UPDATE: Brean Capital Raises Nektar Price Target To $20 On The Heels Of FDA Approval Of Movantik
In a research report released today, Brean Capital analyst Jonathan Aschoff reiterated a Buy rating on Nektar Therapeutics (NASDAQ:NKTR) and raised his price target to $20 (from $18). The report follows today’s news that the FDA approved the company’s Movantik for OIC in adult patients with chronic non-cancer pain.
Aschoff noted, “As expected from June’s Advisory Committee, AstraZeneca and Nektar agreed to conduct a post-marketing observational epidemiologic study to evaluate CV safety with Movantik. This study should cost $10-20 million in total, with Nektar being responsible for 1/3 the cost. It is important to note that the FDA did not request any post-marketing CVOT. AstraZeneca will launch Movantik as soon as the de-scheduling process at the DEA concludes, and the company is guiding a 1H15 launch in the US and EU. The US approval will convert the $70M already received from AstraZeneca to a nonrefundable milestone from a loan, and trigger an additional milestone of $35M as no CVOT is required pre-approval. Movantik is the first oral PAMORA approved by the FDA for chronic OIC, and Nektar believes Movantik will not face oral PAMORA competition for at least 2-3 years; but if oral Relistor can piggyback on the injectable safety data, its approval could come in 18 months. About 26 million patients in the US rely upon opioids for chronic pain, with over 5 million suffering from OIC not well controlled by laxatives. The total addressable uncontrolled US chronic OIC market adds up to about $11.5 billion, and our estimated maximum of about 10% of it for Movantik is quite reasonable, in our view.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jonathan Aschoff has a total average return of 15.9% and a 54.4% success rate. Aschoff has a -4.8% average return when recommending NKTR, and is ranked #185 out of 3282 analysts.