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

[Michael]

UPS - TA is a dangerous thing and I got so entangled in Bollinger bands that I forgot to comment on Olivers massage.

From my perspective the message is that if there is seasonality in Diff C infections you might look at a 45% increase in prescriptions for the coming 3 months. I have not been able to find date more than 2 years old and even though there is some seasonality there is not data enough to make a definite statement.

Mike

[KCScott]

I have smitted myself for making that wait till $ 18.70 buy call

You can tune a piano or just have one fall on your head

[la-onda]

updated numbers:

http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=7077380&tid=vphm&sid=7077380&mid=91903

& news:

ViroPharma using VA doctor's research
Monday February 27, 12:05 pm ET

ViroPharma Inc. entered into a licensing agreement Monday with Dr. Dale N. Gerding, associate chief of staff for research at the Hines VA Hospital in Chicago, for the rights to develop nontoxigenic strains of clostridium difficile for the treatment and prevention of clostridium difficile-associated disease (CDAD).
Financial terms of the deal were not disclosed.
The Exton, Pa., specialty pharmaceutical company plans to initially focus its efforts on the opportunity to prevent recurrence of CDAD following treatment with its antibiotic Vancocin.
"We are very excited to be chosen to enter into this agreement with Dr. Gerding to acquire the rights to this very promising early-stage therapeutic opportunity, as it fits perfectly with our strategic focus on this dangerous disease," said Dr. Colin Broom, chief scientific officer of ViroPharma (NASDAQ: VPHM - News).
About 400,000 people a year in the United State are infected with CDAD, typically older patients in hospital settings. Its symptoms range from diarrhea to severe inflammation of the lining of the colon to perforations of the colon, and even death.

[la-onda]

VPHM: Short Interest UP 13.2% to 5.8M in Feb 2006

Monday , February 27, 2006 16:31 ET

According to new short interest data from NASDAQ, short interest for Viropharma, Incorporated (NasdaqNM: VPHM) INCREASED 13.2% to 5,792,152 shares for the month ended mid-February, 2006.

SYMBOL     JANUARY        FEBRUARY          CHANGE       %CHANGE      DAYS/COVER
--------   -------------   -------------   -------------  ------------  ----------
VPHM           5,117,496       5,792,152        +674,656       +13.18%           5
Based on VPHM's 20-day average daily share volume of 1,371,675, it would require approximately 5 day(s) of buying to cover this short interest.

[cjm]

Looks like VPHM had a great quarter. Stock is up $0.90 premarket

http://biz.yahoo.com/prnews/060228/nytu060.html?.v=43

[tommyt]

If I am correct, guidance of $2 eps for 2006 makes this about a $60 stock.
Current P/E of 8.20? Come on...this should be a 40+ stock now, talk about a value play.

[la-onda]

  
ViroPharma Incorporated Reports 2005 Financial Results and Provides Guidance

Tuesday , February 28, 2006 07:59 ET

Feb 28, 2006 /PRNewswire-FirstCall via COMTEX/ -- ViroPharma Incorporated (Nasdaq: VPHM) reported today its financial results for the fourth quarter and twelve months ended December 31, 2005.

Net sales of Vancocin(R) were a record $40.3 million for the fourth quarter of 2005 and $125.9 million for the twelve months of 2005. This compares to $8.3 million for the fourth quarter of 2004. Sales during the 2004 periods are not comparable to the 2005 periods as the Company acquired Vancocin from Eli Lilly and Company in November 2004. Unaudited net sales of Vancocin for twelve months of 2004 were $54.0 million.

Operating income in the fourth quarter and twelve months ended December 31, 2005 was $28.2 million and $88.1 million, respectively, compared to operating income in the fourth quarter of 2004 of $9.8 million and operating loss in the twelve months of 2004 of $12.0 million. The improvements in operating results from 2004 to 2005 were driven primarily by sales of Vancocin and the related cost of sales.

The Company recorded an income tax benefit of $47.8 million in the fourth quarter of December 31, 2005 to establish deferred tax assets. In addition, for the twelve months of 2005, the Company recorded $10.0 million in income tax expense. These two items resulted in a net income tax benefit for the year of $37.8 million.

