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Deutsche Bank Starts Achillion Pharmaceuticals (ACHN) at Buy, Calls Under-Appreciated

September 19, 2012 6:55 AM EDT Send to a Friend
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Price: $2.83 --0%

Rating Summary:
    8 Buy, 6 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
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Deutsche Bank initiates coverage on Achillion Pharmaceuticals (NASDAQ: ACHN) with a Buy and $12 price target calling it unpartnered and under-appreciated in value but not for long.

The firm expects the company's HCV franchise will take significant shape over next 6-9 months. "ACHN's first R&D Day is 9/27. We believe ACHN has HCV drugs that will be very competitive in a big HCV market... We think 3102 will show easily over 3 logs of viral reduction making it very competitive relative to all classes of HCV drugs. Our focus will be on the resistance profile for 3102. We think 3102 could work in mutations where first gen NS5As (ABT&GILD) do not. We expect some color on this at R&D Day."

Commenting on potential M&A, the firm said Achillion could be acquired as their safety database & SVR results emerge from NS5A/PI trial over 2013. They have an Our M&A DCF assumption of $20-26. "In spite of challenges in HCV, no one is losing interest in the space from speaking to ACHN management. As mentioned in Bloomberg on 8/28/12, many big pharma companies have interest in ACHN. We think acquirers range from current HCV developers to white space players not in HCV. They will want MORE safety in light of recent setbacks & likely lower takeout premiums."

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

Shares of Achillion Pharmaceuticals closed at $8.10 yesterday.




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