UPDATE: Oppenheimer Color On CBST Upgrade

Oppenheimer, which upgraded shares of Cubist Pharmaceuticals Inc. CBST, is providing some color on the stock. “We view the recent settlement with Teva Pharmaceuticals TEVA regarding generic Cubicin as highly favorable for CBST, providing visibility into the Cubicin franchise,” Oppenheimer writes. “(2) We are encouraged by recent trends and believe Cubicin is on pace for >$1B in sales prior to generic entry in 2017/2018. (3) We believe investor focus will soon shift to CBST's pipeline, where key data in 3Q11 should yield visibility into the commercial prospects of CBST's two key pipeline assets (CXA-201 & CB-183,315). (4) According to our sum-of-the-parts based $37 PT, investors have a "free" call option on CBST's pipeline at the current valuation.” Cubist Pharmaceuticals closed Tuesday at $31.66.