ImmunoGen Inc.'s stock (NASDAQ:IMGN) fell nearly 24 percentto $7.25 a share in heavy trading on Thursday after Hambrecht& Quist Inc. analyst Wole Fayemi downgraded his rating on thecompany to a "hold" from a "buy."
More than 2.7 million shares changed hands Thursday,compared with average daily volume of 115,200 shares.
Fayemi based his reasoning on the fact that the start date ofthe Cambridge, Mass., company's Phase III clinical trial of itslead product Oncolysin B is "well behind" his most recentexpectations. So is the start date for a second Phase III trial onthis compound, in a different setting.
Fayami concluded that "these delays adversely impact ourearnings projections. ... Our revised estimates now projectprofitability for the company in 1998, compared with ourprevious estimate of 1995. ... Until we see further progress inthe company's first generation of products, particularlyOncolysin B, we are lowering our rating on the stock."
ImmunoGen spokesman Mark Ratner responded that thecompany had also expected to start the first Oncolysin B trialby the end of 1992. "We acknowledge that we were overlyoptimistic in expecting that trial to start by the end of 1992,but we'd like to emphasize that the inability to start is basedsolely on a complicated negotiation with a cooperative oncologygroup. ... This is a bureaucratic issue."
Ratner added that ImmunoGen believes that Fayemi has "noissue with the underlying technology."
-- Jennifer Van Brunt Senior Editor
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