Net income in the fourth quarter and year ended December 31, 2005 was $72.7 million and $113.7 million, respectively, compared to net income of $5.8 million and net loss of $19.5 million for the same periods in 2004. Net income per share for the quarter ended December 31, 2005 was $1.21 per share, basic, and $1.17 per share, diluted, compared to a net income of $0.22 per share, basic and diluted, for the same period in 2004. Net income per share for the year ended December 31, 2005 was $2.56 per share, basic, and $2.02 per share, diluted, compared to a net loss of $0.73 per share, basic and diluted, for the same period in 2004.

The primary drivers of the improved results were the effects of operating income and the income tax benefit of establishing deferred tax assets in 2005, partially offset by debt-related costs. The $47.8 million of income tax benefit that was recorded to establish net deferred tax assets increased net income for the fourth quarter of 2005 by $0.80 per share, basic, and $0.76 per share, diluted, and for the twelve months of 2005 by $1.08 per share, basic, and $0.83 per share, diluted. The Company currently does not anticipate income tax benefits of this magnitude in the foreseeable future. Due to the recognition of the deferred tax assets in 2005, the Company currently expects, for financial statement purposes, an effective income tax rate of 38 percent in 2006.

"ViroPharma's simple goal is to create shareholder value by delivering growth, in the short term, mid term, and long term," commented Michel de Rosen, ViroPharma's chief executive officer. "2005 was a year of tremendous performance for our company. To continue growth in the future, we count on several engines: more growth of Vancocin fueled by increasing incidence and severity of disease associated with the ongoing C. difficile epidemic; our current pipeline of clinical compounds, including maribavir for CMV and HCV- 796 for hepatitis C; and the value drivers that we hope to add to the company as a result of our business development efforts."

Vincent Milano, ViroPharma's chief financial officer and chief operating officer, continued, "We are very excited by the expected continued growth of Vancocin in 2006 and beyond, and its implications on our long term financial prospects. The expected growth of Vancocin this year will drive a significant increase in our operating income in 2006 and allow us to make investments in our clinical development and medical education programs during 2006 at a substantially higher rate than we experienced during 2005. Further, we anticipate improvements in gross margins, due the approval of our third party supply chain, in the second half of 2006 and into 2007. We expect these improvements to positively impact our operating income beyond 2006."

Operating Highlights

Net sales of Vancocin were $40.3 million and $125.9 million for the three and twelve-months ended December 31, 2005, respectively, driven by price increases and prescription demand. Prescriptions increased 39.5 percent and 34.5 percent for the three and twelve months ended December 31, 2005, respectively, as compared to the same periods in 2004. Additionally, while fourth quarter 2005 prescriptions decreased approximately four percent from third quarter 2005 prescriptions, net sales of Vancocin in the fourth quarter of 2005 increased 13 percent over the third quarter of 2005. The prescription trend in the fourth quarter of 2005 compares favorably to the six percent decrease experienced from the third to fourth quarter of 2004.

The gross margin rate was 86 percent for the twelve-months ended December 31, 2005 and 79 percent for the portion of the fourth quarter of 2004 during which the Company owned Vancocin. The increase is primarily the result of the price increases since the Company acquired the product in November 2004.

The total costs and expenses associated with operating income (loss) were $12.3 million and $8.7 million, for the fourth quarter of 2005 and 2004, respectively, and $44.3 million and $34.4 million, for the twelve-months of 2005 and 2004, respectively.

The Company's effective income tax benefit rate was 49.8 percent for the year ended December 31, 2005. The Company's income tax benefit of $37.8 million for the year ended December 31, 2005 includes $47.8 million to record deferred tax assets by reducing the valuation allowance. This was necessary as the Company believes it will utilize a portion of the net operating loss and credit carryforwards, among other things. Additionally, the Company recorded income tax expense of $10.0 million based on a combined federal and state estimated annual effective tax rate of 13.2 percent. The estimated annual effective tax rate was based on our estimated taxable income for 2005, which includes, among other things, the utilization of a portion of our available net operating loss carryforwards.

Net sales in 2005 exceeded the maximum milestone threshold of $65.0 million as set forth in the Lilly agreement in connection with the Vancocin acquisition. As a result, the Company recorded additional purchase price of $10.5 million to intangible assets in 2005, which was paid to Lilly by December 31, 2005. This also resulted in additional intangible amortization of $0.3 million in the twelve-months of 2005.

Debt Highlights

During 2005 the Company raised an additional $12.5 million of debt and reduced its debt principal by $124.0 million through $49.0 million of purchases of convertible subordinated notes and by the conversion of $75.0 million of senior convertible notes. On March 1, 2006, the Company will redeem the remaining $78.9 million principal amount of subordinated convertible notes, which will eliminate all long-term debt that was outstanding at December 31, 2005.

