RBC Capital Markets on Thursday upgraded Vertex Pharmaceuticals (VRTX) to Outperform from Sector Perform, arguing that the Boston, Massachusetts-based biotech is poised to record upside in 2026 on the back of a cystic fibrosis franchise that remains robust.
Analyst Brian Abrahams argued that Vertex’s (VRTX) CF franchise, which is expected to generate $12.5B - $13.5B in sales for over a decade, is worth nearly $400 per share net of cash, “suggesting to us the current stock price is no longer baking in overexuberant pipeline assumptions.”
“CF platform remains among healthiest core franchises of any large-cap biotech,” Abrahams wrote, as he raised his target price on VRTX to $546 from $455 per share. He based his estimates on a lack of competition or any notable signs of pricing pressures, as well as healthy and rising margins and durable IP protections that could last through 2039 for its flagship triple combo.
The analyst cited a blockbuster sales potential for VRTX’s kidney disease candidate, povetacicept, which the company has identified as a pipeline-in-a-product against multiple B-cell-mediated diseases, including IgA nephropathy (IgAN) and primary membranous nephropathy (pMN).
“We believe near-term data will solidify the increasingly promising prospects of povetacicept and see potential for reduction in a CF competitive overhang,” Abrahams added.
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