Investors waiting for

MedImmune

(MEDI)

to break out of its holding pattern may have to bide their time.

Wall Street will duly inspect Thursday morning's first-quarter earnings report. But some people watching the Gaithersburg, Md., biotech say progress will be a while in coming. And that may keep the stock, which has traded in a narrow range for more than 15 months now, from moving up appreciably any time soon.

Indeed, analyst Geoffrey Porges of Sanford C. Bernstein cites "the lack of meaningful

research pipeline catalysts until 2006" and the poor showing of the FluMist nasal spray vaccine as some reasons why he has cooled on the stock. Porges cut his rating to hold from buy last month. He isn't alone: 17 analysts are neutral on the stock, while five advocate selling it and four recommend buying it, according to Thomson First Call.

Everyone isn't quite so perturbed about MedImmune, which is expected to make 36 cents a share for the quarter ended last month, down from 44 cents for the same period last year. Given the nature of its business, MedImmune's peak sales and earnings come in the first and fourth quarters.

Analyst Alex Hittle of A.G. Edwards, for instance, recently raised his rating to buy from hold, citing the company's Synagis treatment for respiratory syncytial virus, a dangerous lung disease among infants. The drug produced $942 million in sales last year, or 83% of corporate revenue.

"We believe MedImmune offers a floor value thanks to its monopoly $1 billion Synagis franchise and $1.2 billion in net cash and securities," Hittle said in a recent report to clients.

Hittle doesn't mind waiting as long as the experimental RSV drug Numax gets to the market on time. Phase III test results, the last stage of clinical trials before an experimental drug is submitted to regulators, are due in the second half of 2006.

"We believe Numax has a high probability of clinical success," Hittle says. Numax is "considerably more potent" than Synagis based on animal tests, he adds. The key test involves matching Synagis vs. Numax in their ability to prevent hospitalizations. Phase III tests of Synagis showed the drug could prevent 50% of hospitalizations, "so there is clearly room for improved outcomes" if Numax does a better job.

Another potential benefit from Numax is the fact that MedImmune won't have to share profits with

Abbott

(ABT) - Get Report

, with which it has a Synagis marketing agreement, Hittle says. (He doesn't own shares; his firm is a market maker in the stock.)

Hittle considers Numax to be the most important catalyst. Porges, though, says FluMist could have been an important catalyst, but he calls the drug a "squandered" opportunity in terms of potential revenue and relations with government purchases of flu vaccine.

Porges and Hittle both point out that MedImmune missed great opportunities in the 2003-2004 flu season, which was severe, and the 2004-2005 season, in which manufacturing problems at

Chiron

(CHIR) - Get Report

caused a loss of half of the standard flu shots in the U.S.

But FluMist's introduction in 2003-2004 was an expensive failure. The price was high, the drug wasn't approved for the most vulnerable patients and the resulting sales were distressingly small.

Burned by that experience, MedImmune cut back so sharply on manufacturing for the following season that it couldn't capitalize on Chiron's misfortune. "The environment is unlikely to be as favorable in 2005 and later years," Porges says. MedImmune "is likely to sell no more vaccine in 2005 and 2006 than in 2004."

Porges adds that the company has continued cutting FluMist's price, a strategy that has "failed to stimulate demand and eroded the future value of the franchise permanently." (He doesn't own shares; his firm is a market maker.)

The flu franchise's future lies in the late-stage clinical testing of CAIV-T, the next-generation FluMist, which is being measured against standard flu shots. CAIV-T can be stored in liquid form rather than in frozen form, thus making it easier than FluMist to ship, store and use. Results are due late this year. If it proves superior to the standard shots, it could lead to the vaccine being approved for pediatric patients, Hittle says.

But Porges says MedImmine faces more competition for the upcoming flu season, assuming Chiron returns to the market. The biggest player remains

Sanofi-Aventis

(SNY) - Get Report

. It is possible that one and maybe two other companies could enter the U.S. flu market this season or next season.

"In both 2005 and 2006, the U.S. market is likely to be adequately supplied with injectable vaccine," Porges says. "Unless MedImmune addresses the outstanding medical concerns, there will be little or no demand for FluMist."

Porges faults MedImmune for what he calls mixed signals for FluMist -- increasing the number of sales representatives but also telling investors it probably won't produce more FluMist during the upcoming season vs. the previous season. Porges dropped his FluMist revenue estimate to $17 million this year, down from a previous prediction of $100 million. Next year's estimate has been cut to $44 million from $137 million. "Even beyond 2006, we believe revenue will be materially below our prior expectations," he says.

On Wednesday morning, MedImmune was trading down 35 cents, or 1.38%, to $25.03.