Zacks Analyst Interview Highlights: Pfizer, CoTherix and Gilead Sciences.

CHICAGO -- Zacks.com releases the latest Analyst Interview. Today's interview is with senior analyst Jason Napodano, who discusses Pfizer (NYSE: PFE), CoTherix (Nasdaq: CTRX) and Gilead Sciences (Nasdaq: GILD).

A synopsis of today's Analyst Interview is presented below. The full article can be read at http://at.zacks.com/?id=2678.

Clearly, the big news over the weekend was that Pfizer stopped production on its leading pipeline product, torcetrapib. You were even quoted in AP about it. What is your view?

We think this is devastating news for Pfizer (NYSE: PFE). We were already slightly negative on our outlook of the company, but we felt that torcetrapib was one bright spot making the stock worth holding onto. Basically, this drug extended the pipeline of the Lipitor franchise, which loses patent protection in 2010. Therefore, our top-line forecasts for 2010 and beyond are being significantly reduced.

As I said in the AP interview, it's noteworthy to remember that at the end of last month, Pfizer pulled out of its deal with Organon to develop a schizophrenia treatment called asenapine. We expected that that drug would add $500 million in sales by 2010. So that, in addition to the estimated $3 billion in total sales of torcetrapib projected for the same year, leads us to be very wary of Pfizer's long-term growth ability.

Of course, a company the size of Pfizer - the biggest of the Big Pharma group - is expected to account for its growth through cost-cutting acquisitions, or even buy out a slew of biotech companies. But such growth is very risky, expensive and highly speculative. Furthermore, Pfizer's pipeline just doesn't have another drug which offers the sales potential of torcetrapib. I just don't see it happening for Pfizer at this point, and I downgraded the shares to a Sell recommendation with a six-month target price of $20.

Earlier this year we talked about Big Pharma/Small Biotech mergers, and one of the names you mentioned was CoTherix. Looks like that turned out pretty well?

Yes, CoTherix (Nasdaq: CTRX) announced last month that they have agreed to be acquired by Swiss rival Actelion for $420 million. CoTherix markets Ventavis for pulmonary arterial hypertension (PAH), as well as having a potential big drug in mid-stage trials called Fasudil. They also have a registry program ongoing to collect information about patients with PAH. Actelion, also a big player in PAH with market leading oral drug, Tracleer, was interested in getting their hands on this data registry, as well as co-promoting Ventavis with Tracleer. PAH is a large and underserved market, but awareness and education are key to driving future growth of these products. The deal makes excellent strategic sense for both companies. This was a classic example of "team up and conquer."

There was another deal involving PAH earlier this year, right?

Yep, Gilead Sciences (Nasdaq: GILD) announced a few months ago they would acquire Myogen for $2.5 billion. Gilead, one of the largest biotechs out there, got that way by becoming the world's premier HIV/AIDS play. However, Gilead wanted to diversify and PAH offered a new opportunity for growth. Myogen is a big player in PAH already with Flolan, but could really capture big market share in the category once phase III product ambrisentan comes to market. It's all about products and the pipeline, and Gilead plucked a winner, in our view.

Read the full interview at http://at.zacks.com/?id=2647.

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