After a marginal appreciation in the share price of bio-medical company ISIS Pharmaceuticals Inc. (ISIS), Zacks senior bio-medical analyst Jason Napodano, CFA, reiterates his Buy rating on the shares.  The following excerpts explain his position:

We are reiterating our Buy rating on Isis Pharmaceuticals and increasing our price target to $17. We believe that antisense technology represents an exciting and potentially revolutionary platform for developing therapeutic candidates to treat a wide range of diseases. In our view, antisense as a platform is today where biologics were ten years ago. Our financial model forecasts profitability in 2010.

Although it is still at an early stage, antisense technology as a platform for developing drugs reminds us greatly of the promise of biologic drugs over a decade ago. Potential mechanisms such as siRNA, RNAi, alternate splicing, and micro RNA have the potential to change how we treat disease in the years to come.

Isis exited the second quarter in 2007 with cash and equivalents of $202.7 million. We note this does not yet include the $26.5 million from Alnylam or the $45 million from Ortho McNeil. As part of the Ortho McNeil transaction, Isis will repurchase the equity in Symphony GenIsis, Inc. Operating burn for the full year 2007 should be around $45 million based on our financial model.

We currently forecast well over $200 million still on the books at the end of the year. Our $17 target is derived by discounting our 2011 EPS of $1.55 back to present day at 20% using a 25x multiple.