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Idenix Pharmaceuticals slips on quarterly loss

Associated Press / July 22, 2009

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NEW YORK - Shares of Idenix Pharmaceuticals Inc. plunged yesterday after the biotechnology company reported a wider-than-expected second-quarter loss and one analyst said financing issues could weaken its position in partnership discussions.

The stock shed $1.24 to close at reach $3.75. Shares have traded between $1.86 and $10.10 over the past 52 weeks.

Late Monday, the Cambridge, Mass., company said it lost 28 cents per share during the quarter, wider than Wall Street’s forecast of 25 cents per share. Revenue of $2.4 million also fell short of analysts’ $3.4 million forecast.

The company receives its revenue through partnerships. Its lead hepatitis C drug candidate IDX-184 recently passed a midstage “proof-of-concept’’ study. Positive results from the three-day study will prompt the company to move the drug into later stages of development and several analysts believe that Novartis AG will exercise a partnership option on the experimental drug by the end of the year.

JMP Securities analyst Liisa Bayko, though, downgraded shares to “market perform’’ from “market overweight’’ yesterday, citing the company’s financing position. The company had $51.7 million in cash, cash equivalents, and marketable securities as of June 30 and said it expects to have funding for operations through at least the first quarter of 2010.

Meanwhile, Caris & Co. analyst David Moskowitz reaffirmed a “buy’’ rating on the stock and expects shares to reach $16 over the next 52 weeks. He said IDX-184’s safety profile and better potency than a prior drug candidate will prompt Novartis to opt into the drug’s development. That could result in an upfront payment of $25 million, he said.