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Biotech: 2 Notable Afternoon Analyst Calls

|Includes: AbbVie Inc. (ABBV), MYOV, NBIX

Why is it that when one man builds a wall, the next man immediately needs to know what's on the other side?” ― George R.R. Martin, A Game of Thrones

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The mediocre teacher tells. The good teacher explains. The superior teacher demonstrates. The great teacher inspires.” ― William Arthur Ward

After starting in the black, the main biotech indices have reversed and are now deeply in the red heading into the close.  Sounds like an opportunity to do some 'shopping'.

Today, we take a brief look at two late analyst calls this Tuesday afternoon that might buoy the following stocks once selling pressure on the sector ebbs.

Let's start with Neurocrine Biosciences (NBIX).  Earlier today the FDA approved elagolix for the treatment of women with moderate-to-severe pain related to endometriosis.  The compound which is also known as ORILISSA will be marketed and distributed by development partner AbbVie (ABBV) and is estimated to have a monthly cost of ~$850.

So far Piper Jaffray ($113 price target) and Needham ($110 price target) have reiterated their Buy ratings on Neurocrine since the FDA green lighted elagolix.  Here is Needham's commentary post-FDA approval

Neurocrine and collaborator Abbvie announced approval of Orilissa (elagolix) for the management of moderate to severe pain associated with Endometriosis. Abbvie is guiding for the drug to be available in early August. According to Neurocrine mgmt, WAC price is $844.87/ mo for both 150mg QD regimen and 200mg BID regimen. Max treatment duration is 24mo for former and 6mo for latter. We are not making any material changes to our Orilissa sales ests. Neurocrine is entitled to a $40M approval milestone payment in 3Q18 and tiered royalties, which we believe range from 16-20%. Reiterate BUY.”

Given the shares now trade just over $105 and have had a nice run over the past few months, these are not the boldest of calls.

Reminder: Don't forget to take advantage of the 20% Off Sale with free 14-Day Trial happening at the Insiders Forum through market close tomorrow.

Citigroup gets the nod for the boldest call of the day.  It reiterates its Buy rating on Myovant Sciences (MYOV) in the wake of the FDA approval on  elagolix.  Citi's analyst believes Myovant could have huge upside.  A synopsis is provided below

'I currently model Myovant Sciences' relugolix priced at $10 per day. Modeling relugolix pricing at parity to elagolix and assuming a gross-to-net of 100% would lead to a fair value estimate for Myovant of $146, or the equivalent of $102 of upside from her current price target of $44. The analyst models a split market between relugolix and elagolix in endometriosis'Myovant currently trades under $20.00 a share.

The public have an insatiable curiosity to know everything, except what is worth knowing.” ― Oscar Wilde

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Thank You & Happy Hunting,

Bret Jensen

Founder, The Biotech Forum, The Busted IPO Forum & The Insiders Forum

Disclosure: I am/we are long abbv, NBIX.