.

Regarding additional payments due to Lilly in connection with the Vancocin acquisition, net sales as of December 31, 2007 exceeded the maximum milestone threshold of $65.0 million. As a result, the Company recorded additional purchase price of $6.0 million to intangible assets in June 2007, which was paid to Lilly in the third quarter.

Working Capital Highlights

As of December 31, 2007, ViroPharma's working capital was $594.4 million, which represents a $328.0 million increase from December 31, 2006, $21.1 million of which occurred in the fourth quarter of 2007. The twelve month increase is primarily the result of the net proceeds from an offering of senior convertible notes issued on March 26, 2007 and cash flows.

Looking ahead in 2008

ViroPharma is commenting upon previously announced guidance for the year 2008 as a convenience to investors. The following guidance provided by ViroPharma are projections, based upon numerous assumptions, all of which are subject to certain risks and uncertainties. For a discussion of the risks and uncertainties associated with these forward looking statements, please see the Disclosure Notice below.

For the year 2008, ViroPharma expects the following
-- Net product sales are expected to be $210 to $235 million;
-- Research and development (R&D) and sales, general and administrative (SG&A) expenses, excluding the impact of SFAS 123R, are expected to be $105 to $115 million.
-- The SFAS 123R impact to the above expenses will be in the range of $9 to $11 million.  Including the impact of SFAS 123R, the research and development (R&D) and sales, general and administrative (SG&A) expenses are expected to be $114 to $126 million.

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Great Price on ViroPharma Shares
Wednesday February 27, 4:34 pm ET
By Jason Napodano, CFA

ViroPharma, Inc.'s (NasdaqGS: VPHM - News) stock has been in a sideways trend for the past several months. And, although we are maintaining our Buy rating on the stock, we continue to see little movement until an update on a potential generic Vancocin product.

Management continues to petition the FDA to delay a generic entrant, most recently submitting views on the in-vitro dissolution bioequivalence testing methods. Approval of a generic product at Strides/Akorn at any time could create volatility in the stock.

At this level, ViroPharma stock is too attractive to ignore. Our 2008 revenue forecast of $221.5 million yields a price to sales ratio of 2.9x. This is significantly below the biotechnology peer group average of around 6.5x. We forecast 2008 EPS at $0.95 (including option expense). The price to earnings ratio of 9.9x is so far below the peer group, we can't help but wonder whether a company like GlaxoSmithKline (NYSE: GSK - News), Bristol-Myers (NYSE: BMY - News) or Wyeth (NYSE: WYE - News) would be interested in acquiring ViroPharma.

ViroPharma's stock sank in March 2006 on fears of generic Vancocin. Since that time, the company has continued to deliver solid results and progressed with Camvia to the point where we now include it in our long-term model. We think the candidate offers a significant growth opportunity over the long-term.

We think the market is too focused on the generic risk to Vancocin. We see the Citizen's Petition as solid, and the recently initiated exploratory study to characterize the GI track of healthy vs. infected patients will only help add to the scientific validity of management's claim. The two letters made public outlining the legal and scientific merits for a judgment stay are rather convincing in our view.

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interesting price action in a weak market !

VPHM: Jumps +4.20%; Vol +179%; Last 90 Min of Trading
Tuesday , March 04, 2008 16:22ET

During the last 90 minutes of today's session, shares of Viropharma, Incorporated (NasdaqNM: VPHM) demonstrated a strong UPWARD close relative to its 13:30 ET statistics. "Strong Closers" are determined by proprietary Knobias calculations performed during the last segment of each trading day.

sym: VPHM      @13:30 ET        @CLOSE      % CHANGE
----------   -----------   -----------  ------------
PRICE              $9.16         $9.55        +4.20%
VOLUME         1,018,479     2,838,894      +178.74%
#TRADES            5,404         9,799       +81.33%
DAY-HI             $9.42         $9.55       LATE-HI
DAY-LO             $9.06         $9.06           N/A

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VPHM: Short Interest DN 1.5% to 12.1M at the End of Feb 2008
Tuesday , March 11, 2008 16:28ET

According to new short interest data from NASDAQ, short interest for Viropharma, Incorporated (NasdaqNM: VPHM) DECREASED 1.5% to 12,134,138 shares as reported at month-end February, 2008. Based on VPHM's 20-day average daily share volume of 1,409,620, it would require approximately 9 day(s) of buying to cover this short interest.

