) (ANDS) is not a stock for people who like to sleep easy. It soared 43% in the past year, to a peak of 16.60 in March. Since then, it has slumped to 9.46 -- and is down 8.4% so far this year. Still, that's pretty respectable in a terrible year for biotechs. What's more, some analysts think Anadys' drubbing has been overdone, and they're betting on a rebound. By summer's end, they expect the San Diego company to report favorable results from early trials of an oral drug for chronic hepatitis C virus and perhaps other diseases such as hepatitis B. Anadys has a global partnership with Novartis (NVS
) for the Swiss giant to develop, manufacture, and sell the drug, which could make waves in the $3 billion hepatitis C market. "This is a very good company with very good science," says Eric Schmidt of Cowen. "If those data are as good as we hope, the stock might be a two- or three-bagger." Getting there is likely to be a nail-biter. Schmidt expects more losses like those in the first quarter, when the company bled $5.8 million (vs. $8.4 million for first quarter of 2005). Soham Pandya of Susquehanna Financial Group rates the stock a "buy." He argues that "earnings are not material" because Anadys will "incur operating losses as it funds R&D." It has a strong pipeline of new drugs, with about 45 issued patents and 92 pending worldwide.Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them. Gene Marcial is on vacation.