InterMune, Inc. (ITMN)

Pullback Likely on Relatively Weak Stock

undervalued pipeline, period

Won't get a decision from the FDA until the middle of next year.

hpc trials are taking this company higher almost daily feb 2009 (best owned performer)

With CAPACITY ready to roll and FDA announcement in about 10 months, the high short interest should continue to push the shares higher as short sellers begin to exit.

Mixed data on PFD (pirfenidone) for IPF (idiopathic pulmonary fibrosis) make the regulatory path uncertain. FDA usually don't accept exploratory data analysis. Its HCV program yields good data, but may lose to the crowded competitors. Higher debt than cash is another warning sign. I expect to drop under 10.

Strong results of trial

CEO looking at all possibilities to bring drug to market

Drug companies are losing revenue with drugs coming off patent so will be eager to buy new drugs

Seems like this stock has been moving in a clear pattern this year. If the trend keeps up, its going down from here.

Plus the company has no drugs pending approval anytime soon, in the meanwhile they are stuck with a negative balance sheet.

Hot stock with lots of potential. By '09 if product gets approval, this stock could be trading above 100-150, delving this company into a multi-billion dollar profit margin within a few short years.

Finding a single compound as an inhibitor of Hepititis C virus (HCV) is not an easy task. HCV has 6 different genotypes and within each genotype there are a number of subtypes. It is an RNA virus which mutates very quickly. Therefore in a single infected individual there are a number of quisiespecies which may behave differently under certain environments. Therefore a single small molecule species that inhibits one or a number of quisispecies will select for the ones that are not inhibited. This path with protease inhibitors was tried before and failed for this reason. It inhibited only one genotype of the virus and not others. Two other reasons that the odds are against seeing a new class of HCV drugs is this; the only animal model for HCV is the Chimp and a true in-vitro (cell culture) model was just discovered 2 years ago. The chimp is not a good model because it is protected and also expansive. They are, also, naturally able to clear the infection on their own, therefore no drug studies are possible. The new in vitro cell culture is great but the HCV strain that actually replicates in cell culture is a 2a strain and not genotype 1. Why is this important? Genotype 1 is the strain most prevelant in the US and it does not respond well to current therepy.
I hope this is usefull.

InterMune, Inc. (InterMune) is a biopharmaceutical company focused on developing and commercializing therapies in pulmonology and hepatology. The company derives its revenues primarily from its solitary product Actimmune which is meant to treat patients with severe, malignant osteopetrosis and chronic granulomatous disease (CGD).

InterMune has a pipeline addressing idiopathic pulmonary fibrosis (IPF) and hepatitis C virus (HCV) infections. The pulmonology portfolio includes two Phase 3 programs evaluating possible therapeutic candidates for treatment of patients with IPF. The hepatology portfolio includes the HCV protease inhibitor compound ITMN-191 which is in its phase I trials. ITMN-191 has the potential be a best-in-class protease inhibitor for hepatitis C.

The company’s financial performance is nothing to write home about as it continues to be saddled with losses. However there are certain positives emanating from its pipeline. In last quarter of 2006, the company announced collaboration with Roche for the development and commercialization of ITMN-191. Under the terms of the agreement, InterMune receives an up-front payment of $60 million, and is eligible for up to $470 million in milestones, $35 million of which could be received over the next 12 months. Besides the data as regards Phase 3 trails of interferon gamma-1b meant for IPF would be out in early 2008 would have profound influence on the stock.

The company’s valuation looks extremely rich. Especially considering the fact that its equity value is negative and it’s still losing cash at operating level. In an environment where risk appetite is getting lower every day, such adventurous stories which requires leap of faith would find few takers. Thus, this stock is likely to underperform in the medium term

Cawabonga!!!!

ITMN's hep C product has a chance to become a standard treatment, alongside VRTX's product. Recently a quick test for Hep C was introduced and is being marketed to doctors. It could make it more common for Hep C testing to become a standard screen, since many who have it don't become symptomatic for 20 years. With drugs like Intermune's, the course of treatment is shorter than with Interferon, and doctors may be more wiling to prescribe to patients who are not yet symptomatic.

They are on track and headed in the right direction

4 paws and a hoof ^
on this one. Biotech will outperform over the long haul! Hep C is the fastest growing epedemic we have in America today. Too many people have turned a blind eye to this disease on their way to fight HIV in Africa.

The deal with Roche will really help this young biotech to develop its drugs without worrying about dilution or debt. The downside is that its top drug is now being shared which does limit the profit upside that will be shared with Roche.

As Vertex moves forward with their Hep-C protease inhibitor all biotechs in this space will experience rising share prices and Intermune will be one of them.

This biotech was chosen by RB guru and perennial CAPS all-star Charly Travers. It is even cheaper now than when he reccommended it. For good measure, the whole biotech market has been beaten up lately. Good stock and good timing it seems to me.

Picked by lanoush