Achaogen Inc (NASDAQ:AKAO) shares rose 14% today after the company reported positive top-line results from the phase 3 trial of its treatment for urinary tract infections. The company expects to submit a new drug application (NDA) to the FDA in second half 2017, and a marketing authorization application (MAA) to the EMA in 2018.
In reaction, William Blair analyst Y Katherine Xu raised her price target to $25 (from $11), while reiterating an Outperform rating on AKAO.
Xu commented, “We believe these data strongly support approval in the United States and Europe and have raised our probability of commercialization both the EPIC and CARE study populations to 95% from 85% and 70%, respectively. Achaogen will submit an NDA to the FDA in second half 2017, and an MAA to the EMA in 2018.”
“We have increased our estimate for the list price at launch to $900 per day from our previous estimate of$855. We note that this is in line with the pricing of Avycaz. With the mortality data from CARE, we believe our estimate may be conservative as plazomicin could be priced at a premium to Avycaz. As a result, we have raised our peak sales estimate to $540 million from $350 million. We are now estimating $425 million in peak sales in the United States and $115 million in Europe. We had previously estimated $270 million in sales in the United States and $80 million in Europe. We note that our European sales estimate only includes the big five European countries,” the analyst continued.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Y Katherine Xu has a yearly average return of -1.5% and a 42% success rate. Xu ranked #3215 out of 4269 analysts.
As of this writing, all the 3 analysts polled by TipRanks rate Achaogen stock a Buy. With a return potential of 28%, the stock’s consensus target price stands at $19.