&

AKORN update:

Just listened to cc. Art cannot guide Vanco approval date now.

Previous guidance was based on expedited review and no impact of Citizens Petition. He actually bad mouthed OGD's Gary Buehler for not getting the review done and being too slow. That should be worth another 12-month delay. It looks like they filed ANDA around April
2007 just as I expected and they estimated a 9-mo approval. Usual ANDA approvals are about 18-months but this one won't be decided any time soon. It is obvious he has no inside info from FDA as VPHM appears to be more in front of the issue, especially with their 2008 guidance.

&

From prepared remarks:

....We advanced our hospital business opportunities in 2007 in several
ways.

First and foremost and one of two main revenue opportunities for our
hospital segment in 2008 is our relentless pursuit of a safe,
effective and affordable generic oral vancomycin product.

In 2007 a major milestone in our joint development and marketing
partnership with Cipla for vancomycin was the filing of the ANDA
early in the second quarter of 2007.

Our ANDA is not yet a year old.

In addition, we were granted an expedited review for this ANDA . And
our ANDA clearly demonstrates equivalencyto the referece listed
drug.based on published FDA guidance and our C?C and stability
results.

Based on these facts I guided to a year end ANDA approval for
Vancomycin.

Unfortunately, and to the detriment of the US healthcare consumer, I
was wrong.

The market opportunity for a safe effective generic version of oral
vancomycin remains robust. The monopoly continues to exist where no
patent does. And the market opportunity continues to grow, now at
$225-mil. Primarily generated from price increases.

We remain resolute in our pursuit of a safe and effective and
affordable generic version of oral vancomycin and expect our generic
approval to contribute to our revenue base in 2008.......


From Q and A:

"Scott Hirsch(CSFB): Hi there guys, a few questions. With repect
to Vanco, I just wanted to follow up on the manufacturing. Has Cipla
fully manufactured this, have you guys brought it into the country at
all or is it still not here?

Art: Cipla has validated the manufacturing process for the drug.
The product will be shipped to the United States shortly, under
quarantine conditions....."



Jason ? from Jarda? Equities: Good Afternoon. Guys, I was hoping
you could provide up with a little more clarity around generic
vancocin. Can you give us some idea what the OGD is telling you as
to why we didn't get the approval last year and what makes you think
that we will get it this year? I mean are we hearing from them that
we are going to get it and, if so, what changed from last year to
this year.

Art: Without going into a lot of detail, my persepective is that
the citizen's petition is holding up the ANDA approval. The
citizen's petition was vetted in March of 2005 and quite frankly I
think Gary Buehler and the folks over at FDA need to get a move on.


Jason: Now when you guided last year I know that you got fast track
on the ANDA. Was it solely that that led you to give guidance that
you would get approval last year or is it discussions? We are just
trying to figure out how certain that this will come out this year.

Art: Long silence. Well I can't answer in regards to pinning down
an approval time with certainty as you can probably guess. I think
you understand why I guided where I did from my opening remarks. It
was based on the expedited review and the fact that based on the
dating when we submitted our ANDA. Typically and ANDA takes 18-
months. I felt that the citizens petition was placed in March
of '05 and, to be quite blunt, I felt the FDA should have completed
their work by the end of the year. No question about it. And,
unfortunately, that was not the case.

Jason: So it was not really that you had been mislead by the OGD.
It is really based more on your own assumptions.

Art: It was clearly based on my own assumption and that is why I
said I was wrong, and I think that, you know I've guided in FDA
events in the past. I guided to compliancy back in '05 I believe.
And in December I guided ........."


THIS is very positive for VPHM
[/b]
chart:

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VPHM: JMP Sec Starts @ Mkt Outperform; Sets Tgt @ $12; Analyst Notes
Friday , March 14, 2008 07:35ET

Issuer: Viropharma, Incorporated (NasdaqNM: VPHM)

Analyst Firm:  JMP Securities

Ratings Action: INITIATE

Current Rating: Mkt Outperform

Target Price Action: INITIATE
Target Price: $12.00

Analyst Comments: The firm believes VPHM's valuation reflects several negative scenarios and notes that earnings will likely remain positive and that the company has a strong balance sheet.

