Piper Jaffray Reiterates Overweight Rating On Salix Pharmaceuticals
According to Piper Jaffray, Salix Pharmaceuticals (NASDAQ: SLXP) shares reflect minimal expectations for Xifaxan550 in irritable bowel syndrome (IBS) ahead of the 6/20/11 FDA meeting to explore a path forward.
Piper Jaffray said that an outcome involving SLXP running a non-randomized study would be a low/moderate-risk path forward and a positive for the shares in our view. “We also believe that SLXP walking away from running a large, randomized study would not necessarily be a negative given that there could be greater pricing power for Xifaxan550 with a narrower label in hepatic encephalopathy (HE), bearing in mind the compelling pharmaco-economic benefits of the drug in this setting. SLXP will provide an update on the path forward on its 2Q call. Even without IBS, we believe SLXP represents one of the most attractive growth stories in specialty pharma. We reiterate our Overweight rating and $47 PT.”
Salix Pharmaceuticals closed on Friday at $35.84.
