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

[AussieTrader]

Indeed Basanlas the timing of yesterdays high being so close to our target (but not quite getting there) and then the news on the LEV takeover (which the initial market reaction to is one of negativity) can be summed up in one word....SH1T
However that is the inherent risk with trading, soon there will be one that does go in your favour.

Stopped out of VPHM $10.40

[la-onda]

well I have bought back VPHM @ 10.35 

why?
please check:

[la-onda]

ViroPharma's Growing Pains
07.15.08, 5:50 PM ET

ViroPharma dropped after investors became unfamiliar with where they put their money.

Shares of the Exton, Penn.-based biotech firm sunk 13.2%, or $1.67, to $10.87, after it announced it was buying Lev Pharmaceuticals for $442.9 million, or $2.75 per share. The offer marks a 48.6% premium above Lev's closing price of $1.85 Monday.

There's also a contingent consideration of up to $1.00 per share that would be paid if Lev's drug candidate Cinryze meets certain milestones, making the deal potentially worth $617.5 million. Cinryze treats HAE, which causes severe swelling, and can be fatal if it causes swelling in the larynx.

Patients who suffer acute attacks may be treated with breathing tubes and tracheostomy, a procedure in which surgeons cut into the windpipe to allow a patient to breathe. The illness is most often treated with anabolic steroids in the U.S., but ViroPharma said patients and allergists would prefer a new option.

ViroPharma 's only marketed drug is Vancocin, which treats gastrointestinal tract infections.

The deal sent Lev's stock soaring 30.3%, or 56 cents, to $2.41, in late-afternoon trading. Aside from a small swoon earlier this year, the stock has been effectively flat since the beginning of 2007. Lev is a biopharmaceutical company that focuses on developing treatments for inflammatory diseases

So why are ViroPharma's shareholders so unhappy? Because they saw the deal as a good time to sell. According to Jason Napodano, an analyst at Zacks Investment, Lev is a small and little known company. Concurrently, one of the main supports for ViroPharma's stock was its huge cash balance, which the company is putting most of into Lev.

Coupled with that is ViroPharma's recent rise. Since the beginning of the year ViroPharma's has gained 41.2%, which is especially remarkable since the S&P 500 has lost 16.4% over the same period.

"The strategy for ViroPharma has changed, there're new risks," Napodano said. "It's a knee jerk reaction, but that's what happens." That doesn't mean Napodano believes ViroPharma isn't worth the money. The analyst still has a "buy" rating on the stock.

&

VPHM: Management Discusses Acquisition of Lev Pharmaceuticals
Tuesday , July 15, 2008 13:49ET



Viropharma, Inc. (VPHM) and Lev Pharmaceuticals, Inc. (LEVP) have signed a definitive merger agreement under which ViroPharma will acquire Lev for $442.9 million of upfront consideration, or $2.75 per Lev share, comprised of $2.25 per share in cash and $0.50 per share in ViroPharma common stock (subject to a collar). Contingent consideration of up to $1.00 per share may be paid on achievement of certain regulatory and commercial milestones. The transaction has a potential net aggregate value of up to $617.5 million. In addition, concurrently with the execution of the merger agreement, ViroPharma purchased $20 million of Lev common stock.

The acquisition of Lev Pharmaceuticals further enhances ViroPharma's pipeline with Cinryze(TM) (C1 inhibitor (human)), which is currently under regulatory review for approval by the U.S. Food and Drug Administration as a replacement therapy for patients with hereditary angioedema (HAE), also known as C1 esterase inhibitor (C1-INH) deficiency.

HAE is the result of a defect in the gene controlling the synthesis of C1 inhibitor. C1 inhibitor maintains the natural regulation of the contact, complement, and fibrinolytic systems, that when left unrestricted, can initiate or perpetuate an attack by consuming the already low levels of endogenous C1 inhibitor in HAE patients. Patients with C1 inhibitor deficiency experience recurrent, unpredictable, debilitating, and potentially life threatening attacks of inflammation affecting the larynx, abdomen, face, extremities and urogenital tract. While there is no approved therapy for acute HAE attacks in the U.S., a commercially available C1 inhibitor has been used in Europe to treat HAE for more than 35 years. There are estimated to be 10,000 people with HAE in the U.S.

