This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Anadys' Stock Sale Doesn't Just Dilute

Stocks in this article: ANDS

The firm estimated elsewhere in its note that the funds raised should be enough to sustain operations through mid-2012, and said its thesis on the stock assumes ANA598 has the potential for peak sales of $970 million as part of a combination with a larger partner with Anadys getting royalties of 20%. Wedbush puts the probability of ANA598 reaching the market at 55%.

Unsurprisingly, the tone of ThinkEquity's note is much harsher, as the firm not only downgraded the stock, it cut its price target to $2 from $7, noting that Anadys's inability to stir up interest in ANA598 is especially disturbing given how much industry interest there's been in hepatitis C programs of late, as illustrated by Roche Holdings's deal for the rights to danoprevir with Intermune (ITMN) earlier this month, and Bristol-Myers Squibb's (BMY) agreement to acquire ZymoGeneticsTICKER TYPE="EQUITY" SYMBOL="ZYGO"/> in early September.

"We have always believed that the lack of interest by Wall Street did not reflect a lack of interest by big pharma," ThinkEquity said. "However since Anadys has come back to the capital markets for a financing, we can only conclude that our thesis was incorrect and that the pharma world is actually less interested in ANA598 than the public markets."

Talks will apparently continue about strategic deals, but barring a change in the market's attitude, Anadys could be dead money for a while with 24-week response and safety results from the Phase 2b trial of ANA598 not expected to surface until the fourth quarter of 2011, according to ThinkEquity.

The lone potential catalyst for the stock in the near term could be additional results from the phase 2a trial of the drug, which are due in the current fourth quarter. Noble Financial, which maintained its buy rating but cut its 12-month price target on the stock to $3.50 from $5 on Friday, said there's still a possibility for a partnership to surface if the data is strong enough, and it's hopeful it will be.

"The antiviral data presented so far is encouraging and in our view improves the outlook for potential partnerships," Noble said in its note.

The next dates worth paying attention to for Anadys believers will be the company's release of its third-quarter results on Oct. 25, and the American Association Study of Liver Disease meeting taking place from Oct. 29-Nov.2, where Noble thinks the next batch of phase 2a data could surface.

-- Written by Michael Baron in New York.

>To contact the writer of this article, click here: Michael Baron.

>To submit a news tip, send an email to:

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,387.21 -291.49 -1.65%
S&P 500 2,029.55 -27.54 -1.34%
NASDAQ 4,681.4970 -90.2660 -1.89%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs