Biogen-Idec (NASDAQ:BIIB) is getting some cautious commentary after the co reported another case of PML in Ex-U.S.,confirmed June 23, 2009. This is the 10th confirmed PML case since Tysabri was relaunched in July 2006. This patient had received 30 doses of Tysabri therapy.

- Deutsche Bank is downgrading BIIB shares from Buy to Hold, as they believe the shares are now fairly valued. Firm notes that when they upgraded, they argued that at about $42/ share BIIB shares were pricing in an overly pessimistic Tysabri scenario (i.e. that it would decline dramatically or even be pulled from the market). Tysabri, however, continued to grow. In their opinion, the stock is now pricing in reasonable Tysabri expectations and no longer warrants being one of firm`s "top picks" in 2009.

Longer term (1-2 years), BIIB remains one of Deutche`s favorite names. They still believe the Street has dramatically underestimated the company's EPS leverage (industry high R&D spending should come down ~7% as a % of revenue over the next 5 years). In addition, BIIB has 7 drugs in ph 3, for which the stock reflects little -- if any -- value. Shorter term, they think upside could be driven by wise use of cash. They continue to hope BIIB will use at least some of its cash to buy stock back (similar to 2007's "Dutch Tender") and/or complete a smart acquisition in the neuro or cancer fields.

- Jefferies notes that with emerging PML cases with Tysabri use (particularly in ex-U.S., where incidence is >4x higher vs. U.S.), they view increased adoption of drug holiday as strong possibility. BIIB trades below peers (~15-20% discount); however, they believe significant upside potential to current levels may be limited, except for take-out speculation. Maintains Hold and $53 tgt.

- Morgan Stanley says the new PML case supports thesis of increasing risk.

Impact on firm views: In support of the thesis that PML risk (rare brain infection associated with Tysabri use) is increasing with longer treatment duration, Biogen Idec announced on Friday its 10th case of PML following re-launch of Tysabri (June 2006; 13 including clinical trial set) and importantly, the 6th case in patients treated with drug for longer than 24 months. With this new case, the WW PML risk is ~1/1000 in patients treated for >24 months, and by firm`s estimations at least 1/500 ex-US in this patient population. They continue to believe the risk of PML is evolving and expect the rate to increase past the three year anniversary of Tysabri’s re-launch (although company has indicated plans to stop weekly reporting of cases in July) posing risk to the bull thesis of Tysabri re-acceleration and almost all forward Street estimates.

Maintains Underweight and $44 tgt.

Notablecalls: PML is nothing new but it kind of looks like the shares have found a glass ceiling. Looks like down is the path of least resistance for the time being.

No posititive catalysts around (barring a takeover)

I would not be surprised to see the stock down 1-1.5 pts following these comments.