Vincent Milano, ViroPharma's president and CEO, explained in a conference call today, "Lev represents an ideal strategic fit for us. They have a late stage, clinically proven product with additional indication opportunities. Cinryze provides a strong exclusivity proposition and U.S. Orphan Drug designation. It is the only drug in development with pivitol data in HAE prophylaxis. We also believe that there is a good probability of near term approval in prophylaxis in Q4 of 2008. This drug has a high probability of regulatory and commercial success."

He added, "We believe Cinryze to be at least a $250 million to $350 million a year product at peak with margins of between 65% and 70%."

Dr. Colin Broom, Chief Scientific Officer of ViroPharma, commented, "I am convinced that Cinryze is an important drug that will save many lives. We are confident that Lev has adequately addressed all issues raised by the FDA's recent approvable letter."

The COO of ViroPharma, Daniel B. Soland, discussed the commercial strategy, "The FDA has indicated that they are considering HAE prophylaxis and acute treatment separately for exclusivity. This is very important because, even though several HAE drugs are in development, Cinryze is the only drug in development with pivotal prophylactic data."

"Despite a 50/50 chance that an HAE patient will pass it on to their child, only 34% of family members have been tested for HAE. HAE treeating allergists average 6.5 HAE patients per practice. 64% to 75% currently use prevention with steriods despite limitations and long term health concerns. 59% of responding allergists rate current satisfaction as 3 or below on a scale of 7," added Mr. Soland.

Mr. Milano concluded, "Strong work in advance of approval by the Lev team will help support a successful launch. Viropharma's commercial and regulatory experience, infrastructure and capital improve the likelihood of success. Cinryze is a niche market opportunity that is addressable with modest infrastructure. The intergration is very doable and both companies will be engaged."

please download attached presentation!

[la-onda]

Ahead of the Bell: ViroPharma upgraded   
Wednesday July 16, 8:29 am ET
Analyst upgrades ViroPharma after Lev buyout, saying Cinryze will fill revenue gap

NEW YORK (AP) -- A Thomas Weisel analyst upgraded shares of ViroPharma Inc. Wednesday, saying the company has gained a key drug candidate in its buyout of Lev Pharmaceuticals.

ViroPharma agreed to buy Lev on Tuesday for $442.9 million in cash and stock, giving ViroPharma access to Lev's drug candidate Cinryze. Analyst Stephen Willey believes the drug will be approved in October, and said Cinryze will help ViroPharma replace revenue from its drug Vancocin, which could face generic competition next year. If Cinryze is approved by the Food and Drug Administration and granted market exclusivity, the price of the deal could rise to $617.5 million. The drug is designed to treat hereditary angioedema, a rare genetic disease that causes pain and swelling of the face and extremities. HAE can be deadly if it leads to blockage of a patient's airways. Other drug makers developing treatments including Dyax Corp. and Shire Ltd.

Vancocin treats gastrointestinal infections, and it is ViroPharma's only marketed product.

Willey raised his rating to "Overweight" from "Market weight," and lifted his price target to $15 per share from $10. He thinks Vancocin sales may start declining in 2009, but expects Cinryze to be approved early next year -- helping the company operate until its drug Camvia reaches the market in late 2010 or early 2011.

In a Tuesday conference call, ViroPharma said it expects peak annual sales of Cinryze to reach $250 million to $300 million.

"Competition in HAE drug development is fierce, with five late-stage clinical candidates all vying for approval in both the U.S. and Europe," Willey said. But he thinks Cinryze has an advantage because clinical data supports its use as a prophylactic, or preventive, treatment. He said that means the drug is likely to receive orphan drug status, blocking competitors from the market.

Camvia is designed to treat cytomegalovirus in stem cell and liver transplant patients. Willey said ViroPharma's estimate of $400 million to $500 million in peak sales for Camvia is "highly conservative."

