Praecis Pharmaceuticals (PRCS), a small biotech company with an approved product for treating prostate cancer, may announce sometime this year the big deal it has been waiting for, according to analysts. It could arrange a sale of Plenaxis, which has Food & Drug Administration approval for hormone-sensitive prostate cancer, to a major drugmaker. Or it may sign up a partner to market the product worldwide. Plenaxis is already on the market in Germany. Marc Lappe, managing partner at Efficacy Capital, the largest Praecis shareholder, with a 10% stake, says its initial sales results will be announced by yearend. In 2003, after Plenaxis was O.K.'d by the FDA, Praecis decided, because of a lack of funding, to sell it or find a major partner. For Praecis' Direct Select technology, which fast-screens small molecules that can target specific diseases, it has already teamed up with GlaxoSmithKline (GSK). Glaxo has bought $500,000 worth of stock, or 1%, to use Direct Select in speeding up its drugmaking. Gilead Sciences (GILD) is also using the technology. Rahul Jasuja of MDB Capital Group rates the stock, now at 4.41, a "buy" with a 12-month target of 9.
Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.
Corrections and Clarifications
"Will Praecis announce a lucrative deal?" (Inside Wall Street, May 15) stated that Praecis Pharmaceuticals' Plenaxis is on the market in Germany. It has been approved, but Praecis has no plans to market it there.
By Gene G. Marcial