Biotech Implosion: CV Therapeutics (CVTX)

CV Therapeutics (CVTX) just showed Ranexa study for chronic chest pain (angina) that aren’t what investors were hoping for.  The Phase III clinical trial studying the drug for other uses as a treatment of coronary syndromes did not meet its primary study goal for effectiveness for "FIRST-LINE" treatment, but it is already approved for second-line treatment for chronic angina.  Here is the issue: But the "safety" results gathered from the study could support expansion of the drug into a first-line treatment.  Full results will be released March 27 at the American College of Cardiology Scientific Session in New Orleans.

Shares of CVTX were up $0.10 to $12.30 in regular trading, but shares are now down 27% at $8.92 in after-hours trading.  This will mark a 52-week low if this level holds.  THe 52-week range is $9.45 to $25.36 and the company still loses money.  Before this the company has street EPS projections of -$3.30 for 2007 and -$1.65 for 2008.

As of the $12.30 closing price it had a market cap of about $730 million and had cash and equivalents of more than $300 million.  Total assets are $421 million but total liabilities after a $399.5 million long-term debt come out to $467 million.

Jon C. Ogg
March 6, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.