[la-onda]

ViroPharma rises, then pares gains after Lev deal
Wednesday July 16, 7:16 pm ET

ViroPharma shares rise, then pare gains after Lev Pharma buyout; analyst upgrades rating

NEW YORK (AP) -- ViroPharma Inc. shares wavered Wednesday as Wall Street took a second look at the company's buyout of Lev Pharmaceuticals and Lev's drug candidate Cinryze.

ViroPharma agreed to buy Lev on Tuesday for $442.9 million in cash and stock. If the Food and Drug Administration approves Cinryze and grants it exclusivity as a treatment for acute hereditary angioedema, the price could rise to $617.5 million. ViroPharma stock dropped 15.3 percent Tuesday, and in Wednesday afternoon trading, it picked up 26 cents to close at $10.88. Earlier in the session, the shares advanced as much as 6 percent.

In a telephone interview, Cowen and Co. analyst Rachel McMinn said the stock dropped because ViroPharma's investors hadn't heard of Lev or Cinryze before. She said that from their perspective, ViroPharma burned off a big portion of its "cash cushion" on a deal that looks risky.

HAE is a rare genetic disease that causes pain and swelling of the face and extremities. It can be deadly if it leads to blockage of a patient's airways. ViroPharma estimates that about 10,000 people have the disease in the U.S., although only about 4,600 have been diagnosed.

Cinryze is being tested as a treatment for acute HAE attacks, and as a preventive treatment to stop the attacks from occurring. The FDA is considering those two applications separately. While Cinryze could be approved in October as a preventive treatment, another drug -- CSL Behring's Berinert -- could be approved in September for acute cases.

Both drugs have received orphan drug status, which would prevent any rival drugs from being approved for the same application for up to seven years. McMinn said the drugs are "identical," and if both are approved, they could split the already-small market in HAE.

"Physicians might just substitute one for the other," she said. "If prices are same it becomes a question of who they like better from a sales perspective."

Other drug makers developing treatments include Dyax Corp. and Shire Ltd. Both Cinryze and Berinert replace a protein called C1 esterase inhibitor. The protein stops the inflammation reaction, and because HAE patients do not have enough of it, their inflammation reaction can spiral out of control.

Thomas Weisel analyst Stephen Willey believes the drug will be approved in October, and said Cinryze will help ViroPharma replace revenue from its gastrointestinal infection drug Vancocin, which could face generic competition next year.

Willey raised his rating to "Overweight" from "Market weight," and lifted his price target to $15 per share from $10. He thinks Vancocin sales may start declining in 2009, but expects Cinryze to be approved early next year -- helping the company operate until its drug Camvia reaches the market in late 2010 or early 2011.

In a Tuesday conference call, ViroPharma said it expects peak annual sales of Cinryze to reach $250 million to $300 million.

"Competition in HAE drug development is fierce, with five late-stage clinical candidates all vying for approval in both the U.S. and Europe," Willey said. But he thinks Cinryze has an advantage because clinical data supports its use as a prophylactic, or preventive, treatment. He said that means the drug is likely to receive orphan drug status.

Camvia is designed to treat cytomegalovirus in stem cell and liver transplant patients. Willey said ViroPharma's estimate of $400 million to $500 million in peak sales for Camvia is "highly conservative."

[la-onda]

please check and download attached CC transcript and chart update 

[la-onda]

VPHM: Stanford Group Cuts to Hold from Buy; Sets Tgt @ $11; Analyst Notes
Friday , July 18, 2008 09:45ET
Issuer: Viropharma, Incorporated (NasdaqNM: VPHM)
Analyst Firm:  Stanford Group
Ratings Action: DOWNGRADE
Current Rating: Hold (from Buy)
Target Price: $11.00
Analyst Comments: The firm downgraded the stock after a highly knowledgeable, unbiased consultant told them that drug companies would not have to conduct clinical tests before obtaining approval for a generic version of ViroPharma's Vancocin. As a result, Stanford forecasts a major decline in Vancocin sales starting next year.

[la-onda]

  back we are...

