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Cowen is yet again out positive on Nektar Therapeutics (NASDAQ:NKTR) noting that at the American Diabetes Association meetings (June 22-26), Pfizer reps demonstrated Exubera to all who would listen, rolled out the print advertising campaign, and revealed that the long-awaited DTC television ads would hit the U.S. market next month.

Yet NKTR shares sunk to a three-year-low on concerns that Pfizer may pull the plug on its Exubera support. Firm's checks at the meetings indicate those concerns are misplaced. They believe Pfizer will run the DTC program for at least 9-12 months to drive patient demand, and all of clinical consultants (whether bullish or bearish on Exubera) believe that DTC advertising will have a significant positive impact on Exubera use. With Exubera expectations virtually eliminated from the share valuation in firm's view, clinician sentiment beginning to turn, the DTC advertising catalyst coming in Q3, and visibility on Nektar's internal pipeline rising in Q4, they believe NKTR shares can outperform the market by 30%+ over the next 6-12 months.

Early prescription trends for Exubera have been disappointing, due to a deliberate launch by Pfizer and low patient awareness. However, the firm believes that patient dissatisfaction with current diabetes therapies has created pent-up demand for Exubera, and will drive accelerating use as Pfizer's primary care launch gains traction in H2:07 and direct-to-consumer advertising begins this summer. Recent clinical checks indicate high patient satisfaction with Exubera and, in many cases, an improvement in glucose control over injections.

Notablecalls: Last time I was positive on NKTR, the stock took out my stops in a heartbeat. Not only that, it took another 15% dive over the following weeks. The shorts sure like to chop this one down.

Yet Cowen's comments make too much sense not to be highlighted. Not calling it actionable here, though.

Source: Cowen Sees Nektar Outperforming Market By 30%+