Centocor Inc.'s continued silence on the fate of its Centoxinproduct at the FDA has left analysts scrambling to makereasonable projections about the future of the drug -- and thecompany.

Following Wednesday's news that the Food and DrugAdministration has requested more information on the sepsistreatment, Cowen & Co. analyst David Stone knocked 75 centsoff his 1992 earnings estimate, to a 70 cent per share loss froma 5 cent profit.

Stone, who lowered his rating to "neutral" from a "short-termbuy," told his sales force that he believes the FDA wants moreinformation or additional analysis of the clinical data. "Wethink the questions are answerable, but not without some timeand effort to do the analysis," he said. "We're not talking aboutmore clinical trials."

PaineWebber analyst Linda Miller agreed. "From what I heardfrom the company, it sounds like a two- to four-month delay.The company said there are no manufacturing issues, and Iassume if they had to do another clinical trial, they'd have toreveal that," she said.

But SoundView analyst Larry Bloom, the most negative ofseveral analysts interviewed by BioWorld, said: "Thecombination of my reading of Centocor's press release and theirsilence makes me think the problem is more serious than theStreet believes. I think there's a 25 percent chance Centocorwill pull the drug and not go forward with it."

Without Centoxin, Centocor stock would be worth $25 to $30because the company won't have earnings until late 1995 orearly 1996, Bloom said.

He said Centoxin most likely will be delayed and ultimately willget a narrow label approval. "That makes the stock worth aboutin the mid-$30s," Bloom said. He changed his rating from "buy"to "sell" and lowered his 1992 earnings estimate to 10 centsfrom 75 cents.

Miller, who still rates the stock "attractive," projects earningsbetween break-even and 80 cents this year, depending on thetiming of Centoxin approval and sales. She predicts Europeansales of about $50 million and U.S. sales of $150 million to $200million.

The stock (NASDAQ:CNTO) rose 88 cents to $34, after losing$8.13 on Wednesday.

If Centoxin isn't marketed or if its sales are smaller thananticipated, the company's next big product probably will notcome to market before 1994. Centocor has less than $200million in cash reserves and a burn rate of $50 million perquarter. "A delay of a quarter or two is OK," said Stone. "If it'slonger, the balance sheet begins to be uncomfortable."

The company's next product is CentoRx, an anti-thromboticMAb that binds to the receptors on blood platelets involved inplatelet aggregation. The drug is in Phase III trials for abruptarterial closure following coronary angioplasty, and Centocorplans to file a product licensing application by the end of theyear, said spokesman Richard Koenig.

The company also hopes to file a PLA by year end on CenTNF,its tumor necrosis factor antibody to treat gram-negative andgram-positive sepsis. It will enter Phase III trials this quarter.

Centara, to treat autoimmune diseases, is in Phase II trials forrheumatoid arthritis. Centocor hasn't decided on a leadindication, but hopes to file a PLA in 1993.

"These three products have large market potentials and couldpotentially justify the current stock price," said Joseph Edelmanof Prudential Bache.

The company has two imaging agents close to market, but thesewould generate less revenue. An FDA panel in Novemberrecommended approval of Myoscint to image dead heart tissuein heart attack patients. In December, Centocor filed forapproval of Fibriscint to image blood clots.

Existing revenues come from the company's in vitro diagnosticsbusiness, which is projected to do about $50 million in salesthis year, and from European sales of Centoxin and Myoscint.

Further down the road is Panorex to treat colorectal cancermetastases, which is in Phase II trials in Europe. Capiscint, forimaging atherosclerotic plaques, is in early trials.

-- Karen Bernstein BioWorld Staff

(c) 1997 American Health Consultants. All rights reserved.