The increase in the twelve months of 2005 for interest expense was due to the interest, amortization of financing costs, and debt discount from the senior convertible notes, issued in January and April 2005. The decrease in the fourth quarter of 2005 results from having a lower debt balance compared to the same period of 2004. Interest expense in 2005 also includes the $1.5 million related to the beneficial conversion feature for the settlement of the make whole provision of the senior convertible notes in shares of common stock.

Cash Highlights

As of December 31, 2005, ViroPharma's assets included approximately $233.4 million in cash, cash equivalents and short-term investments, which represents a $189.2 million increase from December 31, 2004. This increase is primarily the net proceeds of $163.5 million from the December 2005 issuance of common stock, the result of strong operating results less $54.4 million used for repurchases of convertible subordinated notes and make-whole payments on the senior convertible notes. In addition, there was an increase in cash of $12.5 million related to the exercise of the purchase option by the holders of the senior convertible notes in April 2005.

Looking ahead to 2006

ViroPharma is announcing guidance for the year 2006 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 2006, ViroPharma expects the following:

    --  Net sales are expected to be $160 to $170 million, representing growth
        of 27 percent to 35 percent over 2005;

    --  Operating income is expected to grow 10 percent to 25 percent over
        2005;

    --  SFAS 123R impact to operating income in the range of $3.5 to
        $4.5 million, not reflected in operating income growth above.
        Operating income growth including the impact of SFAS 123R is expected
        to grow 5 percent to 20 percent over 2005.

[la-onda]

Briefing Summary of VPHM CC
by: stalinsrevenge_mom  02/28/06 11:08 am
Msg: 92518 of 92584

28-Feb-06
11:07 VPHM ViroPharma on Conference Call (19.47 -1.83) -Update-

Will focus on execution in 2006 and building business... co expects to add one or two meaningful valuable drivers in 2006... in Q1 expect to become debt free; in Q2 hope to present a series of new data, eternal goal of mid year to initiate Phase III of Maribavir... believe Vancocin may still be underutilitzed... One analysts asks why conservative rev guidance on Vancocin: co considers guidance given for 2006 is realistic guidance; on the price front, co states they never comment on price increases before they execute them; states that people should not expect co to be as aggressive with price increases as they were in 2005; co says should know that they decided a 6.8% price increase for Vancocin... guidance confusing to analysts: analysts states if one looks at 4Q04 and compare it to the high season of 2005 one would see a 30% increase in the usage of Vancocin; analyst keeps asking if there is something else imbedded in guidance or just very conservative: co says obviously there is uncertainties with seasonally; co says have 1 or 2 of evolving epidemic to base data on; co says they give no quarterly guidance since it is difficult to predict; in 2005 delivered more than expected in 2005; when looked at 2006 looked at a number of factors; co came to guidance based on review says it is realistic, would be happy if they could do better... Analysts says when they look at prescription growth trends they see a seasonal effect; co says they see no reason why there should be no seasonality; not ready to starting giving all the metrics in the guidance

http://finance.messages.yahoo.com/bbs?action=m&board=7077380&tid=vphm&sid=7077380&mid=92518

nice summarization IMO

[la-onda]

fyi:
VPHM: JMP Sec Keeps @ Mkt Outperform; Cuts Tgt to $26 vs $28; Analyst Notes
Tuesday , February 28, 2006 15:30 ET

Issuer: Viropharma, Incorporated (NasdaqNM: VPHM)

Analyst Firm:  JMP Securities

Ratings Action: REITERATION

Current Rating: Mkt Outperform

Target Price Action: DECREASE
Target Price: $26.00 (-7.14% from $28.00)

Analyst Comments: ViroPharma has reported 3Q05 financial results. 4Q Vancocin sales of $40.3 million beat the firm's estimate $37.1 million. 4Q EPS of $1.17 (41c excluding a one-time tax benefit) vs. firm's estimate of 31c and the Street consensus of 28c. Consequently, the firm is lowering their 2006 EPS estimate (excluding 123R) from $1.11 to $1.02, which leads them to lower their target price.

