Still Neutral On Ardea BiosciencesZacks Investmentupdated Apr 04, 2012TweetAt GET.com we maintain complete editorial integrity on our content & provide transparent & unbiased information. Companies don't pay us to include their products although we receive a compensation when you successfully apply to products from our partners. See how we make money here.At GET.com we maintain complete editorial integrity.We are maintaining our Neutral recommendation on Ardea Biosciences Inc. (RDEA) with a target price of $23.00. Ardea Biosciences, headquartered in San Diego, California, focuses on the discovery and development of small-molecule therapeutics for the treatment of gout and cancer. Last month, Ardea reported fourth quarter and full year 2011 results. Ardea’s fourth quarter net loss of $1.15 per share exceeded the year-ago loss of 3 cents and the Zacks Consensus loss Estimate of 87 cents. The wider loss was attributable to lower revenues and higher operating costs recorded in the quarter. (Read our full coverage on this earnings report: Ardea Posts Lower Revs, Wider Loss). We are pleased with Ardea’s efforts to develop its lead candidate lesinurad for the treatment of hyperuricemia (elevated uric acid levels) and gout. The incidence and severity of gout is increasing in the US. Lesinurad will target a market with a huge unmet need on approval. This should boost the company’s top line significantly. Furthermore, the lucrative agreement with Bayer (BAYRY), signed in 2009, focusing on the development of MEK (methyl ethyl ketone) inhibitors for the treatment of cancer is another positive for Ardea. However, we remain concerned about the early stage development status of the pipeline apart from lesinurad. Moreover, the competition awaiting Ardea’s candidates on approval is another concern. For example, lesinurad on approval will face significant competition in the gout market, which currently has players such as Takeda’s Uloric and Savient Pharmaceuticals’ (SVNT) Krystexxa. Moreover, companies such as Regeneron Pharmaceuticals (REGN) are developing therapies for gout. This could make it challenging for lesinurad to gain share once launched. We see limited upside from current levels and maintain our long-term Neutral stance on the stock. BAYER A G -ADR (BAYRY): Free Stock Analysis Report To read this article on Zacks.com click here. Editorial Disclosure: Any personal views and opinions expressed by the author in this article are the author's own and do not necessarily reflect the viewpoint of GET.com. The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the companies mentioned, and have not been reviewed, approved or otherwise endorsed by any of these entities.