[la-onda]

awesome news:

ViroPharma:
Panel meeting provides little insight into FDA's thinking on generic Vancocin - Rodman & Renshaw (10.04 )

Rodman & Renshaw notes the FDA held an advisory committee meeting for Pharmaceutical Science and Clinical Pharmacology. Although no specific drug was considered by the panel, the topic of discussion was relevant to the ongoing issue of the potential ANDA approval of a generic Vancocin based solely on in vitro bioequivalence data. As expected, little was learned today that gives firm any further insight as to when a generic Vancocin will be approved. It was clear from the meeting that the FDA is determined to find an appropriate way to approve generic versions of drugs that act locally in the GI tract. Firm has further confidence that a generic Vancocin will not be approved in the near term. They currently assume that no generic Vancocin will be approved in 2008 and today's advisory committee meeting has given them no reasons to alter this assumption.

VPHM: Short Interest UP 1.2% to 12.1M in Mid Jul 2008
Thursday , July 24, 2008 16:23ET

According to new short interest data from NASDAQ, short interest for Viropharma, Incorporated (NasdaqNM: VPHM) INCREASED 1.2% to 12,149,732 shares as reported in mid-July, 2008.
Based on VPHM's 20-day average daily share volume of 1,926,460, it would require approximately 7 day(s) of buying to cover this short interest.

Chart:

[la-onda]

Earnings estimation and chart update:

[la-onda]

 
ViroPharma Incorporated Reports Second Quarter 2008 Financial Results
Wednesday July 30, 7:46 am ET
- Company Achieves Record Vancocin(R) Net Sales; Increases Full Year Guidance for 2008 -

EXTON, Pa., July 30 /PRNewswire-FirstCall/ -- ViroPharma Incorporated (Nasdaq: VPHM - News) reported today its financial results for the second quarter and six-months ended June 30, 2008.

Key events since March 31, 2008 include:

Development:

-- Completed enrollment in Phase 3 study of maribavir in stem cell transplant (SCT) patients;

-- Announced intent to present top-line maribavir Phase 3 SCT data in the first quarter of 2009;

-- Announced intent to file the initial New Drug Application (NDA) in the U.S., Marketing Authorization Application (MAA) in Europe, and New Drug Submission (NDS) in Canada for maribavir in SCT patients in the third quarter of 2009;

-- Complete clinical trial results from maribavir Phase 2 study in stem cell transplant patients were published in the June 1 issue of the scientific journal Blood; and

-- Patient enrollment continued in Phase 3 study of maribavir in solid organ (liver) transplant patients.

Operational:

-- Net sales of Vancocin achieved a record $65 million;

-- Research and development expenses increased by 106 percent over the second quarter of 2007, primarily driven by investments in maribavir and NTCD; and

-- Selling, general and administrative expenses increased 94 percent over the second quarter of 2007 due to increased investments in our European operations, our Vancocin sales force, additional medical education activities and increased marketing efforts.

Business Development:

-- Signed a definitive merger agreement under which ViroPharma will acquire Lev Pharmaceuticals, Inc. (OTC Bulletin Board: LEVP - News) for $442.9 million of upfront consideration, or $2.75 per Lev share, comprised of $2.25 per share in cash and $0.50 per share in ViroPharma common stock (subject to collar);

-- Contingent consideration of up to $1.00 per share may be paid on achievement of certain regulatory and commercial milestones; and

    -- Transaction is expected to be completed by the end of 2008.


Financial Results:
    -- Operating income was $30 million;
    -- Increased working capital by $25 million to $644 million;

-- Cash, cash equivalents and short-term investments grew by $34 million to $633 million; and

-- 14th consecutive quarter of positive cash flow and profitability achieved.

Net sales of Vancocin were $65.4 million for the second quarter of 2008 and $116.4 million for the first six months of 2008, as compared to $56.1 million and $105.1 million in the respective 2007 periods.

Operating income in the second quarter and six-months ended June 30, 2008 was $29.7 million and $49.2 million, respectively, compared to $35.9 million and $68.8 million in the second quarter and six months of 2007, respectively. Operating income decreased primarily due to higher R&D and SG&A costs partially offset by higher net sales.

