Mylan Wins More than Just FDA Approval, But Also Key Validation
Mylan N.V. (NASDAQ:MYL) shares are on a big 19% upturn after the company shocked and awed the Street today with a fortuitous approval from the FDA for its generic takes on Teva’s Copaxone. In fact, the drug maker could stand to garner a 180-day exclusivity for its drug designed to prevent the relapse of multiple sclerosis (MS). Considering Mylan has tried to secure the agency’s favor for many years, shareholders are no doubt clapping loudly today with the positive curveball hitting a home run at last.
Mizuho analyst Irina Rivkind Koffler chimes in with a bullish research note today, looking for an immediate launch that will reap generic Copaxone sales as early as the end of this year for the Mylan.
Koffler contends, “After downplaying the possibility of a September approval and taking Copaxone out of its 2017 estimates, Mylan unexpectedly received FDA approval of both doses (40 mg 3x/week injection, and 20 mg/daily injection). Importantly, Copaxone is AP rated (or therapeutically equivalent and substitutable), which makes it easier to switch existing Copaxone patients to the generic. Also, Mylan may be eligible for 180-day exclusivity of this product, though the FDA did not indicate other entrants (namely Momenta/Sandoz) would not be able to also enter the market. It is not clear how delayed this second entrant has become due to manufacturing issues at its contract manufacturer. […] Mylan plans to launch the drug imminently, so we expect almost a full quarter of generic Copaxone sales in 2017. We expect MYL to rally because Copaxone approval has eluded it for years, and the news validates the company’s ability to execute on complex generics. We think Advair is next.”
As such, the analyst maintains a Buy on shares of MYL with a $37 price target. (To watch Koffler’s track record, click here)
Wall Street is in a toss-up when it comes to this biotech mover and shakers, as according to TipRanks, based on 10 analysts polled in the last 3 months, half rate a Buy on Mylan stock while half maintain a Hold. The 12-month average price target stands at $37.56, marking a nearly 3% downside from where the stock is currently trading.
Endocyte Gains Wedbush’s Confidence with Licensing Deal
Endocyte, Inc. (NASDAQ:ECYT) shares investors have gotten a taste of excitement in light of Monday’s reveal of in-licensing for its Phase III-ready prostate cancer drug PSMA-17, which sent shares climbing 157% Monday and a rough upturn 20% higher yesterday.
The news is enough to sway Wedbush analyst David Nierengarten over to the land of the bulls, as Endocyte’s asset now “improves our outlook,” asserts the analyst, who appreciates the “attractive opportunity” waiting in the wings.
In reaction, the analyst upgrades from a Neutral to an Outperform rating on ECYT stock while bumping up the price target from $2 to $5. (To watch Nierengarten’s track record, click here)
This kind of prospect spotlights prospective peak sales ranging past $600 million, which the analyst compares to direct rival German pharma firm Bayer AG’s labeled drug Xofigo, who boasts a $400 million plus revenue run rate. Moreover, Nierengarten sings the praises of “ECYT’s already cheap valuation (even with run-up today, the company is valued just ~$30M above estimated YE cash).”
When measuring Endocyte’s prostate cancer drug up against Xofigo, the analyst places a “broader opportunity and fewer hurdles” under Endocyte’s belt in comparison, explaining: “We note that Xofigo is only approved for patients with disease that has spread to the bones, and needs to be paired with another drug to address soft tissue disease, whereas PSMA-617 has shown activity in patients with PSMA+ disease in both bone and soft tissue. Xofigo, developed by Algeta (acquired by Bayer in 2013), is on track to exceed $400M in sales this year. We note that the success of Xofigo comes despite constraints in procuring 223Ra, as long half-life of parent (227Ac and 227Th isolated from a 231Pa source) limits supply; production of 177-Lu is less restricted in comparison, with multiple routes of production identified.”
The initial word of the Street looks positive for the drug maker, as TipRanks analytics demonstrate ECYT as a Buy. Out of 2 analysts polled by TipRanks in the last 3 months, 1 is bullish on Endocyte stock while 1 remains sidelined. With a return potential of 25%, the stock’s consensus target price stands at $7.00.