Replies to post #105711 on Biotech Values

[NYPharmer1]

Nice DD!

[mcbio]

Re: Roche/ITMN/(ACHN)

ITMN—I interpret the news as Roche’s agreeing to pay $175M merely to be free and clear of contractual obligations stemming from the 2006 Roche-ITMN partnership for HCV protease inhibitors. Inasmuch as there are newer and better PI’s available, I doubt that Roche will advance ITMN-191 to phase-3.

That ITMN-191 does not have what it takes is old news: e.g. #msg-46797334, #msg-53621981, #msg-53624063.

We are spot on in agreement here. No surprise given our prior discussion surrounding this topic (#msg-52705841). If we are right in our assumption, and one is to assume that Roche is still committed to the HCV space (and PIs in particular), then I interpret today's news as bullish for ACHN. If Roche wants another HCV PI, ACH-1625 is presumably the most advanced unpartnered HCV PI in the clinic having just started Phase 2. And of course it has QD dosing potential. Thoughts?

[ghmm]

ITMN:

IMO Roche will advance the compound and the data will determine if it goes on or not. I think its still premature to right off the compound. 175M is a fair chunk of money (that is more then Achillion's market cap and 2/3 Idenix's) and probably represents fair value not just "go away" money. I do agree that Roche probably didn't care for the exclusivity and if they do a future deal will likely not have that language. But I think they could have gotten out of the contract with Danoprevir returning it to InterMune so it leads me to think they want to at least see what the future holds. Plus I think it may have only been another year or two to go on the exclusivity. Who knows the INFORM series could end up adding another compound (outside of ritonavir) or perhaps PEG/Riba in INFORM ends up producing outstanding results with good tolerabilty and Roche moves in that direction?

That being said if Roche announces a partnership deal in the next couple months then I will concede the death of 191 and this was go away money :-).

[rajaram46]

DEW,

Do you see ITMN as a good short candidate? Maybe a direct short or a put spread? There seems to be nothing in the pipeline worth the market cap.