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Intercept Pharma Gets Dueling Initiation Reports As FDA Panel Nears

Shares of biotech Intercept Pharmaceuticals ( ICPT ) were up in twice-average volume Wednesday, after two analysts launched coverage ahead of a crucial FDA panel vote. Credit Suisse’s Alethia Young initiated with a buy rating, while Salveen Richter at Goldman Sachs initiated with a neutral rating, though they agreed on the general outlines of the investment thesis. Intercept’s lead drug candidate, obeticholic acid (OCA), is up for an FDA advisory committee discussion on April 7 as a treatment for primary biliary cholangitis (PBC), a rare, chronic liver disease. If approved by the FDA’s May 29 deadline, it would be Intercept’s first commercial product. Young estimates that annual sales for obeticholic acid could hit $259 million in 2018, though Richter forecasts it at only $170 million at peak. Both analysts, however, agree that the really big potential market for OCA is in nonalcoholic steatohepatitis (NASH), a much more common liver disease without a current treatment. That could draw $3.5 billion a year, Richter estimates, but that’s a ways in the future: The next batch of data from the NASH clinical trial isn’t expected until 2018. Between the panel meeting and the NASH data, Richter sees “a dearth of catalysts” to drive Intercept’s stock, leading him to set his price target at 114. Young, however, says approval and launch for treatment of PBC, both in the U.S. and Europe, could provide more upside for the stock. Her peak sales estimate in NASH is almost twice Richter’s at $6.5 billion. She set her price target at 200. Intercept stock rose 5% in early trading on the stock market today , but by early afternoon it was up 1%, near 125.50. Shares hit a 19-month high above 314 last May.

Like Apple, Google Android Said Ordered To Unlock Smartphones

Apple ( AAPL ) isn’t the only tech giant to face government demands to unlock cellphones. Alphabet ( GOOGL ) unit Google reportedly has been ordered to help federal agents open cellphones in seven states. The American Civil Liberties Union found 63 instances stretching back to 2008 where the government sought a court order to help it access data from a locked cellphone, the Wall Street Journal reported Wednesday. Apple’s first iPhone was released in mid-2007. Details of the cases came after the U.S. Department of Justice on Monday told a federal judge that it no longer needed to compel Apple to help unlock  the password-protected iPhone 5C used by Syed Farook, one of the two now-deceased shooters in the San Bernardino, Calif., massacre. The DOJ said the FBI was able to access data on the iPhone with the assistance of an unidentified outside party, without Apple’s help. Apple had argued that a court order forcing it to write software to bypass its own security protections would have set a dangerous precedent. Creating a “back door” for the government’s use would have made all iPhones more vulnerable to hackers, criminals and spies, the company said. Google told the WSJ: “We carefully scrutinize subpoenas and court orders to make sure they meet both the letter and spirit of the law. However, we’ve never received an All Writs Act order like the one Apple recently fought that demands we build new tools that actively compromise our products’ security. … We would strongly object to such an order.” Google is among the many tech companies that have backed Apple in its fight with the FBI. The ACLU, though, says the All Writs Act was used in the Google cases, which involve investigations by the FBI, Secret Service, Homeland Security Department, Drug Enforcement Administration and Bureau of Land Management, the WSJ said. Prosecutors have sought to use the All Writs Act, a law from the 18 th  century, to compel the smartphone makers to allow access to data, unleashing a massive privacy debate. The first cases relying on the All Writs Act date back to 2008. In one of the Google cases, a 2015 drug investigation in California, prosecutors got a court order compelling Google to provide assistance in getting data from an Alcatel and a Kyocera cellphone, that used Google’s Android operating system, the WSJ said, citing court records. The ACLU found Google was also the subject of All Writs Act cases in Alabama, New Mexico, North Carolina, North Dakota, Oregon and South Dakota, according to the report. A court filing last month from Apple indicated there were about a dozen cases in which the Justice Department was pursuing similar orders involving Apple iPhones. Google’s Android is an open source operating system that runs on phones manufactured by a number of companies, while Apple’s iOS is used just on its iPhones. Apple stock was up 1% in early afternoon trading in the stock market today , near 109. Alphabet stock was up a fraction, near 771.  

