Medicure Inc (MCUJF)

[drbio45]

* Yesterday Medicure Inc. reported 3Q07 EPS of ($0.08) and
indicated
that its pivotal Phase III for MC-1 is on track to complete
enrollment in November. We expect Phase III results from MC-1 in
1Q08. Medicure reported 3Q07 Aggrastat revenues of $2.52M. We
find
it encouraging that Aggrastat sales are up nicely
quarter-over-quarter. Our long-term estimates, primarily driven
by
MC-1, remain unchanged. We have made minor changes to our
near-term estimates based on a better understanding of near-term
cost drivers.

* Approximately 90% of Medicure's R&D expenses are attributable to
MC1. There were significant up-front costs in starting the MC-1
trial, which resulted in higher than normal R&D in Q3. R&D is
likely to be high over the next few quarters as Medicure
continues
to enroll patients, after which we believe it is likely to
decline
from current levels.

* Due to its poor brand image in the US, we give very little credit
to Aggrastat. However, we believe its brand image could be
improved with additional data from head-to-head studies against
competitors such as ReoPro and Integrillin. We were pleasantly
surprised to hear on the conference call that Merck is running
several large trials to prove equivalence of Aggrastat. Positive
results from these trials could lower the risk for Medicure in
running similar trials in the US, which could eventually lead to
substantial sales growth for Aggrastat, in our view. We believe
that results from these trials could become available as soon as
at ACC next year. We are not altering our current Aggrastat
forecast of no change in sales from 2007 to 2012.

* Management clarified that the p-value needed for success in the
Phase III trial was close to 0.05 but lower than that, and at the
same time much higher than 0.01. We believe this is a good
revelation because there have been rumors that the statistical
barrier for the Phase III trial is very high owing to the
substantially low p-value that is required to be met.

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