Jefferies Reiterates Hold on Opko Health Inc. (OPK) Following FDA Setback for Rayaldee

In a research report issued yesterday, Jefferies analyst Brandon Couillard reiterated a Hold rating on shares of Opko Health Inc. (NYSE:OPK) with a price target of $11, after the drug maker announced that the FDA has issued a CRL regarding the company’s New Drug Application (NDA) for Rayaldee (calcifediol) as a treatment for secondary hyperparathyroidism in patients with stage 3 or 4 chronic kidney disease and vitamin D insufficiency.

Couillard wrote, “At a minimum, Rayaldee’s commercialization timeline is firmly in limbo & outside of OPK’s control. Once CTLT resolves the issues, OPK will resubmit another NDA, which could take 2-6 months to reconsider, depending on whether or not FDA wants another re-inspection (not mandatory with 483s). At best, given the seemingly benign nature of the deficiencies, we think Rayaldee could be approved as early as Aug/Sep (in line with initial 2H16 launch plan). On the other hand, a more protracted resolution process could delay the launch until late-4Q16/ early next year.”

The analyst concluded: “While nonfatal, the setback adds a new level of uncertainty around a key value driver […] Given the significance of Rayaldee to our SOTP/NPV valuation, accounting for ~$3 (nearly 30%) of value, we suspect greater clarity around CTLT’s remediation efforts will be needed for the stock to work.”

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Brandon Couillard has a total average return of 10% and a 71% success rate. Couillard is ranked #250 out of 3840 analysts.


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