Synergen stock plunged $7.13 on Monday to $59.88 following a"sell" recommendation from a Merrill Lynch analyst andcautionary remarks about the entire biotech sector from aMorgan Stanley analyst.
Merrill Lynch's Stuart Weisbrod touched off sales of Synergen(NASDAQ:SYGN) when he lowered his rating to sell from"neutral" and put a share value of $30 to $47 on the Boulder,Colo., company, which closed Friday at $67.
The market also heard a gloomy prediction for the wholesector from Michael Sorell of Morgan Stanley. "It's time to takesome money off the table," Sorell said. "Some secondary nameshave gotten ahead of themselves, and as a result the wholegroup is vulnerable."
Among NASDAQ stocks that suffered were Chiron Corp. (CHIR),down $3.50 to $69; Biogen Inc. (BGEN), which fell $3.38 to$32.75; and Centocor (CNTO), dropping $3.25 to $52. SomatogenInc. (SMTG) lost $2.63 to end at $34.63; CaliforniaBiotechnology (CBIO) was off $2.75 to $20.25; Genzyme Corp.(GENZ) dropped $2.50 to $47.50; and Isis Pharmaceuticals(ISIS) lost $2 to close at $16.
Weisbrod predicted that Synergen's lead compound, Antril IL-1ra, would enter the market for sepsis drugs behind thecompetition and would garner only 15 percent of that marketby 1995.
Other indications for Antril as an anti-inflammatory werespeculative, according to Weisbrod, because of its short half-life and relatively weaker potency when compared withcompetition from Immunex Corp.'s soluble IL-1 receptor andPfizer Inc.'s Tenidap, an oral anti-inflammatory.
He also warned that Antril could share claims with another IL-1 inhibitor whose patent application is held by Biogen.
Alex. Brown & Sons analyst David Webber disagreed and toldBioWorld that "an excellent buying opportunity has beencreated by today's decline in the stock price." Webber's six- to12-month price target for Synergen is $75.
Webber said Weisbrod's sepsis market share prediction forAntril "misses an important point -- that there is probably nosingle sepsis drug which will do the trick. A cocktail approachseems to be the optimal therapeutic strategy."
Webber also predicted that if a competing patent were issuedto Biogen, it probably will not cover Antril.
For other indications, Webber said the cost of the Immunexdrug might offset the higher dosage required by Antril, andsuggested that Pfizer's Tenidap and Antril might havecomplementary roles against rheumatoid arthritis.
-- Steve Usdin BioWorld Washington Bureau
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