Yahoo Finance Ultragenyx Has Multiple Catalysts This Year, Says H.C. Wainwright
Ultragenyx Pharmaceutical Inc (NASDAQ: RARE) has multiple catalysts this year that could boost its stock price over $100 in the next 12 months.
Founded in 2010, Ultragenyx is a clinical-stage biopharmaceutical company working on the treatment of rare and ultra-rare diseases, with a focus on serious, debilitating genetic diseases.
"In our opinion, in 2016– early 2017, Ultragenyx will transform itself from a developmental stage company into a commercial entity," H.C. Wainwright analyst Carol Ann Werther wrote in a note to clients.
Ann Werther, who initiated the coverage of the stock with a Buy rating, said Ultragenyx is a unique company that has in-licensed product candidates with low risk of failure to treat ultra-orphan conditions.
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The Initiation And Justification
The company is developing multiple clinical-stage programs that are moving along swiftly, with key data and late-stage progress expected across the pipeline in 2016 through early 2017. It has five programs in Phase 3 this year and three regulatory filings expected by end of 2016 or early 2017, and the conditional approval of Ace-ER expected mid-year in the European Union.
The key milestones expected to drive the shares higher include the 40-week data including more rickets data in the all 52 patients from the Phase 2 KRN23 in pediatric X-Linked Hypophosphatemia (XLH); the Phase 2 KRN23 in tumor-induced osteomalacia. It is also expecting the top line data from the Phase 3 study of Recombinant human beta-glucuronidase (rhGUS) in MPS 7 patients by mid-2016.
Both XLH and osteomalacia are caused from phosphate-wasting due to excess activity of FGF23. FGF23 is a hormone that reduces serum levels of phosphorus and vitamin D by regulating phosphate excretion and vitamin D production by the kidney.
Recombinant human beta-glucuronidase (rhGUS) is an investigational therapy being developed for Mucopolysaccharidosis 7 (MPS 7), also known as Sly Syndrome – a metabolic disorder.
"We expect the first product launch to occur by YE16 once the conditional approval is granted in 2H16. Beginning in 2017, we expect product launches for the first four candidates to occur each year through 2020 as the company plans to market it product candidates worldwide with the exception of KRN23. We predict the company will be profitable in 2019," Ann Werther noted.
The company has sufficient cash to fund its drug development. As of September 30, 2015, the company had $581.9 million in cash.
Orphan Drugs And The Pharma Sector
Orphan drugs are a major area of product development since the FDA put into law in 1983 benefits for companies that are targeting rare disease that affect no more than 200,000 people. So far, about 7,000 rare diseases have been identified, and approximately half of which afflict fewer than 25,000 people. Based on recent Thomson Reuters figures, revenues of orphan drugs are ahead of non–orphan drugs 25.8 percent versus 20.1 percent over the last decade.
"In our view this is an opportune time to invest in RARE share," the analyst added.
Shares of Ultragenyx have dropped 55 percent this year. But, the data readouts on from key product candidates such as KRN23, rhGUS, UX007 (Triheptanoin) and Ace-ER could drive shares higher.
Shares of Ultragenyx were trading at $50.53, while the analyst has a price target of $104. The stock has been trading between $49 and $137.05 during the past 52 weeks.
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Latest Ratings for RARE
Feb 2016 | H.C. Wainwright | Initiates Coverage on | Buy | |
Feb 2016 | Credit Suisse | Maintains | Outperform | |
Jan 2016 | Credit Suisse | Initiates Coverage on | Outperform |
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