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ViroPharma Up on Takeover Rumors

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Shares of ViroPharma Inc. recently jumped 6.30% on potential buyout rumors.

As per Reuters, several pharmaceutical companies have shown an interest in acquiring ViroPharma given the company’s orphan disease drug portfolio.

The company’s key drugs include Cinryze for hereditary angioedema (HAE), Plenadren for the treatment of adrenal insufficiency (AI), Buccolam in Europe for the treatment of pediatric seizures, and Vancocin for the treatment of C. difficile- associated diarrhea (CDAD).

We note that ViroPharma’s growth story currently revolves around Cinryze, which is approved in the US for routine prophylaxis against angioedema attacks in adolescent and adult patients with HAE. Cinryze accounted for 76% of total sales in 2012.

In the EU, Cinryze received approval for routine prevention, pre-procedure prevention and acute treatment of angioedema attacks in adults and adolescents in 2011.

Cinrzye has been granted marketing exclusivity by the FDA until 2015 under the Orphan Drug Act.

ViroPharma has begun commercializing Buccolam in Europe paving the way for an additional revenue opportunity.

Additionally, the acquisition of Plenadren in 2011 expanded the company’s orphan disease commercial product portfolio although the approval process for Plenadren hit a roadblock when the FDA informed the company that the data filed by it in the EU regarding Plenadren was not sufficient for evaluating the risk/benefit profile of the drug in the US.

Meanwhile, an interesting candidate in ViroPharma’s pipeline is maribavir which is being developed for the treatment of cytomegalovirus (CMV) infections in transplant recipients.

ViroPharma recently received ‘orphan drug designation’ in the EU for maribavir for the treatment of CMV in patients suffering from impaired cell mediated immunity.

Maribavir was granted the same designation in the US in May 2011 for the treatment of clinically significant CMV and disease in at-risk patients.

We expect investor focus to remain on takeover updates. Shares have gone up 5.4% on a year-to-date basis and we expect further increase if the buyout rumors gather momentum.

ViroPharma currently carries a Zacks Rank #3 (Hold). Right now, Salix Pharmaceuticals , Santarus, Inc. and Jazz Pharmaceuticals (JAZZ - Free Report) look attractive with a Zacks Rank #1 (Strong Buy).

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