LOS ANGELES, CA -- (Marketwire) -- 01/31/13 -- Immediately after Tekmira (NASDAQ: TKMR) (TSX: TKM) announced that it had settled litigation between it and Alnylam Pharmaceuticals, Byron Capital analyst Douglas Loe maintained his SPECULATIVE BUY rating on the company, but raised his price target on shares a full $5 to $12.50.
That was only a couple of months ago, but shares are still trading under $5. This despite the fact that Tekmira announced finance.yahoo.com%2fnews%2ftiny-tekmira-lands-65m-settlement-124603532.html">it would receive $65-million (within ten days) as part of that settlement and is eligible to receive $10-million in near-term milestone payments in 2013, biotech traders seem to have either lost sight or interest in the stock. Meanwhile, even some of the well trained eyes we spoke to recently said at first glance: "It looks like they are going to need to do a raise, doesn't it? They must be running out of money."
In fact, thanks to the hefty lawsuit settlement, Tekmira's cash runway now extends into 2015 and management at the firm is excited about plans to aggressively advance multiple products into human clinical trials.
"TKM (is) Trading at Levels Ascribing Virtually No Value to Well-Advanced siRNA Pipeline," wrote Loe in a note to clients. "The capital markets are ascribing little value to Tekmira's siRNA pipeline, which has advanced well beyond the proof-of-concept stage and has already performed well in several human or non-human primate studies, greatly reducing development risk not only to siRNA and to LNP, but to the drug candidates to which clinical data apply."
The entire RNAi drug development space is now at critical inflection point and the fact that Alnylam Pharmaceuticals is using the this particular platform as a key component adds validation to Tekmira's lipid nanoparticle (LNP) delivery technology -- which acts as a delivery mechanism for RNAi therapies. Dirk Haussecker, who arguably runs the most credible and up to date RNAi information sites on the planet, recently opined that "2012 was the most exciting year in the ~12-year history of RNAi Therapeutics -- both from a scientific and financial perspective... With the start of 2013, the industry is looking to build on these successes with additional clinical trial results, interesting new therapeutic candidates and product specific and platform-related deals, particularly in the area of delivery. With appetite for innovation increasing in a low interest rate economy and with the orphan drug tsunami, 2013 could be a quite rewarding year for the discerning investor."
A bullish nod comes from the JP Morgan Healthcare conference which wrapped up a couple of weeks ago. This is the largest conference for the industry featuring endless companies getting news out and doing whatever they can to get attention. It's apparent that ALNY caught attention unlike the others. After their presentation at break-out meetings, where information flow borders on offside, they must have spoken about upcoming partnering deals of great magnitude and/or that they expect strong data. Using that momentum, Alnylam announced a public offering of 8 million shares at $20.13 a share on Jan. 14. After an overallotment of another $1.2 million a week later, the company raised a total of $173 million.
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