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Viropharma: 2013 Cinrzye Outlook Encouraging, Potentially Conservative

 January 08, 2013 02:19 PM

(By Mani) ViroPharma Inc. (NASDAQ: VPHM) has provided an update on fourth-quarter Cinryze sales and laid out encouraging 2013 guidance, which may prove to be conservative.

The company sees total sales for 2013 in the range of about $450 million to $475 million suggest potential upside to the market estimate of about $450 million, implying higher than previously expected Buccolam and Plenadren sales. Wall Street expects sales of $466.7 million, according to analysts polled by Thomson Reuters.

Exton, Pennsylvania-based ViroPharma's key product Cinryze is an injectable medicine that is used to help prevent swelling and/or painful attacks in teenagers and adults with Hereditary Angioedema (HAE) – a rare hereditary disorder in the immune system causing swelling, particularly of the face and airways, and abdominal cramping.

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In the U.S., the company sees 2013 Cinryze sales of $390 million to $400 million versus the consensus of $399 million. The expectations may be conservative since $400 million implies only about 1,100 patients on the drug at the end of 2013 and there were 60-85 gross new patient adds per quarter during 2012.

"Importantly, we see potential for upside to our 2013 estimates on acceleration of new patient starts given the lack of potential supply constraints which existed in 2012," Oppenheimer analyst Christopher Holterhoff said in a client note.

Currently, Cinryze has an unaudited 2012 U.S. net sales of approximately $321 million, driven by over 900 active patients on prophylactic therapy. Of sales, about $311 million to $312 million represents actual patient demand, and the remainder represents increase in channel inventories. The company also anticipates that the remaining channel inventory increase to complete return to normalized levels will occur in the first quarter of 2013.

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"We also expect VPHM to present updated Maribavir data (omitted from estimates but represents ~ $300M in potential peak sales) that may serve as a positive catalyst," Holterhoff said.

ViroPharma is expected to continue adding patients on to Cinryze therapy on a consistent basis going forward as they have done in recent quarters. Additionally, the newly established HAE treatment guidelines encourage more limited use of first-line steroids, which should have a positive impact on Cinryze growth.

Moreover, there appears to be limited competition on the horizon, lending solidity to the drug's long-term sales prospects.

In addition, Buccolam and Plenadren in Europe have the potential to become strong contributors to the company's overall growth in the years ahead. Buccolam is approved for the treatment of prolonged acute convulsive seizures in children aged between 3 months and 18 years of age while Plenadren is used to treat adrenal insufficiency.

"We see potential upside for Buccolam/Plenadren franchise sales, given $450-475M guidance for net product sales and our current $460M total revenue estimate. We expect linear growth in 2013 for both Buccolam and Plenadren," Holterhoff added.



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