Boston, MA 05/19/2014 (wallstreetpr) – Biotechnology giant, InterMune Inc. (NASDAQ: ITMN), is up in early trading session as investors continue to remain optimistic that the company’s lung disease drug, pirfenidone, might finally get the much needed FDA approval. The company’s stock is already up by 15.01% to 39.46 with the submission for approval of the drug expected to be made in the next few weeks. There is optimism that successful approval will result in the drug being available to the market as early as the first quarter of 2015, according to a regulatory filing.
Pirfenidone Approved in Europe as Esbriet
The drug is already approved in Europe going by the name Esbriet and used to treat idiopathic pulmonary fibrosis, a form of lung scarring disease that has no known cure. The drug received its major setback in 2010 after it was denied approval by regulators in the U.S on recommendations for further trials to try and find out its effectiveness.
Pirfenidone in the latest tests showed significant progress in reducing progression of the lung disease according to a filling in New England Journal of Medicine. The disease has been known over the years to cause tissues deep in the lungs to be extremely thick and stiff. This results in a major deterrence to the flow of oxygen into the blood stream.
InterMune Rated as a “Buy”
The positive news on the trials has already seen InterMune Inc. (NASDAQ:ITMN)’s stock upgraded by analysts at Stifel Nicolaus, who have increased their share price target from $45 to $51, with a “buy” rating. The company’s stock now commands a consensus buy rating with a share price target of $38.
Analysts at TheStreet research firm on their part maintain a “Sell’ Rating is pointing a number of strengths and weaknesses behind the ratings. InterMune net income has depreciated by 7.6% compared to the same quarter in 2013, dropping from $53.65 million to $49.88. A debt to equity ratio of 0.69, is slightly high, highlighting the need for better debt management strategies.
InterMune Inc. (NASDAQ:ITMN) weaknesses in the market are, on the other hand, offset by a high gross profit margin of 88.88% which has considerably increased sequentially. Its shares have also risen by 259.32% over the past year.
