DECEMBER 19 - WELLS FARGO INITIATES OUTPERFORM $8-10
Wells Fargo initiates coverage on Sunesis Pharmaceuticals Inc. (NASDAQ: SNSS) with a Outperform rating and $8-$10 valuation range.
The firm comments, "Sunesis' lead compound, vosaroxin, is a novel quinolone derivative in development for relapsed/refractory acute myeloid leukemia (R/R AML). In September 2012 the ongoing vosaroxin Phase III VALOR study passed a major clinical de-risking event, in our view, when the data safety monitoring board (DSMB) recommended VALOR continue to conclusion based on a promising overall survival (OS) signal. Based on our review of vosaroxin and other AML drugs' clinical data, VALOR's statistical assumptions, and expansion of the study's size, we believe VALOR is more likely than not to succeed on its primary endpoint, creating a major potential value inflection for SNSS. During 2013, a final safety analysis and vosaroxin efficacy updates in an elderly front-line study could provide catalysts for SNSS shares ahead of VALOR results in H1 2014E. With a ~$150 million enterprise value and vosaroxin's long-term potential in R/R AML, we believe SNSS is undervalued and see risk/reward as favorable going into VALOR data."
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Shares of Sunesis Pharmaceuticals Inc. closed at $4.15 yesterday, with a 52 week range of $1.14-$6.85.