Replies to post #95600 on Biotech Values

[mcbio]

Re: ACH-1625 Phase 1b final cohort data

However, a more pertinent comparison is how ACH-1625’s dosing stacks up against the newer generation of PI’s from such companies as BMY, ABT, GILD, and IDIX, among others.

We can't lose sight of the fact that ACHN has its own next gen/3rd gen PI beyond ACH-1625 in ACH-2684 that should enter the clinic in 2011.

The data today for ACH-1625 looks great to me and I'm hopeful it will be sufficient to enable ACHN to land a nice partnership for the drug before the start of Phase 2 trials. I'm not sure we can go ahead and discount a 2nd gen PI like ACH-1625 completely with the prospect of the 3rd gen PIs (like ACH-2684, IDX320, and the others). It looks like the market is continuing to do this, even with ACHN being up 20% after hours, given that ACHN is trading just north of a $100M market cap now. If we're going to start discounting earlier gen PIs, then VRTX at an ~$8B market cap tied primarily to a first gen PI starts to look quite overpriced. I would also question how certain we are that the 3rd gen PIs will be a necessary improvement over the 2nd gen PIs. The impetus behind the 3rd gen PIs appears to be that they will be much less prone to resistance compared to the earlier gen PIs, but isn't this potential advantage muted to some extent given the fact that it's expected that the earlier gen PIs will be combined with other HCV drug classes (nukes, non-nukes, etc.) which by itself is going to decrease the chances of resistance?

Given that ACHN has its own 3rd gen PI in the pipeline coupled with the strong data today for the 2nd gen PI, I'm quite comfortable in continuing to hold the stock. (I would be adding myself if I had any additional available cash at current levels.) My own personal price target for ACHN is $5/$6 per share and I don't plan to sell a single share below that level as that strikes me as fair for what the company has ongoing at the present time. All IMHO.