Why the Pros Are Passing on Encysive Pharma

The delay in getting Thelin to market in this country has helped its competitors. Gilead Sciences(GILD Quote) is expecting an FDA decision on its PAH drug ambrisentan on Monday, just three days after Encysive is expected to hear a decision. As I've written before, ambrisentan has clinical advantages that seem to give it an edge over Thelin. If both drugs are approved, ambrisentan is expected to garner greater market share and sales than Thelin.

If Thelin is approved but only generates minimum revenue, Encysive will have a hard time justifying much of a premium to its current valuation.

Taken together, all these unknowns and issues help explain why the question of Thelin's approval is not exactly a burning question on the minds of institutional investors or sell-side analysts.