Healthcare analysts are weighing in on biotech stocks Portola Pharmaceuticals Inc (NASDAQ:PTLA) and Sophiris Bio Inc (NASDAQ:SPHS), as shares of both companies fell sharply today. The analysts reflect on Portola’s phase 3 APEX, which missed primary efficacy, and Sophiris’ quarterly update.
Portola Pharmaceuticals Inc
Thursday turned out to be a nightmare for shareholders of Portola Pharmaceuticals as the stock price tumbled nearly 30%, after the biotech company reported that topline data from its Phase 3 APEX study evaluating oral betrixaban compared with standard of care drug enoxaparin for the prevention of blood clots in terminally ill patients failed to meet a primary endpoint.
In reaction, Cowen analyst Phil Nadeau reduced the price target for the stock from $65 to $40, while reiterating an Outperform rating.
Nadeau commented, “We are pushing out assumptions for betrixaban’s FDA approval from 2017 to 2020. While we still project that betrixaban can achieve $1B in peak sales, the expiration of its U.S. patents in 2026 will truncate its commercial life in the U.S. Our DCF-based price target has decreased from $65 to $40. Despite the cut to betrixaban estimates, Portola appears substantially undervalued for the potential of betrixaban and andexanet.”
“Betrixaban reduced the risk of VTE by 20-25% in APEX, with no increase in the risk of major bleeds. Unfortunately, APEX’s primary endpoint just missed stat. sig. (p=0.054). While we think clinical benefit was demonstrated, we think it likely that another Ph. III will be required. Our DCF-based PT has decreased from $65 to $40. We continue to think that Portola is undervalued,” the analyst added.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Phil Nadeau has a total average return of -1.7% and a 33.7% success rate. Nadeau has a -42.5% average return when recommending PTLA, and is ranked #2869 out of 3809 analysts.
Sophiris Bio Inc
Shares of Sophiris dropped nearly 13% after reporting a net loss of $2.5 million for 4Q15, while ending the period with $8.4 million in cash. Subsequently, Maxim analyst Jason Kolbert reiterated a Buy rating on the stock, with a price target of $4, which represents a potential upside of 172% from where the stock is currently trading.
Kolbert noted, “Hitting a P value in the phase III BPH study “PLUS-1” of topsalysin (improved IPSS, P=0.043) suggested that if Sophiris could “blow up” PSA expressers to ‘shrink’ prostates and relieve BPH symptoms, they could do it for PSA expressing prostate tumors too…and so far it looks like it works. Some of the options for men with localized prostate cancer are ‘watch and wait’, and ultimately radical prostatectomy. Topsalysin could be a one time, in office procedure that takes just a couple of minutes that avoids or delays invasive surgery (and all of the permanent side effects).”
According to TipRanks.com, analyst Jason Kolbert has a total average return of -16% and a 29% success rate. Kolbert has a 82% average return when recommending SPHS, and is ranked #3745 out of 3809 analysts.