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What: Shares of biotech Inhibitex (NAS: INHX) are in critical condition today, with shares shedding as much as 37% of their value, after rival drugmaker Pharmasset (NAS: VRUS) reported safety concerns with an experimental drug.
So what: The drug in question, code-named PSI-938, is an experimental hepatitis C drug currently in clinical trials. The news is rattling shareholders of Inhibitex, which also offers a hepatitis C drug, INX-189, that shares some similarities.
Now what: Inhibitex shares are climbing higher off the lows of the day, currently down "only" 21% as investors realize the knee-jerk reaction at the open may have been unwarranted. Deutsche Bank also came out this morning to defend the company, with analysts saying that there are more differences in the two drugs than similarities. Due to those differences, Deutsche Bank believes the safety characteristics of the drugs will also differ.
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