Susquehanna Initiates Coverage on WuXi PharmaTech (WX) with a Positive

September 9, 2008 9:35 AM EDT

Susquehanna initiates coverage on WuXi PharmaTech (NYSE: WX) with a Positive. Price target $24.00.

Susquehanna analyst says, "We are initiating coverage on WX with a Positive rating and a price target of $24. WX is the largest and first public preclinical contract research organization (CRO) in China, providing research and manufacturing services that support the product development initiatives of the global life sciences industry. We focused the discussions of this initiation on understanding and projecting the margins, an area that has been often scrutinized but not well understood in the context of WX's overall growth, as well as issues key to WX's short- and long-term growth: 1) revenue contribution and manufacturing capacity impact of the VRTX commercial production; 2) upcoming GLP tox service in China; and 3) the addressable market for WX and key trends in China's CRO market."

WuXi PharmaTech (Cayman) Inc. (WuXi) is a pharmaceutical, biotechnology and medical device research and development (R&D) outsourcing company, with operations in China and the United States. [SM]

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