"The second quarter of 2008 was a period of considerable achievement throughout the company," commented Vincent Milano, ViroPharma's president and chief executive officer. "The growing momentum surrounding maribavir was evident as we completed enrollment of our phase 3 study in stem cell transplant patients, solidified our global regulatory filing strategy and continued to finalize our pre-launch, approval and launch plans. We also continue to make noteworthy progress enrolling patients in the solid organ transplant study. In addition, we saw remarkable performance of Vancocin, generating record quarterly revenue during the second quarter and allowing us to increase our 2008 net sales guidance to between $220 and $240 million. Our sales force, which launched earlier in the year, is making good progress in accessing the physician community and we anticipate that the progress will continue throughout the year."

Continued Milano, "We believe that the second half of 2008 will be marked by additional momentum throughout the business as we continue to execute on the maribavir studies and progress towards our planned initial NDA, MAA, and NDS filings in the third quarter of 2009. Regarding our C. difficile franchise, we look forward to the publication of the final IDSA/SHEA treatment guidelines later this year for the management of C. difficile infection as these guidelines represent an important step in ensuring that the most severely affected patients are receiving Vancocin, the appropriate therapy for these patients."

Net income in the second quarter and six-months ended June 30, 2008 was $24.1 million and $41.5 million, respectively, compared to a net income of $31.6 million and $53.7 million for the same periods in 2007. Net income per share for the quarter ended June 30, 2008 was $0.34 per share, basic and $0.30 per share, diluted, compared to a net income of $0.45 per share, basic, and $0.39 per share, diluted, for the same period in 2007. Net income per share for the six-months ended June 30, 2008 was $0.59 per share, basic, and $0.51 per share, diluted, compared to a net income of $0.77 per share, basic, and $0.70 per share, diluted, for the same period in 2007.

The primary drivers of the decrease in net income were the effects of lower operating income discussed above, partially offset by a lower effective tax rate.

Operating Highlights

During the three and six months ended June 30, 2008, net sales of Vancocin increased 16.6 percent and 10.7 percent, respectively, compared to the same periods in 2007 primarily due to an increase in the number of units sold to wholesalers and the impact of a price increase during 2008.

The cost of sales for Vancocin for the three and six months ended June 30, 2008 decreased $0.2 million and $0.6 million, respectively, as compared to the same periods in 2007. For the three and six month periods ended June 30, 2008 the cost of sales was $2.4 million and $4.3 million, respectively, compared to $2.6 million and $4.9, respectively, for the same period in 2007.

Investment in our product pipeline and the Company continued to grow as research and development (R&D) and selling, general and administrative (SG&A) expenses in the second quarter and six-months ended June 30, 2008 were $31.2 million and $59.0 million, respectively compared to $15.6 million and $28.1 million for the second quarter and six-months of 2007, respectively. These increases were due primarily to the increased costs, including the costs of increased personnel, associated with our phase 3 program for maribavir, along with increased selling, general and administrative expense due to compensations costs, including share-based compensation, which resulted from increased headcount for our European operations and our Vancocin sales force, as well as medical education activities and marketing efforts.

The Company's effective income tax rate was 25.6 percent and 22.7 percent for the quarters ended June 30, 2008 and 2007, respectively, and 26.8 percent and 30.6 percent for the six months ended June 30, 2008 and 2007, respectively. Income tax expense includes federal, state and foreign income tax at statutory rates and the effects of various permanent differences. The variances in the effective rate for the quarter and six-months ended June 30, 2008 as compared to the comparative periods in 2007 is primarily due to our current estimate of the impact of orphan drug credit for maribavir. We currently anticipate an effective tax rate in the range of approximately 25 percent to 30 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 June 30, 2008 exceeded the milestone threshold of $45.0 million. As a result, the Company recorded additional purchase price of $7.0 million to intangible assets in 2008. No purchase price consideration will be due to Lilly relating to net sales occurring in the remainder of 2008.

