Needham upgraded Encysive Pharmaceuticals (ENCY) to buy from hold.
Analyst Mark Monane says he favors a newly formed plan for the company going forward, including its focus on sitaxsentan, the recent reacquisition of rights for sitaxsentan from ICOS Pharmaceuticals, FDA issuance of Special Protocol Assessment for the STRIDE II trial, and the firm's leadership under Bruce Given.
He believes the current valuation doesn't reflect the market potential of sitaxsentan, Encysive's lead drug candidate for pulmonary arterial hypertension. If the current trial is successful, Monane says he expects sitaxsentan to hit the marketplace in early 2006, and generate peak sales of $300 million to $400 million. He set a $9 target.