Incyte Corporation (NASDAQ:INCY) and Eli Lilly and Company (NYSE:LLY) announced that Lilly has submitted a new drug application (NDA) to the U.S. Food and Drug Administration (FDA) for the approval of oral once-daily baricitinib for the treatment of moderately-to-severely active rheumatoid arthritis (RA).
As a result, Incyte will receive a milestone payment of $35 million from Lilly related to the NDA submission. If baricitinib is granted U.S. regulatory approval, Incyte will receive a milestone payment of $100 million from Lilly.Incyte could earn additional global regulatory as well as sales-based milestone payments and be eligible for royalties on global net sales of baricitinib.
If approved, Lilly will lead launch and global commercialization efforts for baricitinib in RA. Lilly owns global rights to develop and commercialize baricitinib as an oral treatment for all inflammatory conditions.
This submission milestone will result in a first-quarter charge to Lilly’s GAAP and non-GAAP research and development expense of $35 million (pre-tax). Lilly’s previously-issued 2016 GAAP and non-GAAP EPS guidance of$2.92-$3.02 and $3.45-$3.55, respectively, remain unchanged.
“Lilly’s collaboration with Incyte has produced a rigorous phase 3 program and, if approved, the potential of a promising new treatment option for people with RA,” said David Ricks, president of Lilly Bio-Medicines. (Original Source)
Shares of Incyte closed last Friday at $76.95. INCY has a 1-year high of $133.62 and a 1-year low of $72.62. The stock’s 50-day moving average is $104.99 and its 200-day moving average is $110.44.
On the ratings front, Incyte has been the subject of a number of recent research reports. In a report released today, UBS analyst Matt Roden reiterated a Buy rating on INCY, with a price target of $135, which implies an upside of 75.4% from current levels. Separately, on January 6, Piper Jaffray’s Joshua Schimmer reiterated a Buy rating on the stock and has a price target of $125.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Matt Roden and Joshua Schimmer have a total average return of 17.5% and -17.8% respectively. Roden has a success rate of 56.1% and is ranked #160 out of 3582 analysts, while Schimmer has a success rate of 18.4% and is ranked #3572.
Overall, 6 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $133.00 which is 72.8% above where the stock closed last Friday.
Incyte Corp is a biopharmaceutical company. It discovers, develops and commercializes proprietary small molecule drugs to treat serious unmet medical needs, mainly in oncology.