- The Washington Times - Monday, November 29, 2004

Shares of Silver Spring biotechnology company United Therapeutics Corp. held a sizeable gain yesterday after the company received approval last week to sell a new version of its main drug.

The U.S. Food and Drug Administration gave the go-ahead for the sale an intravenous version of its front-line product, Remodulin.

Remodulin treats pulmonary arterial hypertension, a rare lung disorder with up to 3,000 new cases each year, and is administered by an injection given just under a patient’s skin.

The new IV version, delivered through an injection directly to a vein, is now available to patients who experience pain or other reactions from the original version. It will not vary in price or makeup from the older version, said Chief Financial Officer Fred Hadeed.

Matthew Kaplan, a senior biotech analyst, said he expected full approval from the FDA. “I thought they might do this or an approval letter asking minor questions. But I didn’t believe [the FDA] would require additional studies or clinical trials,” said Mr. Kaplan with New York investment bank Punk, Ziegel & Co.

Mr. Kaplan kept his “buy” rating while boosting his targeted stock price for the company from $42 to $55. He does not own any United Therapeutics stock and Punk Ziegel has no banking relationship with the company.

The company’s stock on the Nasdaq Stock Market closed yesterday at $43.95, down $1.55 from Friday’s record high of $45.05. The stock price closed at $35.57 a week ago.

United Therapeutics’ ongoing trials to develop an oral and inhaled form of Remodulin also could put the company in the forefront of the pulmonary hypertension market, said Navdeep Jaikaria, a senior biotechnology analyst at New York investment bank Rodman & Renshaw LLC.

Mr. Hadeed said the programs are in early development and had no projection for when they would be submitted for FDA approval.

“Even without those versions, there has been considerable upside for this company,” Mr. Jaikaria said, rating the company as outperforming the market. He forecast the company would make $67 million in sales this year with $15.8 million (68 cents per share) in profits.

United Therapeutics in the third quarter ended Sept. 30 had a 33 percent jump in sales to $20 million from $15 million a year earlier. The company posted profits of $6.3 million (29 cents) compared with a loss of $1.3 million (6 cents) last year.

Mr. Jaikaria does not own any company stock, and Rodman & Renshaw does no business with the company.

While some patients will initially stick with Flolan, an intravenous treatment for the same disorder by GlaxoSmithKline, analyst Lucy Lu said she expected a majority of users to switch to Remodulin’s IV version over time.

The company’s plans to have a smaller delivery pump later next year for administering the drug “will have a significant impact on the adoption of IV Remodulin,” said Ms. Lu, with New York investment bank First Albany Capital Inc.

Ms. Lu, who rated the stock as a “buy,” does not own any shares of United Therapeutics and First Albany has no banking relationship with the company.

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