Shares of biotech companies Oncomed Pharmaceuticals Inc (NASDAQ:OMED) and OvaScience Inc (NASDAQ:OVAS) fell sharply today following clinical trial setback and analyst downgrade, respectively. Let’s take a look and see what analysts have to say about OMED and OVAS.
Oncomed Pharmaceuticals Inc
Shares of Oncomed Pharmaceuticals lost over 40% of their value today after an independent data safety monitoring board (DSMB) suggested that a Phase II study of the company’s experimental drug tarextumab in patients with pancreatic cancer is unlikely to meet its main goal.
Adding insult to injury, Leerink Swann analyst Paul Matteis downgraded shares of OncoMed from an Outperform to a Market Perform rating, while slashing the price target to $11 (from $27).
Matteis commented, “While PC is a very challenging shot on goal, we believe this poses a minor negative read-through onto the clinical potential of Demcizumab (also acts on the Notch pathway) but a more broadly cautious read-through for our ability to generate positive conviction from early stage single arm combination data for other pipeline products. Other data safety monitoring board meetings for Tarextumab/Dem ph2s will occur in 2016 ahead of ph2 results late this year or in 2017.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Paul Matteis has a yearly average return of -31.5% and a 10.3% success rate. Matteisis ranked #3547 out of 3608 analysts.
Out of the 4 analysts polled by TipRanks, 3 rate OncoMed Pharmaceuticals stock a Buy, while 1 rates the stock a Hold. With a return potential of 261%, the stock’s consensus target price stands at $34.25.
Oppenheimer analyst Rohit Vanjani downgraded shares of OvaScience from Outperform to Perform and removed his $16 price target. OvaScience shares reacted to the downgrade, falling nearly 13% as of 12:50PM EST.
Vanjani explained, “While we still believe there is substantial opportunity in the fertility space overall and for OvaScience’s first launched technology, AUGMENT, we believe that realizing that opportunity may take some time. With the impending CEO change at the company, the commercial infrastructure build that lies ahead, the ongoing consolidation in the IVF clinic space, and OvaScience’s updated strategy to drive patient awareness, AUGMENT traction and ultimately revenues may continue to be challenged in 2016. Additionally, the catalysts that do lie ahead of infrastructure build and a go/no go decision on OvaPrime in late 2016 will likely not be enough to drive the shares in the near term, in our view.”
According to TipRanks.com, analyst Rohit Vanjani has a yearly average return of 13.8% and a 53% success rate. Vanjani has a -43.1% average return when recommending OVAS, and is ranked #117 out of 3608 analysts.
Out of the 6 analysts polled by TipRanks, 3 rate OvaScience stock a Buy, 2 rate the stock a Hold and 1 recommends Sell. With a return potential of 491%, the stock’s consensus target price stands at $44.