Jefferies Raises Price Target on Orexigen Therapeutics (OREX) as Contrave is Back Up & Running

Jefferies is maintaining its Hold rating on shares of Orexigen Therapeutics (NASDAQ: OREX) while raising its price target from $2 to $3.

The company formal dispute resolution was successful with the FDA now willing to accept a feasible CV outcomes trial.

The firm reports, "FDA wants a non-inferiority study ruling out CV event risk with the upper bound of the hazard ratio excluding 2.0 & 1.4, in a population w/avg. 1-1.5% background risk. This should yield a positive outcome with <10,000 patients, ~87 events and <2 years to interim."

Enrollment for the test should begin in the first half of 2012 and approval most likely will not be reached until late 2014. Jefferies notes that the test will cost roughly $10-$12 thousand per patient. The firm doesn't forecast that any equity will be need to be raised in the near-term.

For 2011, Jefferies raised its EPS estimate from ($0.72) to ($0.66) and lowered its EPS estimates for 2012 and 2013 to ($0.98) from ($0.57) and ($0.60).

For more ratings news on Orexigen Therapeutics click here and for the rating history of Orexigen Therapeutics click here.

Shares of Orexigen Therapeutics closed at $2.26 yesterday.

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