UPDATE: Piper Jaffray Initiates Coverage on Cytokinetics with Overweight Rating, $4 PT

In a report published Friday, Piper Jaffray & Co. initiated coverage on Cytokinetics

with an Overweight rating and $4.00 price target. Piper Jaffray noted, “We are initiating on Cytokinetics with an Overweight rating and $4 price target. In our view, the company's platform for treating diseases by improving muscle function is under-appreciated due to its novelty. That said, the next 12 months provides investors at least two shots on goal for validating clinical data. Partner Amgen should complete the Phase IIb for omecamtiv in acute heart failure (AHF) and set the course for final testing of what could be a new class of drugs with $1B market potential. Secondly, we anticipate that positive data in the amyotropic lateral sclerosis (ALS) Phase II for wholly owned candidate tirasemtiv could lead to a partnership or buy-out in 2013. Our diligence with KOLs indicates that earlier data has predictive value for success in the ongoing AHF and ALS trials, and for the candidates' safety profiles. Our valuation includes ~$1.50/share for tirasemtiv in ALS and ~$2.50/share for omecamtiv.” Cytokinetics closed on Thursday at $0.70.