J.P. Morgan Upgrades Vivus (VVUS)

J.P. Morgan Chase & Co. upgraded VIVUS, Inc.

to Overweight from Neutral, and raised its price target to $13 from $6. In a note to clients, J.P. Morgan writes, "Late Thursday night VVUS announced that the FDA issued a Complete Response Letter (

) for Qnexa, as we were expecting. All things considered, we believe this is a relatively benign CRL, although perhaps not as good as it could have been. The letter's language around cardiovascular (

) risk is the one component in particular that gives us some pause and will likely be what the bears try to hang their hats on. Nevertheless, our interpretation of the letter is that it provides a manageable path to approval in 2011, which should be enough to drive meaningful appreciation in VVUS shares over the next several quarters. As such, we are upgrading VVUS to OW and raising our 2011 PT to $13." Shares of VIVUS are up $1.87 in pre-market trading to $8.00, a gain of 30%.