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Vertex Adds 24-Week Arm to 12-Week VX-950 study
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"Vertex May Have Removed Major Risk Factor"
Peter Kang, 04.12.06, 3:51 PM ET
Forbes.com
Piper Jaffray upgraded shares of Vertex Pharmaceuticals to "outperform" from "market perform" and said a potential change to an upcoming clinical trial reduces risk in the development of the biotech firm's lead drug VX-950.
Citing conversations with "people close to the study," analyst Rachel McMinn said a Phase II trial of the promising hepatitis C will now include a third arm that will assess 24-weeks of dosing, in addition to the previously announced 12-week dosing arm.
"In our opinion, this new trial design alleviates a major risk factor for the VX-950 program," McMinn wrote Wednesday in a note to investors. "Our primary concern with VX-950 has been that 12 weeks of dosing may generate a less than optimal sustained virologic response rate."
The research analyst lifted the price target on the stock to $42 from $38.
"We are upgrading Vertex ... based on what we view as a positive development change for VX-950, which we expect will ultimately yield a very favorable clinical outcome," the analyst said.
McMinn said Vertex's "best-case scenario" for VX-950 would be for 12-week data to be favorable enough to validate a Phase III trial initiation in mid-2007, with a market launch in 2009.
At the other end of the spectrum, the worst-case scenario would be for Vertex to wait for full 24-week data with a Phase III start at the end of 2007, and a lunch in 2010.
Vertex (nasdaq: VRTX - news - people ) is in a race with Schering-Plough (nyse: SGP - news - people ) to bring the first hepatitis C protease inhibitor to the market. Other companies working to bring new hepatitis drugs to the market include Idenix Pharmaceuticals (nasdaq: IDIX - news - people ), Anadys Pharmaceuticals (nasdaq: ANDS - news - people ) and Valeant Pharmaceuticals (nyse: VRX - news - people ).
Vertex declined to comment on Piper's report
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