Working Capital Highlights

As of June 30, 2008, ViroPharma's working capital was approximately $644.0 million, which represents a $49.6 million increase from December 31, 2007, $24.5 million of which occurred in the second quarter of 2008. The six month increase is primarily the result of cash flows provided by sales of Vancocin.

Business Development Highlights

As more fully detailed in a Current Report on Form 8-K filed with the Securities and Exchange Commission, on July 15, 2008, we announced that we signed a definitive merger agreement with Lev Pharmaceuticals, Inc. (Lev), pursuant to which we will acquire Lev. The merger agreement provides for HAE Acquisition Corp., our wholly owned merger subsidiary, to merge with and into Lev with Lev continuing as the surviving company. The terms of the merger agreement provide for the conversion of each share of Lev common stock into upfront consideration of $2.75 per Lev share, comprised of $2.25 per share in cash and $0.50 per share in our common stock (subject to collars), and contingent consideration of up to $1.00 per share which may be paid upon achievement of certain regulatory and commercial milestones.

The merger agreement contains certain termination rights for us and Lev, as the case may be, applicable upon the occurrence of certain events specified in the merger agreement. The merger agreement provides that, in the event of the termination of the merger agreement under specified circumstances, Lev may be required to pay us a termination fee.

The merger agreement provides for both ViroPharma and Lev to conduct our respective businesses in the ordinary course until the merger is completed and not to take certain actions during the period from the date of the merger agreement until the date of completion of the merger.

The transaction with a potential net aggregate value of up to approximately $617.5 million has been unanimously approved by the boards of directors of both companies. We expect the transaction to be completed by the end of 2008. In addition, concurrently with the execution of the merger agreement, we made a $20 million investment in Lev common stock to provide Lev with short and medium term financing in connection with the commercialization of its product candidate Cinryze(TM).

Looking ahead in 2008

ViroPharma is commenting upon 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. The guidance below excludes the acquisition and operations of Lev Pharmaceuticals.

For the year 2008, ViroPharma expects the following

-- Net product sales are expected to be $220 to $240 million;

-- Research and development (R&D) and selling, general and administrative (SG&A) expenses, excluding the impact of SFAS 123R, are expected to be $110 to $120 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 between $119 and $131 million.

[la-onda]

ViroPharma Cheap and Promising
Friday August 1, 12:06 pm ET
By Jason Napodano, CFA

ViroPharma, Inc. (NasdaqGS: VPHM - News) made a bold move earlier in July to acquire Lev Pharmaceuticals and with it, Cinryze, a potential $250 million product for hereditary angioedema (HAE).  HAE is an ultra-rare genetic disorder and a highly attractive market given the significant unmet medical need.

Thus, we are positive on the deal, but acknowledge that significant questions remain. Nevertheless, the move works to greatly diversify the product portfolio and ease investor concern that a generic Vancocin would be devastating to the financial results.

On the contrary, we think both Cinryze (under regulatory review) and antiviral maribavir (in phase III) could be on the market by 2010 and generating positive income. Couple this with an estimated $300 million in cash still to be on hand after the Lev deal closes, and still at least another year of exclusive Vancocin sales, and the company's fundamental position is rock solid. We are maintaining our Buy rating.

At this level ViroPharma stock is too attractive to ignore. Second quarter results handily beat our expectations.  Our 2008 revenue forecast of $233.3 million yields a price to sales ratio of only 3.5x. This is significantly below the biotechnology peer-group average of around 6.5x. We forecast 2008 EPS at $0.90. The price to earnings ratio is only 13.1x.

Our model will likely undergo significant revisions once the Lev deal closes in the fourth quarter, but as of now we see $1.32 per share in EPS in 2012 without Lev. Our initial projections show that Cinryze could add as much as a dollar of EPS to that figure by 2012. As such, we have moved our price target to $16 per share.

&

ViroPharma "market outperform," target price raised
07/31/08 - JMP Securities

NEW YORK, July 31 (newratings.com) - Analysts at JMP Securities reiterate their "market outperform" rating on ViroPharma Incorporated (VPHM). The target price has been raised from $12 to $18.

