Janney Montgomery Scott analyst Paul Knight upgraded OncoCyte to Buy from Neutral, calling the announcement of data from its pivotal R&D validation study “transformational” and “the most critical step to commercialization” for its DetermaVu liquid biopsy test for lung cancer. The trial’s results significantly outperform any other previous blinded study of its kind, said Knight, who estimates DetermaVu’s annual addressable market at $4.7B. He doubled his fair value estimate on OcoCyte shares to $8 from $4.
Tuesday, January 29, 2019
OncoCyte price target raised to $7 from $4 at Lake Street
Lake Street analyst Thomas Flaten said OncoCyte’s (OCX) R&D Validation study results are in line with previously published data and better than requirements for commercialization. He noted that a company-sponsored survey of 250 chest physicians previously indicated they would require minimum sensitivity and specificity of 85% and 35%, respectively. Flaten believes the fact that the study results were generated solely on biomarkers creates a favorable competitive advantage relative to competitors Veracyte (VCYT) and BioDesix, he added. Stating that he thinks today’s results provide strong evidence the company can move forward with a commercially viable product, Flaten raised his price target to $7 from $4 and keeps a Buy rating on OncoCyte shares.
Piper Jaffray continues to recommend Biogen shares after Q4 results
Piper Jaffray analyst Christopher Raymond keeps an Overweight rating on Biogen with a $402 price target following the company’s sales and earnings beats in Q4. In regard to fiscal 2019 guidance, both revenue and non-GAAP earnings bracketed consensus but were above expectations at the midpoints, Raymond tells investors in a research note. The analyst continues to recommend the shares with “valuing creating updates quickly approaching.” Though pipeline progress will primarily focus on trial initiations over the next 12 months, BIIB098 Phase 3 head-to-head data versus Tecfidera in mid-2019 remains a key value creating catalyst for the stock, Raymond says. He sees a “de-risked” path to U.S. approval. Coupling this with highly anticipated aducanumab data, the stock has future upside, contends Raymond.
What to watch in large cap biotech earnings reports
The earnings season for large-cap biotech companies is in full swing with Biogen (BIIB) having already reported quarterly results and Amgen (AMGN) slated to report after the bell on Tuesday. Celgene (CELG) is due out at the end of this week and Gilead Sciences (GILD) soon after in early February. 1. BIOTECH STOCKS ON A TEAR: Since bottoming on December 24, the iShares Nasdaq Biotechnology Index (IBB), an ETF that tracks the stocks of biotech group, is up over 20%. Biogen, a component of the IBB, reported fourth-quarter results earlier today that beat on both the top and bottom lines. CEO Michel Vounatsos said in 2018 Biogen executed well against its strategic priorities and financial objectives. “We made significant progress in developing and expanding our pipeline, as well as advancing multiple modalities to potentially deliver new therapies to patients. We also reported solid revenue growth for the year, led by continued strong global penetration of Spinraza, significant gains in our biosimilars business, and resilience in our core MS business. We believe our strong base business, including a deep and diversified neuroscience pipeline, positions Biogen well to take advantage of the opportunities before us,” he stated. 2. AMGEN DOWNGRADE: Biotech heavyweight Amgen fell around 6% on Monday after Evercore ISI analyst Umer Raffat downgraded the stock to In Line from Outperform, citing increased biosimilar competition and an imminent court decision on Enbrel patents with Novartis’ (NVS) Sandoz. Raffat said he sees a reasonable chance the Enbrel patents are not upheld and thinks the consensus is not forecasting in a biosimilar Enbrel till the mid-2020s. Sandoz has expressed a desire to launch in the wake of a district court decision, and the appeals process will be wrapped up by January 2020 regardless, the analyst wrote in a note to investors. Further, Raffat thinks double patenting is a real concern for Amgen’s 2028 patents. 3. BIOSIMILAR THREAT: When the patent that protects a drug’s formula expires, other companies can release a drug with a similar chemical make-up, called a biosimilar, creating competition for the original drug maker. This past summer, Mylan (MYL) confirmed that it will launch its biosimilar pegfilgrastim at a wholesale acquisition cost of $4,175 per syringe, a price that reflects a 33% discount to the wholesale acquisition cost of Amgen’s reference product, Neulasta. Another large-cap biotech company, Celgene (CELG), has a key drug, Revlimid, which may see biosimilar pressure in a few years. 4. MORE MERGERS?: In early January, Bristol-Myers Squibb (BMY) and Celgene announced that they have entered into a definitive merger agreement under which Bristol will acquire Celgene in a cash and stock transaction with an equity value of approximately $74B. In the wake of the deal, Piper Jaffray analyst Christopher Raymond remained “bullish on biotech.” In a research note titled “Bristol for CELG – In Retrospect, it Makes Perfect Sense” that was published on January 3, Raymond said the market is likely to ask “who’s next?” Among large-caps, Alexion Pharmaceuticals (ALXN) and Biogen would seem to make sense as potential targets, as well as BioMarin (BMRN), Raymond wrote. While any small-to-mid cap could likely be seen as a take-out candidate, Aimmune Therapeutics (AIMT), Deciphera Pharmaceuticals (DCPH) and Rigel Pharmaceuticals (RIGL) “in particular could make sense to any strategic buyer,” added the analyst at the time.
Prana treatment of multiple system atrophy granted orphan designation
Prana Biotechnology’s treatment of multiple system atrophy was granted orphan designation by the FDA, according to a post to the agency’s website.
https://thefly.com/landingPageNews.php?id=2855391
Biogen price target raised to $397 from $392 at Stifel
Stifel analyst Paul Matteis raised his price target for Biogen to $397 from $392 after the company reported quarterly results. The analyst notes that the Multiple Sclerosis business – not including Ocrevus royalties – ended 2018 slightly down, and he expects to see a continued trend of flat-to-moderately compressing sales over the next year. Spinraza miss a “small disappointment,” but patient adds seem strong, he contends, adding that prior experience with the U.S. launch cadence assuages most of his concerns. Additionally, Matteis believes that antisense oligo programs in Amyotrophic Lateral Sclerosis continue to look interesting. The analyst reiterates a Buy rating on the shares
https://thefly.com/landingPageNews.php?id=2855393
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