Wedbush's Gregory Wade, an bull from way back, strikes a slightly more cautious tone on Pharmacyclics (PCYC +1.4%), removing the shares from the Best Ideas list a day after ibrutinib won FDA approval in MCL.
"While subsequent compendium listings ... in RR CLL/SLL may lead to a change to this policy, we expect the absence of support of about $8900/patient contribution under Medicare Part D payment to be a significant barrier to the near-term use of the drug in the larger off-label settings," Wade says, adding that "there's a good amount of off-label expectations baked into some of the Street's expectations."
Outperform rating is maintained. Price target is $165.
Concerns about the drug's cost seem warranted. At $90+ per pill, Imbruvica will cost around $130K/year. Here's TheStreet's Adam Feuerstein outlining some mitigating factors: "PCYC is setting up a program to offer two months of free drug to patients who encounter reimbursement problems and co-payment assistance plans for patients who cannot afford the drug."