It is hard to decide whether it was the unexpected positive results from Salix Pharmaceuticals' lead drug Xifaxan (rifaximin) in the new indication of non-constipation irritable bowl syndrome (non-C IBS), or the fact that the company was put forward as a potential takeover target for Forest Laboratories, that caused its shares to rise an impressive 49% last week, touching an almost four-year high of $20.22 on Wednesday.
While the takeover speculation may have less substance, the non-C IBS data was not only very solid but firmly caught analysts on the hop. A Cinderella-like indication, many had largely disregarded the drug in non-C IBS, focusing their attention instead on the drug’s potential in hepatic encephalopathy (HE). But with the share price rising so much on the news, analysts are almost certain to be scrabbling around to upgrade forecasts for the drug that are currently sitting at $198m for 2014.
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