COR: Biotech Bait?

Is COR Therapeutics (CORR ) buyout-bound? As with other biotechs, shares of COR, a highflier last year, have dropped precipitously. The stock fell from 43 early this year to 18 on Oct. 8, before edging up to 20 on Oct. 17. Never mind that COR has started making money on its chief product, Integrilin, an anti-clotting drug for heart patients. This is one reason some analysts have remained bullish--despite COR's warning on Oct. 3 that sales for the third quarter and all of 2001 would fall below estimates--a result of the general post-September 11 downturn.

Analyst Mark Monane of New York investment firm Needham--who rates the stock a buy, with a 12-month price target of 42--terms the sales drop a "hiccup." He expects "dramatically higher" Integrilin sales in the fourth quarter and 2001 total sales of more than $240 million, up from last year's $104 million. Integrilin, which Schering-Plough (SGP ) also markets, has a market share of 51%. Monane figures COR will earn 30 cents a share in 2001 and 93 cents in 2002.

John McCamant, editor of the Medical Technology Stock Letter, views any weakness in the stock as an "attractive buying opportunity." He thinks COR is a potential takeover target because of the sharp drop in the stock and the huge potential of Integrilin and other products still in clinical trials, such as Cromafiban, an oral form of Integrilin. "COR has all the right stuff for the likes of a Pfizer (PFE ) or Genentech (DNA ) to want to buy it," says McCamant. He says CEO Vaughn Kailian is intent on building COR into a leading biotech, "but I don't doubt that several big drugmakers are eyeing COR" as a possible target. "In tough markets, selling becomes an important option," says McCamant. At the right price, he says, "Vaughn might get tempted" to do a deal. COR is "well worth north of 40 in a buyout," says McCamant.

By Gene G. Marcial

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