NEW YORK (TheStreet) -- Shares of Achillion Pharmaceuticals (ACHN) are plummeting, down 12.83% to $9.31 in early market trading Wednesday, as the company gets downgraded by analysts at JMP Securities to "market perform" from "market outperform" on valuation this morning.
The firm issued a price target of $24, and said it prefers to stay on the sidelines while the company reinvents itself by outsourcing its hepatitis C virus assets. Achillion will focus on its preclinical assets.
JMP believes the HCV franchise is fairly valued at current levels.
"The Factor D platform appears to have blockbuster potential, in our view, it remains early in development," the firm said in a note this morning.
Yesterday, Achillion announced that it has signed a worldwide collaboration with Johnson & Johnson's (JNJ) Janssen Pharmaceuticals in return for royalty on future HCV sales, $875 million in future milestones, and a $225 million equity investment.
Janssen will develop and commercialize one or more of Achillion's lead hepatitis C virus assets.
In addition, UBS downgraded Achillion to "neutral" from "buy" saying the company's hepatitis C virus collaboration limits near-term upside in the stock.
UBS analysts also cut their price target to $11.50 from $19.
New Haven, Conn.-based Achillion Pharmaceuticals is a biopharmaceutical company, with its primary business in discovering, developing and commercializing treatments for infectious diseases.
The company is focused on developing short-duration combination therapies for the treatment of chronic hepatitis C virus infection.