Antiviral work helps Idenix buck biotech stock trend
There’s at least one bit of bright biotech news amid all the economic ugliness.
Cambridge-based Idenix Pharmaceuticals (Nasdaq: IDIX) ended the year with its stock price up 114 percent, compared with the biotech industry that overall by one measure — an analysis by the Biotechnology Industry Organization — was down by a median of 61 percent.
CEO Jean-Pierre Sommadossi said the recipe was simple.
“We set out our goals for the year, and we met every single one of them,” he said in an interview.
Idenix, which employs 180, plans to have big news in the next few weeks — an agreement to outlicense its HIV drug, IDX899, which is in phase 2 clinical trials. The negotiation process began in the spring, and equity analysts say a license agreement is currently being worked out by attorneys.
The company already has one drug on the market — Tyzeka/Sebivo for hepatitis B — that is licensed to Novartis. A report by Standard and Poor’s projects 2009 sales for the company to be $11 million, mostly due to royalties from Tyzeka/Sebivo.
The stock climb came even though the company remains unprofitable and had an operating loss in each of the last four quarters. Standard and Poor’s predicts operating losses for the next few years as the company focuses on expensive research and development activities.
Idenix raised a total $68.5 million in two venture rounds before it went public in 2004. The IPO was worth $140 million and a second offering in 2005 yielded $150 million. The stock closed at $5.70 on Jan. 14, following a high of $10.10 over the last year. Standard and Poor’s projects a 12-month target share price of $7.
The drug candidate up for sale would be part of a cocktail typically taken by HIV patients, and would target drug-resistant forms of the virus.
Up to 15 percent of patients newly diagnosed with HIV are infected with a strain which is resistant to at least one drug currently on the market. Once that deal goes through, the company plans to focus its efforts on developing three drug targets for hepatitis C.
Idenix has just announced it is initiating a proof-of-concept human trial for one of the three, IDX184. The drug target would focus on patients who have not yet received any treatment.
Idenix competitors include Gilead Sciences of California, Bristol-Myers Squibb is in New York and GlaxoSmithKline, all of which have HIV drugs that have been approved by the U.S. Food and Drug Administration.
Locally, Panacos Pharmaceuticals Inc. (Nasdaq: PANC) in Watertown, a 42-employee startup with research operations in Maryland, wants to be among the first out of the gate with its drug Bevirimat, which is designed to hit an HIV virus target discovered about a decade ago.
Idenix ended 2008 with approximately $46 million in cash and cash equivalents.
Company officials said Idenix would need that money, plus the proceeds from the licensing of the HIV drug, to get through the next year. Sommadossi said the company’s ultimate goal is to become the first biopharmaceutical company in clinical development with hepatitis C drugs from three different classes.
Unless Idenix gets bought first.
“It would be up to the board to decide if the sale of the company would be in the best interests of the shareholders. But the challenge for any deal over the past few months has been valuing the company. Our market cap has varied up to 20 percent to 30 percent in a single day,” Sommadossi said.
Julie M. Donnelly can be reached at email@example.com.