Deutsche Bank Initiates Coverage on OSI Pharmaceuticals (OSIP) with a Hold

June 24, 2009 8:05 AM EDT

Deutsche Bank initiates coverage on OSI Pharmaceuticals (Nasdaq: OSIP) with a Hold. Price target $33.

Deutsche analyst says, "We believe changes in Tarceva reimbursement & potential negative survival data from SATURN at ESMO in September could create near-term stock weakness. In addition, we see few catalysts in the next 12 months. Congress has proposed a new reimbursement system for a fraction of Medicare patients. We estimate at most 13% of US patients on Tarceva would be impacted. We do see an opportunity for Tarceva for growth beyond price increases in the US. We estimate approval in first-line patients with EGFR mutations in 2012 could increase world-wide end-user Tarceva sales by $872M by 2017. Using DCF analyses, we have assessed the stock impact to (1) an Iressa EU launch, (2) reimbursement changes, (3) maintenance use, (4) no use in first-line EGFR mutants world-wide, and (5) if Tarceva use is confined by EGFR testing."

To see more analyst ratings on OSIP Click Here.

OSI Pharmaceuticals, Inc. (OSI) is a biotechnology company primarily focused on the discovery, development and commercialization of molecular targeted therapies addressing unmet medical needs in oncology, diabetes and obesity.

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