[tommyt]

I don't know if this is good, but Cramer was all over this tonight:

http://www.thestreet.com/_tscnav/funds/madmoneywrap/10270939_4.html

Vibrant Viropharma

Cramer headed back to biotech, specifically to Viropharma (VPHM:Nasdaq - news - research - Cramer's Take). The stock "got trounced" on Tuesday, Cramer said -- it closed regular trading off 9% -- after reporting fourth-quarter earnings. While the company posted "good numbers," Cramer said, the problem it ran into was its guidance, which wasn't as good as expectations.

But that's not something to worry about, Cramer said. The company is playing the "UPOD" game -- under-promise on guidance and overdeliver on earnings, he said.

After the selloff, the company is looking like a good buy, he said. Investors who have shorted some 9% of Viropharma's shares should clear those positions and get long, he recommended. After closing at $19.35 on Tuesday, the stock is headed for $30, if not $40.

"It's time to consider buying a lot of it," he said.

The reason for Cramer's bullishness: Viropharma has a drug that could be the "next big thing," he said.

Much of Viropharma's current business is centered on the drug Vancocin, which combats certain bacterial infections. The company purchased the drug from Eli Lilly (LLY:NYSE - news - research - Cramer's Take) for a pittance, some $120 million, Cramer noted. In contrast, the company posted nearly $126 million in sales of the drug last year alone, he said.

Those sales should grow 30% just due to expected price increases, he said. Meanwhile, demand for the drug should grow another 10%, he said. That adds up to 27% to 35% growth, Cramer said, a forecast he called "conservative."

Vancocin is the reason why Viropharma is profitable," he said. "And it's why they should keep making more and more money."

But the company is not just a "one-trick drug pony," Cramer said. The company has another drug coming online called Maribavir, which should help prevent infections related to organ transplants, he noted. That drug alone should bring in $500 million in sales, he said.

"I don't think I'm being wildly optimistic," he said.

[KCScott]

Speaking as someone who was "Cramerized" on REDF short, all I can say is back up and get out of the way.

I'll be buying at the open.

So much for almost getting to 18.70

[ScottishTrader]

Yeah I got in yesterday when I thought the selling was done, just under $20.  And then after a brief fight it headed south again!!

Thanks Cramer, sometimes he gives a well needed shot in the arm.  VPHMs numbers looked excellent, and while it sounds like their guidance was a bit muted, a drop of almost 10% was certainly not warranted.  Hopefully Cramer's 'mon back is what was needed to push it into the mid-high 20s a la REDF, when Cramer pumped it.  Up up and away

Needs to get through resistance at 21.30 and 22.30, but I think there will be solid action today.  May look for a selling target near the upper bollinger band  (ideally after a breach of it), as Luke observed, the BBs seem to provide good buy/sell indicators on VPHM.

[Lucas Scott]

I bought today at the open. What can I say, Cramer's words moved me. $-)

[bjc]

Is this a relied upon way of drawing trendlines?

I've noticed calven using such trendlines, and he is obviously one of the most respected traders around here. 

[ScottishTrader]

Yep bjc,

That's about bang on for the long term trend of VPHM - has several nice confirmations of that trendline as support and then resistance  Especially when you see how VPHM rode up the trendline after breaking it, confirming it as ascending resistance.  Now it does make a nice target, as we can be pretty sure that IF VPHM makes it up to that trendline it may have a struggle brekaing through it.  That is IF it makes it up there - it still has a way to go yet (and today's action, especially after Cramer's pump and the huge volume strikes me as a little strange - I would have expected to see it run more, unless the price was being kept down to accumulate shares for the big boys).  We shall see tomorrow if that is the case and we get a move above $21.

For now, I think the short term patterns ar more important, particularly key support/resistance levels.  Today demonstrated support below 20.50, as it couldn't be held below this level for long.  Below this there should be support around 19.80, but for a short term trade, I don't wwant to see it heading below 20 again.  First resistance I would expect to be around 21.30, which hopefully we will test tomorrow, above that, 22.25-22.30.

My first target for this move is the top of the BB and the descending trendline from Nov and Jan highs.  This comes in right around 23.00 at the moment.  I also see an upward channel, which if we aim for the top of, would currently be just over $24.  This is also approaching the all time high of 24.36.  Above this is your trendlinne target, which I would guesstimate at around 26.50-27.00 at present.  It is totally attainable, but I think it is important to set intermediate targets and assess how the stock is reacting at these levels before shooting for the moon.

Here is a big chart that is hopefully not too confusing (I know its a bit busy).  By the way, this is just my opinion on VPHM, as always, it is up to each person to make up their mind on how to read it