Idenix Pharmaceuticals (IDIX)

[DewDiligence]

Susquehanna Upgrades Idenix

[Nothing new here for those who listened to the JPM webcast and have been following the company.]

http://biz.yahoo.com/ap/080111/idenix_pharmaceuticals_mover.html?.v=1

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Friday January 11, 11:18 am ET

Susquehanna Analyst Says Idenix Shares Priced at a Discount, Praises Early-Stage Pipeline

NEW YORK (AP) -- Shares of Idenix Pharmaceuticals Inc. edged higher Friday morning, as a Susquehanna Financial Group analyst praised the company's strong cash position and "promising" early-stage drug development pipeline.

Cambridge, Mass.-based Idenix, which is majority-owned by Novartis, develops drugs to treat hepatitis C and HIV. Analyst Jason Kolbert upgraded his rating on Idenix to "Positive" from "Neutral," saying the stock is priced attractively and carries limited risk.

In a note to clients, Kolbert said the company's current stock price in the $4-range ignores Idenix's pipeline potential. He thinks upcoming HIV data in February and other results due in April will provide positive catalysts for the stock, estimating that clinical progress could easily justify a valuation between $5 and $10.

Shares rose 12 cents, or nearly 3 percent, to $4.20 in morning trading.

Last year, the company's shares plunged from $10.80 to $2.10 following the demise of Idenix's lead hepatitis C candidate valocipitabine, but in October, the company changed its Tyzeka/Sebivo arrangement with Novartis from a joint development to a royalty stream arrangement, and restructured to focus on their hepatitis C and HIV pipeline.

Kolbert said data Idenix presented Tuesday on its second-generation polymerase and protease inhibitor compounds for hepatitis C indicates this R&D focus is beginning to bear fruit. He noted that the compounds could be free of the systemic side-effects that plagued valopicitabine but still be effective at low doses.

Finally, Kolbert noted that the company's strong cash balance contributes to a lower risk profile. The company on Monday reaffirmed it expects to report ending fiscal 2007 with between $100 million and $110 million of cash, cash equivalents and marketable securities.
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