ISIS: Lehman out with positive statement

Lehman is out with positive statement on ISIS, following ALNY megabuster deal with Roche. Last year, Merck paid $1.1 billion for small RNAi company Sirna. And today's ALNY deal that could surpass 1 billion (it is not an acquisition but merely non-exclusive licensing deal) clearly validates the RNA technology as one of the most sought after and promising areas for next generation drug development.

ISIS provides ALNY with exclusive license to ISIS IP for double stranded RNAi technology and as ALNY achieves major milestone with Roche, ISIS is likely to leap more revenue from ALNY's deal with Roche.

Lehman points out the extremely attractive pipeline of ISIS and thinks that pipeline platform value well exceeds the current valuation. The firm has $20 target on the company which represent near 90% gain from the current level.

ISIS got tremendous efficacy data on phase 2 trial on its ISIS 301012 to lower bad cholesterol (LDL) without significant long term side effects. This is highly prized market by the large pharma as big pharma had major setbacks in producing effective LDL lowering drugs without safety issues. In addition, ISIS 325568 and 377131 seems to be very promising in diabetes market, which is one of the largest healthcare market. Lehman point out that ISIS had received significant interest from the potential partners on 301012 and the company started a competitive ¡°auction process¡±. In my opinion, this company will not be a standalone company. Small companies in RNA space will be gobbled up by large biotech and pharma companies. As one of the most potent IP in RNA antisense technology, ISIS is a prime take-out target with substantial premium. Definitely recommends purchase of ISIS shares at current valuation.


The current stocks in that I cover are: Filthy Rich Tech ideas (comprised of Openwave, Avid Technology, Tivo, IBM, and Research in Motion), Filthy Rich Biotech ideas (comprised of Amgen, Celgene, Genzyme, Isis pharmaceuticals, Alnylam pharmaceutical, and Protein Design Lab), Filthy Rich Financial ideas (JP Morgan and Goldman Sachs), Filthy Rich China ideas (Focus Media Holding and Ctrip.com), Filthy Rich Transportation ideas ( American Airline and Southwest Airline), and Filthy Rich Specialty Retail ideas (Peet's coffee)

Please check out the archives for past posting on individual stocks. Also market commentary and weekly communication on the core holding list are available at www.investorhives.com on a membership basis. The membership is free for everyone. Simply apply for filthyrich hive membership at www.investorhives.com. Thank you for visiting my blog.