Maxim’s healthcare analysts are weighing in on the Boston drug company Keryx Biopharmaceuticals (NASDAQ:KERX) and cancer drug discovery company Kite Pharma Inc (NASDAQ:KITE), following recent announcements.
In a research report published Friday, Maxim analyst Jason Kolbert reiterated a Buy rating on shares of Keryx Biopharma, with a price target of $11, after the company announced that it has entered into an agreement to raise $125 million through the private placement of Convertible Senior Notes due 2020 ($3.74) with the Baupost Group, L.L.C.
Kolbert noted, “The company now has $225M in cash (9.30.2015) and guided to an $87-$92M burn excluding COGS. As outlined in the press release Baupost will have the right to appoint a director to Keryx’s Board by the end of 2015. Baupost will also appoint an observer to Keryx’s board.”
“Have Sales Improved yet? We have yet to see a break out but we remain hopeful that we will eventually get there. Recall that Keryx reported anemic sales of Auryxia of just $1.7M last quarter. How is that possible in a billion dollar marketplace? We do believe that Auryxia is a best in class drug and that is the fundamental element of our thesis. Anemic sales makes us question what are we missing but KOL feedback remains, “best in class”. We have to wait and see now,” the analyst continued.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jason Kolbert has a total average return of -15.8% and a 25.7% success rate. Kolbert has a -58.0% average return when recommending KERX, and is ranked #3777 out of 3779 analysts.
Out of the 8 analysts polled by TipRanks, 3 rate Keryx stock a Buy, 4 rate the stock a Hold and 1 recommends a Sell. With a return potential of 117.39%, the stock’s consensus target price stands at $9.50.
Kite Pharma Inc
Maxim analyst Jason McCarthy weighed in today with a few insights on Kite Pharma, after the company announced that KTE-C19, the company’s chimeric antigen receptor-based therapy, received positive opinions and recommendation for orphan designation in Europe for certain leukemia’s, including ALL, the target of competing CAR-T products from Juno and Novartis.
McCarthy observed, “This is positive news for Kite as the company continues to expand KTE-C19 to multiple B cell cancer indications. Kite is already targeting a much larger indication (initially) in lymphomas (10,000 deaths per year) than both Juno and Novartis who are targeting leukemia first (1,400 deaths per year).”
“TE-C19 has more orphan designations in Europe than either Juno or Novartis. Kite’s focus on Europe with this many orphan designations may give the company a potential marketing advantage over the competition. Recall that Kite, Juno, and Novartis each have similar CD-19 CAR-T products, and given the positive data we have seen to date, each will likely be approved in 2017, albeit Kite in Lymphoma and the others in Leukemia,” the analyst continued.
McCarthy rates Kite shares a Buy, with a price target of $87, which implies an upside of 35% from current levels.
According to TipRanks, analyst Jason McCarthy has a total average return of -10.7% and a 37.9% success rate. McCarthy has a -0.4% average return when recommending KITE, and is ranked #3541 out of 3779 analysts.
Out of the 7 analysts polled by TipRanks, 6 rate Kite Pharma stock a Buy, while 1 rates the stock a Hold. With a return potential of 28%, the stock’s consensus target price stands at $82.43.