J.P. Morgan Reiterates Overweight on Keryx Biopharmaceuticals Following Investor Meetings with Management

In a research report issued Friday, J.P. Morgan analyst Cory Kasimov reiterated an Overweight rating on shares of Keryx Biopharmaceuticals (NASDAQ:KERX), and slightly reduced the price target to $16 (from $17), after hosting CEO Greg Madison and Senior Director of IR Lora Pike for a day of investor meetings in Baltimore and Philly.

Kasimov wrote, “Not surprisingly, discussion focused largely on what the company is doing to turn around the US launch of Auryxia (new VP of sales, a refined marketing strategy being rolled out to reps next week). Questions also touched on the ongoing trial in non-dialysis CKD (data anticipated in 2Q16) and the market opportunity in that setting (~2-3x the number of pts), as well as the recent EU approval (broad label in ESRD and CKD with ESA/IV iron data included) and EU strategy (seeking a partner, intend to have strategy in place by 4Q).”

“We have increased the probability of success we assign to the EU given full approval (from 85% to 100%) and now model it as a royalty to KERX given commentary around seeking a partner (we assume tiered royalty in the high teens), as well as potential milestones tied to the launch/sales in the EU. We have also updated our model to reflect the 9% price increase KERX took this month; we note that Auryxia is now priced at a ~12% discount to Renvela vs. a 9% premium at launch (given aggressive price increases taken by Renvela). The net effect of our changes is a lowering of our YE16 price target to $16,” the analyst continued.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Cory Kasimov has a total average return of 0.8% and a 39.5% success rate. Kasimov has an -29.0% average return when recommending KERX, and is ranked #1810 out of 3764 analysts.

Out of the 9 analysts polled by TipRanks, 5 rate Keryx Biopharmaceuticals stock a Buy, 3 rate the stock a Hold and 1 recommends Sell. With a return potential of 240.4%, the stock’s consensus target price stands at $12.56.

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