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GS update:

Feb 28, 2008 ViroPharma Inc. (VPHM): Q42007 beat on expenses, but building value step by step

WHAT'S CHANGED: ViroPharma reported Q42007 Vancocin sales of $47.7 million
and EPS of $0.25, vs. our estimates of Vancocin sales of $50.9 million and EPS of
$0.18. ViroPharma beat the quarter on slightly lower operating expenses, higher
interest income and a lower tax rate than we had forecast. The consensus revenue and
EPS estimates were $50.4 million and $0.20. The company reiterated 2008 guidance,
with expected Vancocin sales of between $210-$235 million, R&D and SGA expenses
of $105-$115 million (ex ESO) and SFAS 123R impact of $9-$11 million. The
company announced yesterday that effective 3-31-08, Vincent Milano, the current CFO
and COO, will succeed Michel de Rosen as President and Chief Executive Officer.
IMPLICATIONS: Based on Q4 trends and our 2008 outlook, we have adjusted our
2008 and 2009 EPS estimates to $0.85 and $0.35 from $0.50 and $0.20 respectively.
While our model had previously assumed generic entry in 2008, we now assume this
occurs in 2009. We also introduce 2010 EPS estimate of $0.25. We expect 2010 to be a
transition year, with potential introduction of Camvia.

VALUATION: We maintain our 12-month target of $17, based on an NPV assessment
of Vancocin sales (assuming 2009 generic entry, which could be conservative) and the
pipeline. ViroPharma shares may remain somewhat range-bound until concerns about
potential generic entry are resolved (timing not predictable) and/or until we get closer
to potential Camvia data (2009 timeframe by our estimates). We believe that there is
longer term stock upside from pipeline progress and/or from generic Vancocin delays,
but short term downside if generics are approved in 2008.

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VPHM: Short Interest UP 11.5% to 13.5M in Mid Mar 2008
Wednesday, March 26, 2008 16:26ET

According to new short interest data from NASDAQ, short interest for Viropharma, Incorporated (NasdaqNM: VPHM) INCREASED 11.5% to 13,533,920 shares as reported in mid-March, 2008.

Based on VPHM's 20-day average daily share volume of 1,710,265, it would require approximately 8 day(s) of buying to cover this short interest.

still holding...

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Cowen presentation 18th of March 2008 part 1

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Cowen presentation 18th of March 2008 part 2

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Cowen presentation 18th of March 2008 final part

still invested 

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Viropharma's Camvia may change current treatment paradigm in stem cell transplant market
By Kimberly Ha in New York

Published: April 2 2008 16:53 | Last updated: April 2 2008 16:53


This article is provided to FT.com readers by Pharmawire—a news service focused on providing insight into the most price sensitive issues in the global pharmaceutical market. www.pharmawire.com
--------------------------------------------------------------------------------------------------------


ViroPharma's Phase III drug Camvia (maribavir) for the prevention of cytomegalovirus (CMV) disease may change the current treatment paradigm in the stem cell transplant market from preemptive therapy to prophylaxis, physicians told Pharmawire.

CMV is a significant cause of morbidity and mortality in transplantation patients. Both prophylaxis and preemptive therapy are used to prevent the development of CMV infection after transplantation.

Controversy exists over which method, prophylactic or preemptive therapy, is the optimal strategy to adopt for the prevention of CMV disease. With the prophylaxis approach, antivirals are administered to all patients for a period of usually three months after transplantation. The preemptive approach exposes the least number of patients to the toxic effects of antiviral agents, which is also costly, but requires more frequent patient monitoring.

Although current literature suggests the prophylactic method is more advantageous, many physicians have been hesitant to adopt this therapy due to the toxicity profile of currently approved drugs. As Viropharma's Camvia shows no myelosuppression and less toxicity
compared with current ganciclovir-based treatments, it may effectively increase the current market size for CMV drugs since more patients can receive preventative, or prophylactic treatment due to the better risk-benefit ratio.

