Momentum Players

[RonnieBrown]

DVAX>>Next ACOR..Read...Buy of the year.

Pacific Growth analyst: at least $20 7-Oct-06 10:30 am
Conclusions and outlook
We believe that DVAX is making solid progress pushing Heplisav and
Tolamba through development and towards commercialization, and the recent
investment in Symphony Dynamo would potentially generate value in the early
pipeline as well. Upcoming catalysts in the next 6-9 months include data
release from the Phase III Heplisav study in older adults during Q4:06, and
one-year data from the Tolamba DARTT study and two-year data from the Tolamba
pediatric study during Q1:07. We expect these studies to be positive, which we
think may lead to partnership deals significant to the Company. We continue to
believe the technology value for Heplisav and Tolamba to be $7 and $13/share on
conservative assumptions, respectively. With approximately one year of cash on
the balance sheet, the Company commented that various financing options are
being sought, and we suspect a financing event could occur by YE:06. We believe
the short cash runway has likely created an overhang on the Stock. We reiterate
our Buy rating ahead of the upcoming catalysts and on what we feel is a
compelling valuation.