Rigel Pharmaceuticals’ (NASDAQ:RIGL) rare drug Tavalisse (fostamatinib), designed to treat chronic immune thrombocytopenia (ITP) has won FDA approval for adult patients who had not responded well to past treatments. This makes RIGL’s asset the first SYK inhibitor to gain a nod from the FDA, which H.C. Wainwright analyst Joseph Pantginis is taking in bullish stride.
In reaction, the analyst reiterates a Buy rating on RIGL stock while boosting the price target from $6.70 to $8, which implies a 109% upside from current levels. (To watch Pantginis’ track record, click here)
Keep in mind, this approval follows without the FDA panel even assembling, purely on the back of two Phase 3 trials that showcased consistent response rates in patients on Rigel’s treatment along with another open-label extension trial. The analyst notes, “While the second study was not statistically significant, it is important to point out that the placebo impact to the statistics was due to a single patient skewing the results.”
Ultimately, “Broad label puts Tavalisse firmly in the second-line therapy sandbox. The FDA label states that Tavalisse is to be used by adult patients ‘who have had an insufficient response to a previous treatment’, which firmly places it as a second-line therapy and beyond. Being the first Syk inhibitor to be approved by the FDA, approval as a second-line therapy places Tavalisse in direct competition with thrombopoietin-receptor (TPO-R) agonists such as Amgen’s […] Nplate and Novartis’ […] Promacta, and we believe it may be priced close to current therapies (we project $100K annual cost per year). However, it can also target TPO refractory patients, a population with no currently available therapy, representing a significant ongoing unmet medical need,” writes Pantginis, cheering that “May 2018 brings flowers and Tavalisse” with a “commercial launch around the corner.”
Moving forward, the analyst anticipates market penetration into ITP, an MAA filing in the European Union come fourth quarter before RIGL inks a partnership alliance, and a potential partner by the end of the year or beginning of next year. RIGL has its sights on finding a partner in Asia additionally next year along with filing in Canada.
TipRanks indicates this drug maker is a Strong Buy among sell-side analysts on the Street. All 6 analysts polled in the last 3 months rate a Buy on RIGL stock. With a return potential of nearly 86%, the stock’s consensus target price stands at $7.20.