Player Avatar zzlangerhans (99.85) Submitted: 4/23/2013 6:48:01 PM : Underperform Start Price: $35.01 ICPT Score: +10.82

Intercept is now valued at 580M. That's not unheard of for a biopharma that recently went public in the midst of a phase III trial. Ironwood and Synageva had market caps well over a billion not long after their initial entries into the public markets. In the case of Intercept, I see vulnerability in the long time period before topline data is released in mid 2014. The major catalyst is the phase III trial of obeticholic acid (OCA) for primary biliary sclerosis. I believe the company is playing down the fact that they are developing OCA as a second-line therapy in PBS for patients who have failed treatment with the standard of care ursodiol. Also, the primary endpoint of the phase III trial is a composite of improvement in liver function tests. My understanding is that using LFT as an indicator of improvement or progression in PBS is controversial, and there is no SPA for the trial. Even with technically positive results of the trial, secondary endpoints may disappoint and the FDA may not be convinced.

I've been wrong about companies like this before and I may be completely misreading this situation. But my instinct tells me that Intercept is ripe for a pullback as traders move on to biopharmas with more near term catalysts, and on CAPS I go with my instincts.

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