Dr Stephen Berger, Director of Geographic Medicine and of Clinical Microbiology at Tel Aviv Medical Center, said the current standard of care, oral ganciclovir is quite toxic, and has 41 toxicities and 14 drug to drug interactions. In addition to myelosuppression, other
side-effects include hair-loss and anemia.

The therapeutic effectiveness of current drugs on the market such as Roche's Valcyte (an oral version of ganciclovir) and ganciclovir itself are also compromised by the emergence of drug-resistance. Camvia is also effective against ganciclovir-resistant strains of
CMV.  Dr Drew Winston, an investigator at UCLA Medical Center, said Camvia can reduce the incidence of CMV infection and, unlike the current drug ganciclovir, it does not cause myelosuppression. "The reason why ganciclovir in prophylaxis hasn't been used in stem cell treatment is because of the drug's effect on myelosuppression. However, preemptive
therapy with ganciclovir was effective.

"Camvia will represent major advancement to preventing CMV in stem cell transplant patients, if Phase III trials confirm efficacy," said Winston.

Dr Colin Broom, Vice President and Chief Scientific Officer at Viropharma, said with the current market size it is estimated to be USD 500m-600m, but under the current treatment paradigm - only patients who are at very high risk for CMV receive prophylactic treatment, due to the toxicity profile of currently marketed drugs.

"Hopefully, the current treatment paradigm will change from one where you use as little treatment as possible, to one where you will prophylax all patients," said Broom. Out of the 100,000 annual transplants, less than 20% of the current patient population gets prophylaxis treatment, he estimated. Every patient could potentially receive Camvia for three months in terms of preventative treatment. Viropharma is looking to change the treatment paradigm, to get physicians to use Camvia in first-line prophylaxis therapy. Although Valcyte is a good drug, there are always worries about toxicities, Broom added.

Dr Don Diamond, director of the Laboratory of Vaccine Research at City of Hope National Medical Center in California, said Camvia might have some positive effect, but the problem is you have an immature immune response in transplant patients.

Although oral ganciclovir is not as effective as the IV form, it does not make sense to replicate the problems with IV administration due to the central venous catheter. "As an oral drug, you can also give it in the outpatient setting," said Diamond.

However, Diamond believed that Camvia has the same problems as ganciclovir, as it also involves a chemotherapy approach at disabling the virus replication via immune response suppression. "You have to stop giving these drugs because otherwise people get resistance. But once you stop, the CMV becomes active again," said Diamond. Patients may face the problem of late CMV infection after discontinuing prophylaxis treatment.

Another criticism of Viropharma's trial is there is no data comparing Camvia against the current standard of care, which is Roche's Valcyte (valganciclovir).

ViroPharma also chose to compare Camvia against oral ganciclovir - not the more effective IV ganciclovir formulation. When asked whether oral drugs show less efficacy than IV formulations, Winston countered that the bio-availability of oral Camvia is much better than oral ganciclovir. Camvia may also be available in IV form in the future, he added.

The Phase III stem-cell transplant trial has recruited over 300 patients. A total of over 600 patients are needed for the stem-cell transplant study, said Winston. Enrollment for this trial is expected to be completed by mid-year.

"All the patients in this study have to be followed for 6 months, so final data will be available sometime in early 2009," said Winston. The liver transplant study is enrolling at a slower rate, since enrollment started later.  In the liver transplant study, about 100 out of 300 patients have been enrolled. This study compares Camvia with oral ganciclovir, and when asked why Viropharma did not choose to test Camvia with Valcyte, Winston said at that time, Valcyte was not approved for use in liver transplant patients. "To satisfy FDA requirements, we had to compare Camvia to an approved drug," he said. The preliminary results clearly show that Camvia can be safe and effective for preventing CMV infection in stem cell transplant patients. "There has not been significant improvement in the ability to prevent CMV infection in stem cell transplants in the last 10 years," said Winston. Without any type of prophylaxis, more than 50% of stem cell transplant patients are infected with CMV. The drug inhibits viral encapsulation and prevents the virus from exiting the nucleus, which is a novel mechanism of action compared with currently approved drugs, which include Roche's ganciclovir and Valcyte.

Viropharma has a current market cap of USD 632m.