undervalued

Downgraded by Merriman Curhan Ford from Buy to Neutral

From Barron's 6-18-07:

Buy - Price 8.16 on June 12
by Merriman Curhan Ford & Co.
COLY announced the acquisition of clinical and late preclinical-stage compounds from 3M Pharmaceuticals [recently].Drivers that we believe can provide potential upside for investors in the next year include data from Pfizer's two Phase III clinical trials of PF-3512676 for non-small cell lung cancer, an increased clinical commitment by Pfizer for Coley's compound (PF-3512676) in new cancer indications, and advancement of preclinical drug compounds...Reiterate Buy. In our view, Coley should provide additional upside for investors because of a strong partnered late-stage clinical oncology program, a strengthened pipeline, and potential revenue generation. Data from Pfizer's non-small-cell lung cancer Phase III clinical trials can be expected in late 2007 or early 2008. Market cap: $218 million. Risks: In the biotechnology space, there is always a risk that other companies or universities may have filed or been granted patents [for] technologies similar to [those] used by Coley. Note: there have been patent disputes between Coley and Dynavax.

A Director of the company has recently purchased 160,000 shares or $1,387,600 worth of stock.

Good drug pipeline and potential takeover target by Pfizer

Thought their product has a stong potential longterm

Short