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Idenix rises after HIV drug milestone payment
Shares of Idenix Pharmaceuticals Inc. edged higher Wednesday after an analyst said a milestone payment from a partner is a good sign for Idenix's antiviral drug candidates.
THE SPARK: Tuesday morning, Idenix said it will receive a $20 million payment because its partner ViiV Healthcare started a mid-stage trial of an HIV and AIDS drug candidate that Idenix discovered. ViiV Healthcare is a partnership between GlaxoSmithKline PLC and Pfizer Inc., and it works on HIV and AIDS therapies. Idenix licensed the HIV/AIDS drug to GlaxoSmithKline in February 2009. GlaxoSmithKline designated it GSK2248761.
THE BIG PICTURE: Idenix could receive another $330 million from ViiV if GSK2248761 is developed successfully, along with royalty payments if it is approved for sale.
But Idenix is still trying to determine the fate of two other drug candidates, IDX184 and IDX320, which treat hepatitis C. The Food and Drug Administration suspended trials of the two drugs in September because three patients in the trials experienced side effects related to liver function. Idenix is discussing the two drug candidates with the FDA.
Idenix shares lost about half their value after the trials were placed on hold, falling from $5.99 on Sept. 3 to $3.18 the next trading day, Sept. 7.
THE ANALYSIS: William Blair & Co. analyst John Sonnier said the milestone payment is a positive sign for Idenix's drug discovery technology. He said the company has other promising hepatitis C drug candidates, including IDX375, which is in early-stage clinical testing. He kept an "Outperform" rating on the stock.
Sonnier said Idenix will record $2.5 million of the milestone payment in the fourth quarter, with the rest of the payment spread out over 14 years.
SHARE ACTION: Idenix stock rose 20 cents, or 4.9 percent, to $4.32 in afternoon trading. Shares of the Cambridge, Mass., company have traded between $1.82 and 6.11 over the last year.
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