Incyte’s Bile Duct Cancer Drug Wins FDA Approval

Pemazyre is the first and only FDA-approved treatment for this indication, which was approved under accelerated approval based on overall response rate and duration of response (DOR).

“INCY shares have rallied of late, and we maintain a Neutral rating and $79 PT based on our view that meaningful catalysts for the shares are unlikely until 2021” commented Mizuho Securities’ Mara Goldstein following the approval. Indeed, her $79 price target indicates a significant 21% downside from the current share price.

The analyst added that “the combination of low-risk revenue stream in JAKAFI and solid cash position is likely leading investors to view shares as a relative safe haven in the current market environment.”

She believes that Pemazyre has a U.S. & E.U. market opportunity of approximately $800 million, and notes that the drug enjoys a best-in-class safety profile.

According to Goldstein, the approval “is incrementally positive for shares, and we see this as a first step in the pursuit of more meaningful commercial opportunities such as urothelial cancer (we estimate a U.S. and E.U. addressable market of ~$7 bln, FIGHT-201, -205) and the possibility of a tumor-agnostic indication (FIGHT-207) which would be additive.”

TipRanks reveals that INCY has a Moderate Buy consensus with an $88 price target. With shares surging 15% year-to-date, the price target translates into downside potential of 12%. (See Incyte stock analysis on TipRanks).

“Although cholangiocarcinoma is considered a rare disease, it has been on the rise over the past three decades,”said Ghassan Abou-Alfa, MD, of Memorial Sloan Kettering Cancer Center. “It is encouraging to have a new targeted treatment option for patients who historically have had limited options after first-line chemotherapy or surgery, in which relapse rates remain high.”

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