Roth Capital Retains Buy On PTC Therapeutics Following Conditional EU Approval For Ataluren


In a research note published today, Roth Capital analyst Debjit Chattopadhyay reiterated a Buy rating on PTC Therapeutics (NASDAQ:PTCT) with a $43 price target, in light of the EU’s conditional approval for Ataluren and suspicions of accelerated approval in the US.

Chattopadhyay wrote, “While ataluren failed to demonstrate a statistically-significant outcome in the first randomized study of its kind to be conducted in DMD, patients had a substantial clinical benefit. Patients in the decline phase and those with baseline 6MWD below 350 meters, had a statistically-significant 50 and 68 meters benefit. In context of the disease setting this was compelling enough for a conditional EU approval and we expect accelerated approval in the US.”

The analyst continued, “First generation disease modifying therapies are attempting to make incremental progress over glucocorticoid-based standard-of-care. Although glucocorticoid therapy has slowed the progression of DMD, patients are burdened with an adverse event profile, which is self-limiting (for example weight gain compounds the physical limitations of dystrophic myopathy). Over the past 12-months there appears to be a greater understanding within the agency on the natural history and progressive nature of DMD. Importantly, the preliminary guidance highlights the willingness of patients and families to undertake greater risk in exchange of disease stabilization. Previously, the agency has been hesitant to expose young subjects to unnecessary risks of relatively untested pharmacological agents. However, in case of DMD the risk of doing nothing potentially exceeds the risk of a limited and conditional approval, in our opinion. The guidance highlights the fact that DMD is a debilitating disease with a very narrow window of opportunity for a therapeutic intervention to preserve QOL. We continue to believe that patients need to be treated as early as possible, since therapies aimed restoring functional Dystrophin, to be truly effective, need preexisting myofibers. Based on ataluren’s pharmacology, chemistry, and robust safety profile we believe PTCT is uniquely positioned with an appropriately balanced reward/risk profile.”

 According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Debjit Chattopadhyay has a total average return of 1.3% and a 33.3% success rate. Chattopadhyay has a 3.7% average return when recommending PTCT, and is ranked #2014 out of 3289 analysts.

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