[la-onda]

our old 13$ price target was hit today 

VPHM: Short Interest DN 15.9% to 10.2M at the End of Jul 2008
Tuesday , August 12, 2008 06:00ET

According to new short interest data from NASDAQ, short interest for Viropharma, Incorporated (NasdaqNM: VPHM) DECREASED 15.9% to 10,218,882 shares as reported at month-end July, 2008. Based on VPHM's 20-day average daily share volume of 2,036,695, it would require approximately 6 day(s) of buying to cover this short interest.

[AussieTrader]

Nice work La-onda,

We got totally faked out of VPHM when that news hit of their takeover of Lev. Once the market digested the true impact of the transaction then the price back on to original course.

Applaud for you for being able to profit on the position through that period.

[la-onda]

good news for VPHM:

Positive Study Drives Dyax Higher

08/18/08 - 02:44 PM EDT

DyaxDYAX shares shot higher Monday after the company announced positive late-stage trial results for its Hereditary Angiodema (HAE) drug DX-88, and will now complete its filing for FDA approval.

Dyax shares were up more than 10% to $4.78 in recent trading.

The company said that a phase III trial, dubbed Edema 4, successfully met its primary and secondary endpoints, replicating results from an earlier trial. Dyax also said the drug was well tolerated with no drug-related serious adverse events reported.

HAE causes periodic, acute episodes of painful swelling in a patient's extremities, gastrointestinal tract and, most dangerously, the airway passages. It's estimated that about 30% of HAE patients die due to suffocation caused when their airway swells shut.

The disease affects roughly 10,000 patients in North America, according to Dyax.

Cowen analyst Phil Nadeau, who has an outperform rating for the stock, said in a note to investors that his model projects $130 million in 2012 sales from DX-88 (Dyax posted revenue in its most recent quarter of $3.8 million, along with a loss of nearly $25 million)

With its first marketed drug, Dyax will enter a competitive market -- one that has seen a spate of regulatory delays -- for a rare disease that affects only 10,000 people in North America.

But Dyax's offering has its advantages.

DX-88 can be given to patients with a simple injection under the skin, instead of intravenously, which may make it more convenient and stronger competitor when launched.

Dyax is expected to file the last module of its application for DX-88 for FDA approval early in the fourth quarter based on the phase III study results announced on Monday. This means the company will likely have the product in market around mid-year 2009, writes Needham analyst Mark Monane, who has a buy rating and an $8 price target for the stock.

The company is in an exclusive negotiation period with Dompe regarding European rights to the DX-88 and has teamed up with CubistCBST for North American rights to the drug in another indication.

Other HAE drug developers have won premium takeout prices in recent months.

In July, ShireSHPGY announced that it was buying Jerini and its lead product HAE drug Firazyr in a deal worth $521 million. However, Wall Street widely expects U.S. approval will require another clinical trial, giving Dyax a buffer (pending approval) before this competitor enters the market. ViroPharmaVPHM also announced in July that it would spend at least $443 million to buy Lev Pharmaceuticals, which is expecting to hear from the FDA on Cinryze, its intravenous HAE treatment seeking approval to treat and prevent attacks, on or before Oct. 14.

If approved, Cinryze could still compete with Behring's Berinert P, a prospective treatment seeking approval for acute HAE attacks -- not a prophylactic, or preventive treatment for the disease.

The FDA was expected to make its decision on Berinert P on or before Sept. 6, but the company confirmed with Wall Street analysts on Friday that it has been delayed (60-90 days), based on further "data slicing requirements" according to Susquehanna analyst Jason Kolbert.

Berinert P, like Cinryze, is given intravenously, not subcutaneously like DX-88 and Firazyr.

"From our conversations with HAE patients, we know that they prefer subcutaneous therapy," says Kolbert who has concerns regarding the market size estimates represented by consensus. Kolbert believes the bigger market opportunity for DX-88 is not in HAE, but in areas such as drug-induced edema and prevention of blood loss in surgery.

Dyax recently signed an agreement with Cubist for North American rights to DX-88 in blood loss prevention in heart surgery.