Why Idenix Pharmaceuticals Shares Plunged
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of biotechnology company Idenix Pharmaceuticals (NAS: IDIX) are dipping 15% today following analyst comments regarding its hepatitis-C drug hopeful, IDX-184.
So what: Brean Murray Corrat analyst Brian Skorney noted, in response to Roche's comments that it was experiencing unacceptable relapse rates for patients on multiple treatment combinations, that Idenix's IDX-184 may need to be used in regimens lasting longer than 12 weeks. This could be a significant setback in that it delays Idenix's clinical studies and makes it a far less attractive combination drug than its peers.
Now what: I'm personally not surprised by today's drop one bit. I've often compared the mergers in the hepatitis-C sector to tulip mania, and speculators who are betting on Idenix getting purchased may have just barked up the wrong tree. Bristol-Myers Squibb (NYS: BMY) took a big gamble in paying $2.5 billion for Inhibitex's leading drug (which was just barely out of phase 1 trials), so I'm not too high on IDX-184's chances after today's analyst comments.
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At the time this article was published Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.