First Albany Keeps Buy on OSI Pharmaceuticals

First Albany keeps the buy rating on OSI Pharmaceuticals (OSIP

).

Analyst David Webber says he's reiterating the buy rating based on a successful Phase III trial of Tarceva for front-line therapy of pancreatic cancer, in which Tarceva raised the overall survival rate in patients by 23.5%. He says the positive outcome is a surprise, as OSI and partner Genentech warned that the study had a high risk of failure.

Webber says, considering the poor prognosis in pancreatic cancer, he expects Tarceva for pancreatic cancer to begin off-label use after it reaches the market, with approval for nonsmall-cell lung cancer expected by February, 2005. He upped the $63 target to $77, based on the new fiscal 2008 (Sept.) earnings per share estimate of $3.66.