UBS Upgraded HALO to Buy @ PT $16 - 6/11/14
Matthew Roden, PhD
Charles Shi, PhD
1st Independent Confirmation "Herceptin-SC is expected to reach the US Market"" We forecast Peak Royalty Revenue in 2018" UBS 6/11/14
UBS 6/11/14 Report - "We see HALO as a Top Acquisition Target in mid-cap Biotech" $HALO
UBS 6/11 $HALO "we have increased confidence in the program and see compelling rationale for why both ph2 studies could read out positively"
(author's note - so when pegph20-folfirinox reads out positively, Halozyme will own- under the granted NCI CRADA full patent rights to the most potent combination for Pancreatic AND colorectal CA- where Folfirinox is already used- Colon CA is over 1/4 high hyaluronan - Therefore, HALO should choose Breast as the 2nd PEG site- to allow Roche's Avastin- which recently lost Breast as an indication- and Celgene's Abraxane franchises vie for the study by raising buyout bids.)
UBS "Assuming incrd prob. of success(PEG & Hylenex diab moved >25% risk-adjustment to 50%) would raise our valuation to $27/share " $HALO
$HALO "Said UBS: "We like the positioning from here. Upgrading...on pipeline potential and risk/reward."'
UBS 6/11 " $HALO appears Undervalued based on the breadth of portfolio: optionality on pipeline supported by de-risked partnership programs"
UBS 6/11 "While we admit limitations from small phase-1b data,we believe it's Sufficiently Pos. to suggest @ least evidence of effect" $halo
UBS -Jakafi is an appropriate comp for $HALO PEG program> INCY added ~$1.6bn in Mkt cap on (mildly)pos ph2 panc cancer data w only US rights (authors note- ruxolitinib plus capecitabine group versus the capecitabine alone group at three months was 48 percent- so less than 50% alive at 3 monghs means Median Overall Survival under 3 mos- but with highj hyaluron Ph1b, Peg-Gem MOS- 19 months)
UBS-Ph2 data is key long-term driver w a signif discount 'tween our new(& in our view still conserv.valuation method) & current levels $halo
UBS $HALO cats 1) full CONSISTENT1 data 2Q14. 2)FDA fdback-Hylenex diab 3) Q update Herc/MabSC launch 4) Potnl FDA apvl HyQ 5) 2nd Peg Site
UBS 6/11 on $HALO "We see the Roche partnerships worth $6/share, suggesting Upside potential on pipeline optionality"
Fair Warning- I just found a huge nugget of $halo news in UBS report-for release before the open Tomrw stay tuned-no "subscription" required
Disclosure: The author is long HALO.