Allscripts Lands A Deal; Cerner Faces Security Challenge At MedStar

Allscripts Healthcare Solutions ( MDRX ) stock jumped again Wednesday, with Wall Street “extremely encouraged” by a deal to extend Allscripts’ information tech to University Hospitals in northeast Ohio through 2024. Meanwhile, Allscripts’ No. 1 rival  Cerner ( CERN ) was likely trying to help its Baltimore-based customer MedStar, after an apparent virus infected MedStar’s computers. The hospital chain — said to be the the largest civilian health care organization in the Washington, D.C., area — shut down its entire network “to prevent virus spread,” MedStar tweeted Tuesday. “We have no evidence of compromised information. All facilities remain open.” Wednesday morning, MedStar posted to Facebook: “Thanks to our IT and Cyber teams, our analysis continues to show no patient or associate data have been compromised. All major clinical systems are working toward full restoration.” Departing MedStar nurses, meanwhile, told CBS News that staff was delivering care using paper records. Cerner and MedStar entered into a seven-year IT deal in October 2014. Cerner didn’t immediately respond to requests for comment. Allscripts stock rose as much as 4.6% in the stock market today  after rising 5.4% on Tuesday, and was up about 2%, above 13, midday Wednesday. Cerner stock was up a fraction midday Wednesday, 30% off a record high touched nearly a year ago. Allscripts Platforms Headed To Five More Hospitals Allscripts didn’t specify the value of the agreement announced Tuesday after the close, but it has already deployed its Sunrise Clinical Manager platform in nine University Hospitals in and around Cleveland. The deal calls for five more Sunrise platforms to be installed in five hospitals recently acquired by UH. The hospital chain will also increase use of Allscripts’ database software, called dbMotion, Allscripts said in its announcement. “Because dbMotion harmonizes information from disparate clinical systems and brings actionable data to the point of care, UH will be positioned to more effectively coordinate care across settings,” Allscripts said. Canaccord Genuity analyst Richard Close reiterated a buy rating on Allscripts stock, with an 18 price target. In a research note, he said he was “extremely encouraged by today’s announcement, which echos our view that MDRX continues to improve its competitive position. “MDRX’s investor meeting held during the (Las Vegas Healthcare Information and Management Systems Society) conference (ended March 4) provided confidence that existing customers were satisfied with MDRX and looking to continue and expand their relationship,” Close wrote. University Hospitals’ 18 hospitals include Cleveland’s Case Medical Center, the academic hospital of Case Western Reserve University. “This large extension of (Allscripts’) footprint at University Hospitals is an additional proof statement of Allscripts’ return to competitiveness in the enterprise systems market, as this contract extension was a competitive bid against established competitors in the market,” wrote RBC Capital Markets analyst David Francis in a Wednesday research note. RBC maintains an outperform rating on Allscripts stock, with a 17 price target. MedStar Virus Raises Worries Regarding the MedStar computer virus in Baltimore and Washington, Rachel Ehrenfeld, CEO of the American Center for Democracy and the Economic Warfare Institute, told IBD via email that “while physical security is important, the damage caused by hacking into a hospital IT could cause short- and long-term horrendous damages. “If the system is secure and functioning, it could possibly prevent or limit the scope of a physical attack.” In its October 2014 MedStar announcement, Cerner said it would “develop technologies that align with MedStar’s vision to be the trusted leader in caring for people and advancing health. The new alignment will allow access to all Cerner solutions and services throughout MedStar’s 10 hospitals and 3,000-plus beds, as well as the ambulatory and post-acute network. Cerner will provide MedStar an expanded enterprise Electronic Health Record (EHR) that will provide clinicians seamless access to patient information across the continuum of care.” Image provided by Shutterstock .