Auxilium (AUXL) shares held up today ($24.85 up 0.65%) after a June 28 article questioned the valuation of the stock. Revenues for the last quarter were $45.5M primarily from its Testim testosterone gel, with a loss of $8.6M.Analysts have high expectations for a recently approved drug Xiaflex for treatment of Dupuytren’s disease and  reduce surgery for the crippling hand disease.The Barron’s article is questioning the market potential for the orphan-drug estimated in the 11M patient range.

Sales revenue  forecasted by analysts are $228M in 2010 growing to $347M in 2011. The market cap is currently at $1.2B. Terminal revenue for the drug is estimated as high as $1B in 2015.

Auxilium was a pick in the Rayno Life Science portfolio at 30 in July 2009 and reached a 52 week high of $38, so caution is in order if the Xiaflex product launch is not on track.

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