UPDATE: Morgan Stanley Initiates Tesaro at Overweight with $19 PT on Low Risk to Lead Asset

Morgan Stanley initiated its coverage on Tesaro TSRO with an Overweight rating and a price target of $19 a share. Morgan Stanley said, "Rolapitant, an NK-1 inhibitor for prevention of chemotherapy induced nausea and vomiting (CINV), has low clinical trial risk given: 1) clear efficacy in Phase II, 2) a validated class with positive Phase III trials for two other chemically similar agents, and 3) strong correlation between Phase II and III for NK-1 inhibitors. Our $23 bull case assumes rolapitant's longer duration of action leads to evidence of superior nausea control compared to competitor Merck's EMEND, lowering commercial risks and expanding the market." Tesaro closed at $13.50 on Friday.