Moving a pipeline drug from inception to commercialization can take years for biotech companies. Analysts weigh in on upcoming catalysts for Sarepta Therapeutics Inc (NASDAQ:SRPT) and Intercept Pharmaceuticals Inc (NASDAQ:ICPT) as both companies try to move their lead candidate drugs one step closer to fruition.
Sarepta Therapeutics Inc
Eteplirsen, Sarepta’s lead pipeline candidate to treat Duchenne Muscular Dystrophy, or DMD, is being deliberated for FDA approval. Stephen Brozak of WBB Securities explains that he is optimistic that the drug will be approved by the FDA in May due its safety profile and the existing need for a DMD treatment.
Brozak highlights the drug’s safety profile, noting, “there has been no concern about the safety of the drug and increasing evidence that eteplirsen can delay the progress of a fatal disease.” With no significant safety concerns in the air, the advisory committee, or AdComm, to the FDA will be focusing on the drug’s efficacy. The analyst explains that the AdComm should evaluate the drug on two standards: “delay of disease progression” and “increased presence” of the disease.
Furthermore, the analyst underscores the involvement of the medical community, explaining that a group of prominent doctors invested in DMD wrote to the FDA, encouraging them to approve the drug. The AdComm to the FDA will meet on April 25, and the analyst is “hopeful” that the body will “render a positive recommendation.” The FDA usually follows the recommendation of the AdComm but does not have to. Consequently, Brozak expects “the FDA will provide conditional approval for eteplirsen on or before May 26, 2016.”
In light of the upcoming AdComm meeting and the analyst’s belief that eteplirsen will receive FDA approval, he reiterates a Strong Buy on Sarepta with a $40 price target.
According to TipRanks, Brozak has a 48% success rate recommending stocks with a +17.9% average one-year return per rating. Out the 10 analysts polled by TipRanks in the last 3 months, 4 are bullish on the company, 5 are neutral, and 1 is bearish. The average 12-month price target between these 10 analysts is $31, marking a 60% potential upside from current levels.
Intercept Pharmaceuticals Inc
Liana Moussatos of Wedbush weighs in on Intercept as the company has several upcoming catalysts. The analyst points to European Association for the Study of the Liver meeting (EASL) on April 13 and next week’s FDA Advisory Committee meeting on OCA in PBC, the company’s pipeline drug to treat a liver disease.
Early next week, Moussatos expects briefing documents to be released for OCA in PBC. She explains, “As with most briefing documents, we anticipate a critical tone particularly focusing on the use of surrogate endpoints for the Phase 3 program and the increased incidence of pruritus.” On April 7, the Advisory Committee, or AdComm, to the FDA will meet to discuss the drug. Even with some anticipated road bumps, the analyst believes the AdComm will vote in favor of the drug.
Shortly following on April 13, Intercept will be presenting 8 points at the EASL meeting on data from its pipeline drugs, OCA in PBC and OCA in NASH. The analyst highlights that Intercept will be hosting an event on April 16 “to discuss preparation for the launch of OCA in PBC,” assuming the drug gets a nod from the Advisory Committee on April 7.
Thanks to these upcoming positive catalysts for Intercept, Moussatos reiterates an Outperform rating on the stock with a $423 acquisition value.
According to TipRanks, Moussatos has a 34% success rate recommending stocks with a 2.4% average return per rating. Five analysts are currently bullish on Intercept while 3 remain on the sidelines. The average 12-month price target for the stock is $202, marking a 62% potential upside from current levels.