Oppenheimer Maintains Perform On Vertex Pharmaceuticals Despite Positive FDA Advisory Panel Outcome


In a report sent to investors today, Oppenheimer analyst Yigal Nochomovitz maintained a Perform rating on Vertex Pharmaceuticals (NASDAQ:VRTX), following the positive FDA advisory panel vote in favor of efficacy (9 Yes, 6 No), safety (14 Yes, 1 No) and overall approvability (13 Yes, 2 No) of the company’s ivacaftor in R117H CF patients age 6+. No price target was given.

Nochomovitz said, “As expected, the thrust of the panel discussion revolved around how to interpret the voting questions (age 6+) given 1) stat. sig. FEV1 favoring placebo in ages 6-11; 2) no data in ages 12-17. In view of the challenges and potential long timelines required to conduct additional studies in pediatrics/adolescents, the FDA specifically encouraged “flexibility” in considering an age 6+ label given unique circumstances, which appeared to have loosened the panelists’ thinking on the key voting questions.”

The analyst concluded, “We believe future revenues for R117H are already discounted in the stock. The key debates for VRTX continue to be 1) combo pricing where every ~$10K above our ~$200K WAC assumption would add ~$5 to our valuation, 2) efficacy in heteros, where we expect 2 correctors + Kalydeco to be needed.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Yigal Nochomovitz has a total average return of 8.1% and a 66.7% success rate. Nochomovitz is ranked #1940 out of 3337 analysts.

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