Metabasis Comeback Too Early

Metabasis Therapeutics, Inc. (MBRX) is a biopharmaceutical company that engages in the discovery and development of drugs for chronic diseases involving pathways in the liver. In July 2007, the company suffered two major setbacks when its lead drug, CS-917, failed to meet the primary endpoint in a phase IIb trial, and Schering-Plough terminated its agreement for the development of pradefovir. Both products were in mid- to late-stage trials.

The shares plummeted 54% in response to the news and the company has yet to recover from these setbacks. Although Metabasis reported positive results on core pipeline candidates, MB07803 and MB07811, we believe that investor confidence is not likely to return until the company enters into suitable partnership deals for its candidates. We maintain our Hold rating on the stock with a price target of $1.50.

Arpita Dutt contributed to this report.

Read the full analyst report on MBRX

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