Alkermes Plc

All eyes today on Alkermes Plc (NASDAQ:ALKS) as the biopharmaceutical company announced positive phase 3 data for ALKS 5461, a pipeline drug for the adjunctive treatment of major depression. In the wake of the results, Alkermes shares are up 37% in pre-market trading Friday.

In reaction, J.P. Morgan analyst Cory Kasimov upgraded ALKS from Neutral to Overweight, while boosting the price target to $78 (from $51), which implies an upside of 79% from last closing price.

Kasimov wrote, “We are adding the product to our model and upgrading to OW. As we have previously noted, we felt a positive trial combined with the consistency/totality of the overall efficacy and safety dataset from the pivotal FORWARD program could make this drug approvable. Taking a step back from the noise around today’s development, we would emphasize the overall emerging profile for ALKS; this is an Irish domiciled co with 2 wholly owned and approved CNS assets, and now a third product that appears to be well on its way.”

“Headed into 2017 we see the combination of ALKS’ legacy base business, Vivtrol’s growth potential, Aristada’s schizophrenia launch and a wholly owned depression drug as an attractive combo that makes this a name we’d want to own. To that end, we have taken a fresh look at our model assumptions and our raising our YE17 target to $78,” the analyst added.

As usual, we recommend taking analyst notes with a grain of salt. According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Cory Kasimov has a yearly average loss of 15.1% and a 23.9% success rate. Kasimov has a 6.9% average return when recommending ALKS, and is ranked #4050 out of 4183 analysts.

Out of the 8 analysts polled by TipRanks, 6 rate Alkermes stock a Buy, 1 rates the stock a Hold and 1 recommends to Sell. With a return potential of 46%, the stock’s consensus target price stands at $63.29.

Rigel Pharmaceuticals, Inc.

In a research report released Friday, H.C. Wainwright analyst Shaunak Deepak reiterated a Buy rating on shares of Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL), while reducing the price target to $6.00 (from $7.00), after the company reported disappointing results from its second Phase 3 trial for fostamatinib in Immune Thrombocytopenic Purpura (ITP), an autoimmune disease where the immune system attacks and destroys platelets in the blood.

Deepak commented, “We believe these data, in addition to preliminary data from the extension study, complement previously reported fosta response rate data, but believe the FIT 2 miss could lead to a more dramatic FDA panel and may impair ex-U.S. partnership prospects. We are reducing our probability of success from 80% to 70%.”

“The company acknowledged the potential for an FDA advisory committee panel meeting in 4Q17, which we see as likely, given the mixed pivotal trial data, novel syk inhibition mechanism of action, and the fact that both approved TPO agents had panels. Although a panel may be contentious, we believe that fosta has demonstrated a durable clinical benefit and is supported by a 5,000 patient-year safety database.”

According to TipRanks.com, analyst Shaunak Deepak has a yearly average loss of 24.9% and a 21% success rate. Deepak has a 12% average return when recommending RIGL, and is ranked #3983 out of 4183 analysts.

As of this writing, all the 5 analysts polled by TipRanks rate Rigel Pharmaceuticals stock a Buy. With a return potential of 179%, the stock’s consensus target price stands at $7.63.