J.P. Morgan’s healthcare analyst Cory Kasimov came out with a brief commentary on the biotech company Clovis Oncology Inc (NASDAQ:CLVS) and pharmaceutical giant Gilead Sciences, Inc. (NASDAQ:GILD), following recent announcements and events.
Clovis Oncology Inc
In a research report released Tuesday, J.P. Morgan’s Kasimov reiterated an Overweight rating on shares of Clovis Oncology, while slashing the price target to $42 (from $110), after the company announced a potential delay in FDA approval for rociletinib in lung cancer as the agency requested additional data for use in the efficacy analysis.
Kasimov commented, “On the back of this update, management credibility obviously takes a significant hit (on its 3Q call on 11/5 the company continued to talk enthusiastically about potential for near-term approval/launch despite having this data in hand). Our knee-jerk reaction upon seeing the news was to step to the sidelines; however, we estimate current levels reflect minimal contribution from roci, which is likely overdone as we still anticipate the drug to be approvable (albeit much less competitive), and the value of other pipeline assets (rucaparib, lucitanib) are intact. Our updated model results in a new Dec 2016 target to $42, but we are currently maintaining our OW rating as we look to do more diligence around roci’s new profile.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Cory Kasimov has a total average return of -2.6% and a 43.4% success rate. Kasimov has a -59.5% average return when recommending CLVS, and is ranked #3384 out of 3847 analysts.
Out of the 5 analysts polled by TipRanks in the last 3 months, 2 rate Clovis Oncology stock a Buy, while 3 rate the stock a Hold. With a return potential of 31.29%, the stock’s consensus target price stands at $36.25.
Gilead Sciences, Inc.
Kasimov also weighed in on Gilead Sciences after attending the American Association for the Study of Liver Diseases (AASLD) annual meeting, where Gilead presented additional data from the Phase 2 trial evaluating sofosbuvir+velpatasvir+GS-9857 in HCV genotypes 1 and 3. Kasimov has a 2.6% average return when recommending GILD, according to TipRanks.
The following bullets contain some highlights from Kasimov’s report:
- After 8 weeks of sof/vel+GS-9875, a 100% SVR12 rate was observed in cirrhotic, treatment experienced GT1 and GT3 patients, and 89% in GT1 patients previously treated with a PI.
- Data presented from MRK’s C-EDGE trial demonstrate high efficacy among injection drug users, providing supporting evidence that these patients can/should be treated.
- A paper presented by the NIH highlights the potential for re-treatment with Harvoni after an initial failure after short-duration treatment with a DAA combination.
- An observational trial from the VA shows SVR12 rates in GT1 patients Harvoni treated in a real world setting to be on par with clinical trials.
- Another observational trial (real world efficacy from the HCV-TARGET consortium) underscored Harvoni’s real world efficacy, though concludes that the 8week treatment duration is under used.
The analyst concluded, “Data presented shows encouraging SVR12 rates (vs. SVR4s in abstract) after 6 or 8 weeks of therapy in more difficult to treat patient populations, with combination continuing to be safe and well tolerated (recall data at EASL earlier this year showed mix results with 6week treatment duration).”
Kasimov rates Gilead Sciences an Overweight, with a price target of $133, which implies an upside of 28% from current levels.
Out of the 23 analysts polled by TipRanks, 18 rate Gilead Sciences stock a Buy, 4 rate the stock a Hold and 1 recommends Sell. With a return potential of 23.2%, the stock’s consensus target price stands at $128.37.