Needham & Company Keeps Buy on Vertex (VRTX) Despite Partial Clinical Hold

July 26, 2013 8:18 AM EDT
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Price: $81.37 +0.57%

Rating Summary:
    24 Buy, 17 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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Needham & Company analyst Alan Carr is not being swayed by the partial clinical hold on Vertex (NASDAQ: VRTX) NUC inhibitor VX-135. He is maintained a Buy rating and price target of $95.00

Carr notes, "The decision is tied to liver enzyme elevations found when the drug was dosed at 400mg in a European Phase 2 trial. The hold only impacts dosing 200mg and higher in the U.S. A Phase 2 trial evaluating 200mg VX-135 in combination with daclatasvir is still underway in New Zealand and plans for initiation of a Phase 2 trial in combination with simeprevir remain on track for 2H13. However, only the 100mg arm will continue in a U.S. Phase 2 VX-135/RBV trial. Both 100 and 200mg arms had already been completed in the EU Phase 2 trial.

Successful development of VX-135 is possible, but not probable, in our opinion. The therapeutic window may be too narrow. We had not factored VX-135 in our models given development is still at an early stage. Our enthusiasm for the stock is based on the Cystic Fibrosis program, which we believe is underappreciated. We reiterate our BUY rating and recommend investors take advantage of weakness."

For an analyst ratings summary and ratings history on Vertex click here. For more ratings news on Vertex click here.

Shares of Vertex closed at $87.62 yesterday.

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